John Chambers, Cisco and its Internal Governance Systems

**This case was presented at the 2012 North American Case Research Association Annual Meeting held in Boston, Massachusetts, USA.

Case Details Case Introduction 1 Case Introduction 2 Case Excerpts


Under John T Chambers' 16-year tenure as CEO, Cisco grew from about US$1.2 billion to over US$40 billion in revenue, and from US$410,456 to US$7.8 billion in net income. Chambers was considered a celebrity CEO, one of the most revered executives in the history of the technology industry. Yet, in 2011, many shareholders of Cisco as well as a few industry observers demanded that Chambers, who was also the Chairman of the board of directors of Cisco since November 2006, be terminated from the company.

These investors and Chambers' detractors contended that for more than a decade Chambers had failed and that Cisco's was a dead stock - languishing since the Dotcom bubble burst. In May 2011, Cisco's stock price was around US$17, about where it was in December 2000.

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The case is structured to achieve the following teaching objectives:

  • Understand the role of the board of directors and its relationship with the CEO.
  • Study the internal governance system of Cisco with special emphasis on the operating governance framework.
  • Discuss and debate the performance of John Chambers, his strategy and emphasis on management through committees.
  • Understand issues related to the board's obligations and accountability to the shareholders .
  • Discuss and debate the decision that the board of directors at Cisco should take with regard to John Chambers' future in the company.

Background Note
Corporate Governance
Operating Governance Framework
Putting the New Structure in Place
Initial Results
Empowering Groups or Consolidating Power at the Top?
Cisco's Response
Has Chambers Failed?
Chambers Admits Mistake
Time for a Change?


Corporate social responsibility, Corporate social opportunity, Sustainable model, Sustainable development, Inclusive growth, Bottom of the Pyramid, Public-Private partnership, Collaboration continuum, Rural consumers, Price information, Spot trading, Gramin Suvidha Kendra, MCX

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