Insight: Succession questions swirl around Cisco's Chambers

Tue Sep 13, 2011 11:27am EDT
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By Nadia Damouni and Nicola Leske

(Reuters) - When John Chambers takes to the stage on Tuesday, many will be wondering if it is the last time the chief executive leads Cisco Systems Inc's annual financial analyst conference.

After more than 16 years at the helm of the world's largest network equipment maker, there is discussion both inside and outside Cisco that it is a matter of when -- and not if -- Chambers will cede the CEO job.

While Chambers, 62, still enjoys the support of the board and there is no formal CEO search under way, there is frustration in the company over the lack of a clear succession plan, according to people with knowledge of the situation.

Potential candidates have begun to lobby Cisco shareholders to build support, amid a general belief that the next leader will likely come from outside the company following the exodus of many senior executives in recent years.

The roster of possible CEO contenders being bandied about Silicon Valley include former Hewlett-Packard Co chief executive Mark Hurd and former Cisco executives Charles Giancarlo, Mike Volpi, Gary Daichendt and James Richardson.

Other industry executives who have also been mentioned as possible contenders for what would be one of technology's most high-profile jobs include Juniper Networks Inc CEO Kevin Johnson, former McAfee CEO Dave DeWalt, and HP executive David Donatelli.

"The internal people at Cisco are having a massive war right now about potential succession," said a source close to the company. "There is real tension about succession. Everybody knows it's coming now."

As for Chambers himself, he wants to end his tenure on a high note, which means he will not likely be stepping down until the company's quarterly results are on firmer ground, said the source and another person close to the situation.   Continued...

<p>Cisco Chairman and CEO John Chambers delivers a speech at the GSMA Mobile World Congress in Barcelona February 16, 2011. REUTERS/Gustau Nacarino</p>