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Cisco restructuring follows Goeckeler departure

The Cisco restructuring that follows the departure of executive VP David Goeckeler has reshuffled the company's executive team among five newly created product groups.

Cisco has announced an extensive restructuring of its business groups in the wake of the departure of David Goeckeler, who, as head of the networking and security group, oversaw the company's largest revenue generator.

Goeckeler notified Cisco March 4 that he was leaving to become CEO of storage hardware maker Western Digital. He started his new job on March 9.

On the day Goeckeler joined Western Digital, Cisco announced a restructuring of its business groups and a reshuffling of the executive team. Also, Cisco said Amy Chang, who was head of Cisco's collaboration business, had taken an indefinite leave of absence. Cisco said it expected Chang to return eventually.

"Amy Chang has decided to take some time off, prioritizing spending time with her family," the company said in a statement. "Amy is not leaving Cisco, and we look forward to her return."

Goeckeler was a critical player in making software sales a more substantial portion of Cisco's overall revenue. While the most significant slice of Cisco's sales comes from network hardware, the company has been steadily increasing the percentage coming from software in networking, security and the cloud.

Goeckeler's leaving is "certainly a loss for Cisco," said Rohit Mehra, an analyst at IDC. "But on the other hand, I think the foundation that he and [CEO] Chuck Robbins have laid will ensure that Cisco endures this loss."

Indeed, Robbins seemed supportive of Goeckeler's decision on Twitter.

"So happy for @DavidGoeckeler -- we will miss you but we will all be your biggest fans! Go make us proud as we know you will!"

Cisco's restructuring

The post-Goeckeler restructuring of Cisco's business groups comes as the company works to reverse sliding sales. For the quarter ended Jan. 25, Cisco's overall revenues fell 4%, while product sales and orders were each down 6%. The company forecast a revenue decline of between 1.5% and 3.5% in the current quarter.

The latest changes include Cisco dismantling Goeckeler's networking and security group. Instead, the company split networking and security into separate groups -- enterprise networking and cloud, and security and applications. Cisco had not chosen the leader of the latter but said senior VP and general manager Todd Nightingale would direct enterprise networking and cloud.

Before the promotion, Nightingale was in charge of Cisco's cloud networking unit, which included the vendor's Meraki product line. Selecting Nightingale to lead all of Cisco's networking portfolio reflected the company's commitment to bring more cloud-based automation and management to its products, Mehra said.

"Most enterprises, as part of their digital transformation, are looking at a cloud-first IT strategy," Mehra said. With Nightingale, Cisco has shown it has that "mindset."

Cisco folded the collaboration business led by Chang into the security and applications group. Senior VP Sri Srinivasan will lead the collaboration unit where, under Chang, he was in charge of Cisco's Webex conferencing portfolio.

Cisco formed three other new groups following Goeckeler's departure. They included:

-- Mass-scale infrastructure led by senior VP and general manager Jonathan Davidson. Before his new position, Davidson was head of Cisco's service provider business.

-- Core hardware platforms led by senior VP Eyal Dagan. The group will develop the ASICs used in Cisco's switching, routing, optical, cable access and IoT products. Dagan had led Cisco's Core ASIC unit before the promotion.

-- Emerging technologies and incubation led by senior VP Liz Centoni. She had been in charge of Cisco's former cloud strategy and computer group, which the company launched in November as part of its last restructuring.

"Our new product leaders are experts in these areas, and we are thrilled to have them bring new perspectives to Cisco's executive team," the company said.

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