Speaker 1: This is Bloomberg Business Week with Carol Masser and Bloomberg
Speaker 1: Quick Takes Tim Stinovich from Bloomberg Radio. Cisco Systems they
Speaker 1: set their first greenhouse emissions reduction goal back in two
Speaker 1: thousand six. Since then, the tech giant has continue to
Speaker 1: grow its sustainability initiatives and impact year after year after year.
Speaker 1: Earlier this month, the company announcing a new commitment to
Speaker 1: achieve net zero emissions by twenty and more. Friend Katsudas
Speaker 1: is a longtime Cisco Exact executive vice president and Chief People,
Speaker 1: Policy and Purpose Officer, and she joins Tim and me
Speaker 1: in our Bloomberg Interactive Broker studio. So good to see
Speaker 1: you again. Nice to see you too. Thank you. I
Speaker 1: feel like I do have a million questions for you,
Speaker 1: but we'll get as much as we can get in.
Speaker 1: First of all, before we get into sustainability, I do
Speaker 1: want to ask you about the visibility you see when
Speaker 1: it comes to your business and the company and hiring.
Speaker 1: What does it look like right now? And we're coming
Speaker 1: off a FED meeting, we feel like we get a
Speaker 1: little bit more clarity. The markets certainly read it that way.
Speaker 1: What do you guys see so we see a tremendous
Speaker 1: amount of opertun unity. What's so fascinating is, throughout the pandemic,
Speaker 1: we saw so many of our customers wanting to move
Speaker 1: a little bit more quickly. From a transformation perspective, we
Speaker 1: saw that the issues they had been thinking about, they
Speaker 1: were ready to move. So what that means for us
Speaker 1: is we see a lot of investment in how they
Speaker 1: securely connect their thinking about having employees both on site
Speaker 1: but also working from home, and that's a different technology play.
Speaker 1: From a people perspective, this has been one of the
Speaker 1: most remarkable times. Right now. People are talking about this
Speaker 1: period as the Great Resignation, and what they mean by
Speaker 1: that is we see a tremendous amount of people movement
Speaker 1: as well. Yeah, really important question when we think about
Speaker 1: the way that people are changing jobs, the way that
Speaker 1: people are potentially leaving the workforce. I want to go
Speaker 1: back to something you said about the transformation that you
Speaker 1: saw throughout the pandemic. Do you see this as a
Speaker 1: permanent shift with a lot of your customers that their
Speaker 1: employees could be working from home forever. I think a
Speaker 1: lot of our customers are figuring that out, So I
Speaker 1: would say that there's a subset of our customers that
Speaker 1: absolutely have found greater productivity, they see better employee engagement,
Speaker 1: and they're going to continue to work hybrid. I don't
Speaker 1: see as many absolutes where people are either going to
Speaker 1: be all in the office or at home. I think
Speaker 1: they're figuring out the balance. And then there's a subset
Speaker 1: of our customers that want to go back, and that's
Speaker 1: something that we really questioned around can we go back?
Speaker 1: And the reason I put that forward is that employees
Speaker 1: around the globe are telling us that they want to
Speaker 1: work in a very different way. I mean, the horses
Speaker 1: left the barn right when it comes to hybrid work,
Speaker 1: I think it's safe to say that there's probably been
Speaker 1: tons of focus groups pre pandemic. Can it work? And
Speaker 1: it not? Maybe we're not ready. I mean the pandemic,
Speaker 1: we had no choice and it worked. Yeah. That's why
Speaker 1: we refer to this last period as not only challenging
Speaker 1: from a human perspective, but an experiment around work where
Speaker 1: we've learned a lot. And I think for some companies
Speaker 1: this question that they had has now been answered and
Speaker 1: that they can work, they can innovate, they can collaborate,
Speaker 1: and in some cases they can be even better with
Speaker 1: this hybrid because they can get to talent that in
Speaker 1: the past they couldn't before. Well, how has the talent
Speaker 1: acquisition process been? How has talent retention been at Cisco Systems.
Speaker 1: You said that some people are referring to this as
Speaker 1: the great resignation. We hear about the labor struggle that
Speaker 1: employers are facing right now. Um, tell us what it's
Speaker 1: been like for you and FED Chief J. Powell talking
Speaker 1: about it's a really tight labor force. It is, so
Speaker 1: we experienced that as well. What was so fascinating was
Speaker 1: when when we first went into the pandemic, we paused
Speaker 1: for a few weeks just from a hiring perspective, and
Speaker 1: we were just kind of getting our legs under us
Speaker 1: and understanding what this was going to be. And then
Speaker 1: we had this realization that we were in this for
Speaker 1: quite some time, and we started the hiring process, and
Speaker 1: what we found was leveraging video, leveraging the interview processes
Speaker 1: that we have, we hired like never before. And in fact,
Speaker 1: I would tell you that last year was probably one
Speaker 1: of the biggest hiring years that we've had as a
Speaker 1: company azing and so many employees have never met any
Speaker 1: of their colleagues face to face. It's a position I
Speaker 1: then I start in October last year here, yeah, exactly,
Speaker 1: and there's people that he's now meeting. Is like I've
Speaker 1: been talking to you, you know, via remote, and now
Speaker 1: I'm finally meeting you. It's it's a very different world. Yeah.
