Cisco CEOsspeech.docx

Cisco CEOsspeech.docx

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CiscoCEOsspeech

CiscoCEO’sspeech

It'sapleasuretobeheretoday.Inmanywaysit'sbindofinterestingbecausesomebodywouldhaveasked.WouldaninternetworkingcompanybegivenakeynoteatCOMDEXjusttwoyearsago.threemanypeopleinthisroomwouldhavethatwouldhappenthreegoingavoidinthefrontrowthatevenwithourowncompanywewouldnotconsiderthisadesktoporclient/servershallwithoperateassistantetc.Insomeofthelargestplayersatthisshowtwoyearagowouldnearlyignoretheinternet,andyetifyoulooktodayandwheretheproductsofallalmostallthecompaniesattheshowwillbeourthenextthreeyearsthedevicesbethehightechandlowtechwouldhavemajorconnectivityandalmostallthehighproductivityapplicationswilllasoratetheirnetworkinamajorway.Inshort,weareinvolvingtogetthetechnologiescloserandclosertogether,andwearechangingalmosteveryaspectofourlivesaswegoforward.Idon'tthinkit'stoolargeastatementtosaywearealmostinarevolutionifyouwillaswemoveforward.Itwillchangeliterallythewaywework,live,play,andlearnandthewaymanypeoplehavenotthoughtof.AndIwanttothrowoutthediscussionrefertotheinternet.Asyoucanseeasyougrowyougetalotofmoreattentioninmanywaysmostofthemforthebetterifwewishtomoveforward.Wewantallourconcerns.Butalsoencouragepeopletovoiceinternsatthenighttimeandourvoicebeingverysuccessfultoanyone'scomer'satanypointoftime.ButwhatyouseeistheinternetandIwanttodefinetheinternetnotinawholebunchoftechnologyterms.TheInternettomeisonebignetwork.It'snotthecooperateintranets,it'snottheextraneousthattietogetheryoursupplieswithyouatwork.It'snotthebig-internetIt'sallonethatworksbecausenosoonerdowecreatetheterminologythanthelinelearn.Butliterallyitwillchangeeveryaspectofourlivesthewaywework.Thosecompanieswhounderstandhowtoapplythetechnologywouldgetaheadofothercompanies,andperhapsitwoulddeterminethegrowthoftheirsurvival.Itwillchangethewayweplayandliveandthewaysjuststartedtodreamaboutthedayandperhapschildrenunderstandbetterthanwedo.Andwealsochangethewaywelearn,becausethepeoplewhograduatetodayfromschoolwillhavebetweensitandtenjobsastheymoveforward.IwanttoverymuchthankCOMDEXforallowingmetobehavetodayandIalsowanttothanktogroupforalloygroupbawdythatworksinEuropeandwelcometheEuropeancrowd.

I'dliketoreallyfocusonprmalyhousechangethewayaswemoveforward.ButIwantdrawhowquicklythischangeoccurringinvolvingalmostlikeIndustrialRevolutionifyouthepast.Whenyouthinkaboutit,theIndustrialRevolutionoccurred,startinginGreatBritainspreadinWestEuropeandthentheUnitedStates.Itchangedthewayweworkedlivedinplacemanyforthebetter.Itdetermineswhicheconomywilltakeoff.Italsodetermineswhatwastheshillsetsweneeded,theverysimplygood,whatitdidisitbroughttogethermachinesandpeopleinfactoriesandchangedforeverourlife.ItwasarevolutionthatoccurredseveralhundredyearsandluredpopulationsmovefromcountrytocountryandcompaniesmovefromcountrytocountrybasedupontheirabilitytoemploythetechnologyinthisIndustrialRevolution.Idon'tthinkinternetrevolutionisanydifference.It'sgonechangeallaspectsofourwayoflives.Itliterallywillbringtogethertheinternetrevolutionifyouwill-peopleandinformationinglobalvirtualcompaniesanditwillhavethesameeffectthattheIndustrialRevolutiondid.Buttheinternetmovesinwhatwecalldog-yearsorinternet-years.Onecalendaryearisdogs-likeisreallysevenyears.Thesamethingistrue（in）theinternet.Theinternetmovesatthepacealmostseventimesfasterthannormalbusiness.JustlookathowmuchitoccurredinthelosttwoyearssinceCOMDEXtwoyeasagoanddiscussionthatworktheroleitplaceasyoumoveforward.It'salsogoingtobeinternetgeneration.Weareallpartofthat.Andgenerationdoesnotapplytooneagegroup.Ourchildrenperhapsunderstandmoreabouttheinternetthanmanyofthepeopleinthisroomintermsofhowtouseitandhowtoserverforit.WhenItalktoanumberofourcustomers,theywouldsay:

"John,itmightsurpriseyouinthefaceofthestronginternet."Iamtalkingaboutpeoplewhoaregoingtobeconsumers.AndmanyofthemsaidthatIhadtheanswer.Eighteentothirtyyearsoldsay:

