Cisco's chief executive John Chambers has urged partners to keep up with the pace of change or join the 40 per cent of today's successful companies which will no longer exist "in a meaningful way" in the next decade.
During his keynote speech at the Cisco Partner Summit in Montreal, Chambers (pictured at the event) bullishly insisted that willingness to change is one of the biggest things he asks of partners, as he paced around the stage and among the partners seated in the audience.
He admitted that this has been something on his mind for many years - he made similar comments at last year's event - but said the urgency to adopt change has rapidly increased recently.
"Disrupt or you are going to get disrupted," he said. "When we were here two years ago, I held up a chart which I thought was pretty challenging - it talked about the Fortune 500 and how only 24 per cent of them existed 25 years ago. It talked about how a third of them would literally not only not be on the list in the next 25 years, but they would be out of business. I was way, way, way too optimistic.
"The number [of today's successful companies which will fail] will be much, much worse. I hate to say it, but when I talk to large enterprises around the world - and I have done a lot of that - there is zero disagreement. I look into the room with those CEOs and CIOs and say ‘40 per cent of you will not exist in a meaningful way in the next 10 years'.
"While that might have been a bold statement a year or two ago, they understand it [now]. This digital change is going to change business models, how you innovate, how you interface with your customers and employees in a way they've not seen before. As this occurs, you're going to see a lot of companies get disrupted. "
Under the radar
He pointed to new firms Uber and Netflix and used them as examples of how they disrupted their markets almost overnight. He encouraged resellers to think in the same way, and to expect a new breed of competitor to be born out of the change.
"You're going to have a new generation of competitors that won't look anything like your prior generation did," he said. "If you look at what makes a company very successful and [what makes] it fail, it is surprisingly simple. The number-one issue every company must do is get the market transitions right, especially the technology transitions. If you miss those, you get left behind in this industry. Think through all those companies... that were great companies - Alcatel Lucent, Digital Equipment, Dell and so on - [they are] where they are today because they missed just one transition."
He said the channel ought to be one step ahead at all times.
"The second mistake companies mistake is [getting] too comfortable doing the right thing again and again and again. You know what's wrong with that? The right thing done too long commoditises. You have got to reinvent yourself."
Chambers' partner address focused heavily on the need for the channel to transform, but he did manage to take a swipe at rival HP in the process.
He insisted Cisco has succeeded in technology areas where its rivals were doubtful it would.
"We are capturing the transition with compute and storage and networking," he said. "We are going into the datacentre where people said we would be out of it in a year - thank you HP for saying that! Here we are passing them this year in North America, and we're about to become number one in the world!"
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