Speaker 1: I had a really funny experience last week where two
Speaker 1: colleagues were meeting. I happened to be there and one
Speaker 1: of the colleagues that we're friends though, even though I'm
Speaker 1: meeting you for the first time. And so what I
Speaker 1: would say is for all companies, we do see that
Speaker 1: there is a reduced labor pool. We're working incredibly hard
Speaker 1: to differentiate ourselves, to talk about what we stand for,
Speaker 1: and to attract the talent that really wants to be
Speaker 1: with us as well. We've got about forty seconds. Then
Speaker 1: we'll come back and talk more. Do you have to
Speaker 1: pay up more? You do, because whenever you have a
Speaker 1: market where there's a tremendous amount of movement, employees are
Speaker 1: going to an opportunity and they expect at least a
Speaker 1: three five percent increase. Okay, is that what you've done
Speaker 1: three or if you had to go even higher We've
Speaker 1: heard stories about, you know, double digit increases for salaries.
Speaker 1: It varies based on the market, but yes, it's a
Speaker 1: huge challenge right now for many companies to expect it
Speaker 1: to continue. I just tight for a while. I int
Speaker 1: next year. Yes, I love her. All right, We're gonna
Speaker 1: continue with Frank cassudas over at Cisco Systems. You're listening
Speaker 1: to Bloomberg Business Week and this is Bloomberg Radio. We
Speaker 1: are here with Frank Cassuda. She's executive vice president, chief People,
Speaker 1: Policy and Purpose Officer at Cisco Systems here in New York,
Speaker 1: normally based on the West Coast, but you were reminding
Speaker 1: us that Cisco get a pretty big presence here in
Speaker 1: the UH here. Yes, in the United States, in New
Speaker 1: York specifically, we do. It's such an important market for us,
Speaker 1: so so many of our customers are based here. It's
Speaker 1: a great place for talent, a lot of the technology
Speaker 1: as well. We're actually in the process at the moment
Speaker 1: of remodeling our presence here in New York, and big
Speaker 1: part of that is hybrid work, and so we're thinking
Speaker 1: a lot about when you come into the office, how
Speaker 1: will you work? And so I think you'll see our
Speaker 1: presence in New York look very different from what it's
Speaker 1: been in the past. What do you mean by that?
Speaker 1: How how is it going to be different? So the
Speaker 1: biggest differences fewer people will come into the office to
Speaker 1: work on email or to be in video call. So
Speaker 1: when you come in now, you're coming in to be
Speaker 1: with your team, You're coming in to be with customers.
Speaker 1: And so the site has to be so much more
Speaker 1: team centric than ever before. And so you're going to
Speaker 1: see a lot fewer of the cubes and the individual
Speaker 1: offices and a lot of huddle space. So physical changes absolutely.
Speaker 1: Do you need A big question that Fran we've been
Speaker 1: talking a lot about is what is the use of
Speaker 1: commercial real estate going for? You still need to have
Speaker 1: space though, or do you need less? I think it's both.
Speaker 1: So I think that all companies right now are assessing
Speaker 1: how they're going to work, how much space they need.
Speaker 1: What we're finding is there's a lot of investment in
Speaker 1: spaces now, either for safety reasons or an expectation of
Speaker 1: people coming back and really wanting to just upgrade the
Speaker 1: space as well. How are you thinking about your presence
Speaker 1: in New York in the future in terms of headcount. Yeah,
Speaker 1: I would say it's uh it's a really important growth
Speaker 1: area for us, and so we look at about five
Speaker 1: key areas across the US. New York is one of them,
Speaker 1: and so we will continue to to hire and really
Speaker 1: attract and recruit the best. You talked about it being
Speaker 1: a tight labor market. What's the New York labor market
Speaker 1: right now for the type of workers you're looking for.
Speaker 1: It just got about fifteen seconds. It's incredibly competitive, and
Speaker 1: uh so this is a place where the wonderful thing
Speaker 1: is you see the skills that we're looking for, but
Speaker 1: you see that the talent has a lot of different options.