"Yes,Iexpectthat."Butfifty-fiveandover.Thepeoplewhohaveextratimeontheirhandstohaveanapplicationtolearnhowtouseinternetforsuchaslookinguptheirstocksorcommunicatewithgrand-childrenstudyingtobeinthisarea.Orinternetgenerationalsoappliestocompanies.ThosecompanieswhounderstandhowtoemploythistechnologypicktherightapplicationsattherighttimeunderstandthecompeteadvantagekeeponestepaheadinthisnowmarketwouldbethosewhogrowandsurviveasyoumovefrondbeforeAndit'salsoappliedtothecountries.JustliketheIndustrialRevolutiondermiseswhichcountryhadthebeststandardoflivingoveraperiodofhundredsofyears.Theinternetrevolutionwillsthesameimpact.Thosecountrieswhousethistechnologytoaddproductivityactivitytothegovernment,whousesthistechnologyintheway,theyteachchildrenhowtoemployittobemoreeffectivenotalwaysinbusinessbutalsointhewaytheyliveandplay.Andthosecountriesandcompaniestoemploywoulddeterminethefutureoftheireconomiesinmanyways.ItusedtobetheU.S,EuropeandJapanasexample.Youcouldoftentellwhattheeconomywaslikeintermsofinternetbutalsothemaincards.AlmostnoJapanesebusinesspersonhascalledonehadaninternetaddressonit?

Todayit'salmostsociallyunacceptablenottodothat.TheJapaneseinfouryearshaveclosedtheadvantagethattheEuropeandNorthAmericatohaveontheinternetwhereitalmostcompletelyequal.Thenunderstoodtheimpactthatitwillhaveonthefutureoftheirbusiness,thefutureofthecountry,thefutureoftheirchildren.Sotheinternetgenerationispeople,companiesincountriesmoveinanunbelievablepaceasitmoveforward.

Therearetwothingsthatarereallydrivingthis.Thefirstisitsfourthgenerationoftechnology,witheachgenerationbeingdramaticallybiggerthanthepriorgeneration.Forseveraldecades,itwasbethemaintrend,followedbymini-computer ,andthenliterallyComdexdesktopandclient/serverapplicationspiecesoflands.Andnowitisthenewworkgeneration.Anditwillhavemoreimpactprobablythemallthethreepriorgenerationscombined.Soasyoumoreintothenewgenerationtechnologyyounaturallyseetheexplosion.Butwhatisdrivingitevenstrongerthanthetechnologyisthebusinessestablication.Itdoesn'tmatterifyouareinGermany,France,UK.US.,Japan,orChina.Allthebusinessorganizationshavethesamechallenges.TheyunderstandtheparticularlylargecompaniesorganizeimproperlypropertyYouseethespendsincontrolincreasedramaticallyremovalofthelayersoftheorganizationsintheimpairmentoftheworkforce.Buttheimpairmentonlyworksifyouhaveaccesstotheinformationandyouknowwhatyousurposetobeabletodo.Andnearlythecompaniesyoulearnhowtodothisaregoingtobetheonemovingahead.TheaverageproductivityorprofilablityreturnthatwegetCiscoasandexampleisover10%peryearincreaseofprofilabilityorproductivitywithinthecompanybecausetheyhowusetheapplication.Andaverageproductivityisover50%increasefortheInternetapplicationthatwedo.Ididn'tunderstandhowquicklythiswaschangingtomoreandmoreofchiefexecutivebosses（offices）haverealizedthattheinternetisgoingtobethebeyproductivitytowardsthenextdecadeperhapsdeterminestheirsurvival.AnexamplemouldbetwoyearsagoifIcallexactlythechiefofficerofalargefinancialinstitutionWehadaverygoodconversation.TheyaskedmethequestionsthattheCIOandforaboutthefirsttenminutesandforthenextfortyminutestheydiscussedaboutinvestingascosIbilliondollarsincashorifIdidn'twanttogivethemthemoneytoinvest,howaboutmakingloantome.Andotherwordsexecutioncannotlessusaboutthistechnology.Todayit'sverycommontomeetwiththewholeexecutinemanagementteam.Thetalkwiththeleadersthefinancialinstitutionabouthowthisisgoingtobeprimeactivityforthenextdecadeforthem.Thetalkabouthowtheyaregoingtousethistoolasbanking,andinsurance,andstockrecouragecombinetopresenttheboardandthedirectorwhythisisimportanttogetimproveoftheirbudgetandevenwhenthey keycustomerstomeetwiththosecustomerstoexplainhowthefinancialinstitutionisgoingtousethetechnologyinthewaythatwillbenefitthem.Andthisisoccurringataincreasinglyfastpace.ThebusinessdriversLet'susetheU.S.asanexampleDuringthepriorgenerationoftechnologymanycomputers.Ifyoulookatthetotalcapitalspendingtheamountofmoneywasspentonplantsequipmentautomobilethingsofthattype,itwasinasingledateduringtheseventiesAsPCstaredtotakeoff,anotherdesktopdientserverdevices,youbegantoseeanincrease.Todaynetworkingisnearlydrivingthisincrease.YouaretakingaboutintheareaofcapitalspendingintheU.S.43%ofallcapitalspendinggoingtohigh-tech.OneofthereasonsoureconomyissostrongintheU.S.versesothereconomiesaroundtheworldishowthishightechnologyisbeingappliedanditdoesn'ttakemathematiciansverylongtorealizewhichwaythistrendisheading.Butyoucanstillseeothercountriesar