Cisco Systems Inc at UBS Global Technology Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Amitabh Passi - UBS - Analyst : Excellent. Thanks, Edzard. If anybody has questions, please raise your hand. Edzard I want to kick it off. You are obviously broadening the scope of what Cisco does within the realm of services. Can you give us an appreciation of how the organization has evolved over the last couple of years and how do you anticipate it evolving over the next couple of years in terms of skill sets, number of resources, headcount, what some of the evolution has been like, and what do you anticipate to do it?

Question: Amitabh Passi - UBS - Analyst : I'm curious just on the last point, how has engagement changed from three years ago. So I don't know, pick any customer, either a large service provider customer or a large Fortune 100 customer, if we look at the sales go to market, or the services motion three years ago versus today, I mean is there a six people going in today versus one. Just give us an appreciation of how that engagement model has sort of transformed?

Question: Amitabh Passi - UBS - Analyst : And I'm curious there is any sort of specific metrics or is there a specific mandate from John in terms of -- I guess I'm curious how is John assessing your success in Services? Is it about revenue growth, is it about margin expansion, are there any sort of specific milestones and goalposts that you're being sort of judged against --? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. NOVEMBER 19, 2014 / 7:30PM, CSCO.OQ - Cisco Systems Inc at UBS Global Technology Conference

Question: Amitabh Passi - UBS - Analyst : How do you foresee the revenue trajectory, the growth rate now that Services are a much bigger and rounded up element of Cisco?

Question: Amitabh Passi - UBS - Analyst : I guess as you evolve Services, does the role of your channel partners evolve as well, like how does Cisco interact with the channel partners. Is there a greater competitive overlap or is it still very synergistic?

Question: Amitabh Passi - UBS - Analyst : When you talked about analytic services or security services, again, when you go in and engage with the customer, are you agnostic to the product that comes behind or again is the preference, I mean obviously to persist. I'm curious how sort of agnostic are you at the services level versus the product portfolio level?

Question: Amitabh Passi - UBS - Analyst : And then the automation capability, how do you sort of built that, is that --?

Question: Amitabh Passi - UBS - Analyst : In-house?

Question: Amitabh Passi - UBS - Analyst : Have you had instances where you've gone in an environment where it's Cisco networking infrastructure, maybe a competitor voice infrastructure, somebody else's collaboration infrastructure and then given the automation and the visibility analytics capability you bring to the table, have you had instances where the customer says that's great and have you displaced competitors and some of these other --? Unidentified Company Representative Yes. And I was actually -- I was hoping to share a big name for you, but I didn't got the clearance in time, which is unfortunate, but let me take you through the case there. It was five years ago that we were invited by this major financial institution to build out the network of local area and wide area. We then said, we can do that, but what we can also do is a full assessment of what you have today and how you would like to do that going forward. So we brought in in-house analytics. We trained their network operating centers, because they were they will run it but with our help and they uncovered quite a bit, not just from admin setting, security settings and all of that. So just by doing that and together showing that we can do it in a better way, creating a better SLA and better uptime was the first way. That created a lot of trust and then we were asked to move into the data center. Now we've been asked to basically put in all the voice components and we're building all of this together. And now as the important piece, what we thought, which I presented, was a bit of a stretch was to move from the infrastructure buying centers to the line of business. And we've just closed a multi-million dollar deal for consulting where we're moving all the way up to the boardroom because people are just talking about this that this really works and we're now sharing, okay, now you have your underlying fabric already, what is it that you are doing in the business process to -- how did you organize, how are you doing service one, two and three. And how can we with the new capabilities helps you to run that faster, less cost involved, all of that, and we're in the middle of that process. And there's another triple-digit order around the corner in the next two quarters. So yes, and again I would love to share it with you, because then you can verify. I'll make sure the next time I have it so you guys can call. But it's quite exciting, and it starts to resonate and it doesn't mean that it's fully end to end. Yes, on the components we have but we interconnect with all third parties and we just take the full responsibility for that.

Question: Amitabh Passi - UBS - Analyst : If there's any questions, please kindly raise your hand. You've also done some M&A in the area within the realm of services, I think JouleX was one. I think composite software probably falls in the space. [So, let maybe have you] go back and help us understand, give us a rational of the M&A transactions?

Question: Amitabh Passi - UBS - Analyst : So from a portfolio perspective, do you feel like you have a lot of pieces, do you think M&A will be a critical part of you running up the services organization?

Question: Amitabh Passi - UBS - Analyst : Can you clarify the intercloud discussion we had because I viewed intercloud as sort of the software connective tissue that you're providing that connects private clouds to display public clouds. It wasn't clear to me what the interplay and the interaction is with these services organization, in other words, is that a product software sale or is it something that your organization sells and where the two sort of link?

Question: Amitabh Passi - UBS - Analyst : Maybe on the security services side and even analytics, I'm curious from talent recruitment perspective, what is the environment like, is it difficult to find people today, is there a shortage of skill sets and how you're addressing that? I mean you touched on the academy. I suspect you're involved pretty heavily in terms of the training elements? But give us a sense of just kind of talent recruitment and retention?

Question: Amitabh Passi - UBS - Analyst : I don't know if the percentage is right, but I think your mix today is about 80% technical services and then --?

Question: Amitabh Passi - UBS - Analyst : Little bit less. I'm curious over the next two years, how do you see that technical services piece evolving like, do you go from 75, 25 to -- just some rough sense of how we think about growth within the buckets outside of technical?

Question: Amitabh Passi - UBS - Analyst : Excellent. Edzard, I think we're almost out of time here. I wanted to thank you so much for coming and spending some time with us and --.

Question: Amitabh Passi - UBS - Analyst : Thank you.