Speaker 1: We're still here with brand Kasudas, she's executive vice president,
Speaker 1: Chief People, Policy and Purpose Officer at Cisco Systems here
Speaker 1: in our interactive broker studio. So talk to us about
Speaker 1: the new commitments. Earlier this month, you guys laid it
Speaker 1: out planning to achieve net zero emissions by achieve carbon
Speaker 1: neutrality for Scope one and Scope to UM and that
Speaker 1: I believe is by so go into it because you
Speaker 1: guys have been doing this for a long time. What's
Speaker 1: the difference. What's the new new stuff that we need
Speaker 1: to know about? Yeah, so I would say we have
Speaker 1: been doing this for a long time. And here's the
Speaker 1: most important part for companies to achieve these goals, which
Speaker 1: are really big and even bigger if you're a hardware
Speaker 1: and software company. Uh, it takes every part of the
Speaker 1: organization to be focused here and it has to feel
Speaker 1: like a key part of run in your business and
Speaker 1: not something that sits on the side. Because these goals
Speaker 1: are pretty significant. And so we've been doing this for
Speaker 1: a long time. The four big areas that we're focused
Speaker 1: on right now. The first is hybrid work. As we
Speaker 1: talked about, We believe that will be incredibly positive for us.
Speaker 1: The second thing that we're doing is really focused on
Speaker 1: the reduction of carbon emissions, and uh, we're investing in
Speaker 1: technologies that I think will give us all optimism. Uh.
Speaker 1: There's a company that we invested in called Rama. They
Speaker 1: actually won a prize with us, and they're doing carbon
Speaker 1: capture for large semi trucks and that is so important.
Speaker 1: The third area that we're focused on is all about
Speaker 1: renewables and so, as an example in the US were
Speaker 1: renewable electricity several countries across Europe as well. And we'll
Speaker 1: just keep on pushing, and then I think another element,
Speaker 1: and this is the most exciting, is we're looking at
Speaker 1: the way in which we're developing our products which really
Speaker 1: power the Internet. And one of our new products, Silicon one,
Speaker 1: is a chip set, and what it does is it
Speaker 1: reduces the amount of energy that our customers use by
Speaker 1: twenty six times. And in addition to that, it's much
Speaker 1: smaller than previous products, so it doesn't take as much packaging.
Speaker 1: And so when you have this type of breakthrough across
Speaker 1: your portfolio, it's going to be incredibly meaningful. What is
Speaker 1: the biggest challenge that you think you're going to face
Speaker 1: when you try to achieve net zero emissions? Because you
Speaker 1: know that's not that far away, So the biggest challenge.
Speaker 1: And then there's people like me, I'm like, why can't
Speaker 1: we do it sooner? Come on? Fran always like, that's well,
Speaker 1: think about this. So what you're solving for with Scope three,
Speaker 1: which our commitment is, is you're solving for the way
Speaker 1: in which your customers are using your products. You through
Speaker 1: the whole change and so you go through the entire
Speaker 1: supply chain. And so the interesting thing is what we
Speaker 1: control the Scope one and two and so that we're
Speaker 1: doing is a much more challenging play because it's Scope
Speaker 1: three and we have to look at everything do and
Speaker 1: scope one. I had to learn a lot about this.
Speaker 1: I had talked with Brand for a panel for you
Speaker 1: here at Bloomberg. Scope one is direct greenhouse emissions that
Speaker 1: are controlled by the company Cisco. Scope too is indirect
Speaker 1: emissions from things like electricity generation of that steam heating cooling.
Speaker 1: But you're right three is you're really pushing further out.
Speaker 1: Every single thing that your company creates with your customers
Speaker 1: is what you saw for and Scope three, how much
Speaker 1: of that is in your control? So this is where
Speaker 1: it gets complex, and this is where we're right. This
Speaker 1: is why it's so wonderful right now that so many
Speaker 1: companies are coming forward with commitments, because it's going to
Speaker 1: take all of us to achieve this. We're going to
Speaker 1: be so dependent on our supply chain, and so we've
Speaker 1: been working with them for ten years. But there's a
Speaker 1: lot of work that we need to do to get
Speaker 1: there and to make it something that feels like it's
Speaker 1: within our control. The only other thing that I would
Speaker 1: add is there's also some some new I think um
Speaker 1: baselines that are being established. We just signed the Race
Speaker 1: to Zero. That's something that we're really proud of because,
Speaker 1: as you know, that's a concern stint threshold, it's scientific.
Speaker 1: We're doing that together as part of Global Citizen, with
Speaker 1: many of our peers and industry, and it will have
Speaker 1: tremendous impact as we move forward. I guess what's interesting too,
Speaker 1: is I wonder about the conversation that's going on when
Speaker 1: it comes to climate change. We heard a President Biden
Speaker 1: talk about it other world leaders. Is the conversation the
Speaker 1: right one, especially since you guys have been doing this
Speaker 1: for a while. Our people taking it seriously, maybe more
Speaker 1: seriously after the pandemic where we saw as the world shutdown,
Speaker 1: skies were clearer like we saw the impact, but we've
Speaker 1: also seen fires on the West Coast. We've seen what
Speaker 1: climate change is doing to our world. I think the
Speaker 1: conversation could be so much more opportunistic. I think if
Speaker 1: we all look at some of the benefits from a
Speaker 1: business and from a planet perspective in doing these things.
