Cisco Sales Slump: Technology Giant Plans To Get Rid Of Senior Management In China Due To Poor Sales Figures
|Vinay Patel |||Jun 15, 2015 03:22 AM EDT|
(Photo : Reuters) Cisco Systems Inc. is planning to remove senior management due to the Cisco Sales Slump because government fears the security of foreign networking equipment. The downgrading sales figures have led to the flattening of the organizational structure in China.
Cisco Systems Inc. is planning to remove senior management due to the Cisco Sales Slump because government fears the security of foreign networking equipment. The downgrading sales figures have led to the flattening of the organizational structure in China.
Citing the growing fears of the government regarding the foreign networking equipment, Cisco Systems Inc. has announced plans to remove senior executives from its Chinese set-up. The move comes as a surprise as the company struggles to improve its slumping sales figures. However, the flattening of the Chinese organization is also in line with the company's global strategy to reorganize the managerial structure, confirmed by Topix.
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Meanwhile, John Chambers, long-time Chief Executive at Cisco, announced last month that he would be handing over the charge to Chuck Robbins, another Cisco veteran. Apparently Robbins is the one in favour of the cut-down as he said that he would be keen to establish a management structure that is quick, when it comes to taking crucial decisions.
In fact, this month itself, Robbins reduced his core team strength to 10 from the previous figure of 13, simply to stay in line with his objective. The report on Wall Street Journal claimed that Hahn Tu, Cisco China president, and Fredy Cheung, vice president in Greater China, are amongst the senior members of the Chinese management that have been asked to stepped down from their positions. However, so far there is no clarity on whether these positions will be eliminated or completely replaced. Those who had been informed about the matter said that Cisco Greater China Chairman Owen Chan would remain in his place.
In a year's time, Cisco's sales have dropped by a massive twenty percent, increasing the cause of concern for the company. It is believed that the decline in sales is majorly due to the Chinese government's decision to shift to local technologies after the infamous Edward Snowden leak, where it was revealed that American agencies are using surveillance tools in their technological equipment to spy over China.
Additionally, Cisco is also facing stiff competition from other firms in the technology category.
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