Speaker 1: I mentioned one of our products. Our customers love that product.
Speaker 1: It is one of the fastest out in the marketplace.
Speaker 1: That's a win for us. And did your customers put
Speaker 1: more pressure on you guys after the past year or
Speaker 1: so or a couple of years when it comes to
Speaker 1: climate change and saying yes, And I think that helps.
Speaker 1: I think the more that our customers can share with
Speaker 1: us what they're trying to achieve will work together. But
Speaker 1: I think the conversation right now is so focused on
Speaker 1: the downside as opposed to the opportunity, and if we
Speaker 1: look at the business, I think we'll have a different
Speaker 1: approach to it as well. We got a hot headline
Speaker 1: coming in that I just wanted to break. The White
Speaker 1: House is weighing invoking defense law to get chips supply data.
Speaker 1: Gena Amando gives firms forty five day deadline for chips
Speaker 1: supply details. The Commerce chief is concerned about chip bottlenecks
Speaker 1: and stockpilot. So essentially, this is a Cold War era
Speaker 1: national security law of force companies in the semi conductor
Speaker 1: supply chain to provide information on inventory and sales of chips.
Speaker 1: When you hear something like this, I mean we the
Speaker 1: government is looking at supply chains, looking at things that
Speaker 1: are crucial to our security. What do you think, Well,
Speaker 1: I think it's something that we're all focused on at
Speaker 1: the moment, the supply chain challenges, even talking about Nike
Speaker 1: a little bit earlier to the chip element of it
Speaker 1: as well, I think we're going to have to get creative.
Speaker 1: We feel very fortunate Cisco. We have a great supply chain,
Speaker 1: but I think all of us are trying to navigate
Speaker 1: through this and do best by our customers. But it's
Speaker 1: stressed right now, right it is absolutely give us an
Speaker 1: example of how it's stressed, of how you're experiencing that
Speaker 1: stress at Cisco Systems. So basically, like so many of
Speaker 1: our customers and partners, when you can't get access to
Speaker 1: a product or technology, we have greater lead times for
Speaker 1: our customers. The nice thing right now is because we're
Speaker 1: all in the same boat, I think our customers are
Speaker 1: incredibly understanding. But these are important build outs and so
Speaker 1: we are doing our best to prioritize to work with
Speaker 1: them to ensure that we have the partnerships that gets
Speaker 1: us access to products as quickly as we can. But
Speaker 1: it's it's a challenge. One thing I want to just
Speaker 1: end with Fran because I felt like when I talk
Speaker 1: with your company's CFO and you about the conversations, I mean,
Speaker 1: you are a senior executive there. They have put sustainability,
Speaker 1: people policy purpose at a very high level at your company. Um, financially,
Speaker 1: it makes sense for you guys to pursue all these initiatives.
Speaker 1: You see that, you see the payoff it does. It's
Speaker 1: a tremendous amount of work. I do think that the
Speaker 1: magic is that this type of work has to be
Speaker 1: both bottoms up and top down. And whenever we do
Speaker 1: that at Cisco, we win. And so what that means
Speaker 1: is the people that are closest to the supply chain,
Speaker 1: the people that are closest to the travel policy, all
Speaker 1: of us working together, and then our executives owning it
Speaker 1: and holding us accountable and measuring is really the balance
Speaker 1: and how we win. All Right, we gotta run. Thank
Speaker 1: you so much, as we covered a lot of ground.
Speaker 1: Really really appreciate it. You are listening to Bloomberg Business
Speaker 1: Week and of course to our thanks to Franca Suda.
Speaker 1: She's executive vice president, Chief People, Policy and Purpose Officer
Speaker 1: here at Cisco Systems. Here in our interactive broker studio.
Speaker 1: Not here at Cisco Systems. We're actually Bloomberg. It's been
Speaker 1: a long day, it's been a long week. It's been
Speaker 1: a long two years, right for its what it has.
Speaker 1: I'm just thinking, like, we're still this is such a
Speaker 1: big deal for her to be in person with us, right,
Speaker 1: And actually I did do a panel with Brand a
Speaker 1: while ago and it just virtually how they are doing it.
Speaker 1: We did do it virtually. Yeah, but we're getting in person,
Speaker 1: which is great for the whole Business Week team. Have
Speaker 1: a great evening. This is Bloomberg