Staying Relevant and Successful in the Best and Worst Climates - InformationWeek
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IT Leadership
Commentary
10/25/2017
02:00 PM
Gary Smith, CEO, Ciena
Gary Smith, CEO, Ciena
Commentary
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Staying Relevant and Successful in the Best and Worst Climates

A look back at a quarter century's worth of experiences that companies of all sizes can learn from

As CEO of Ciena I am often asked if I have any overarching beliefs when it comes to leadership. For me, it’s that businesses and organizations are built around people not products and services. While at Ciena we are focused on innovations that power the Internet, businesses are essentially about people. It is our people who make the technology possible.

What I don’t believe is that there is some magic formula, playbook or shortcut to successful leadership. That said, after having a front row seat in the turbulent dotcom era, I have adopted a few guiding leadership principles.

Principle 1: Have the strength of your convictions

When Ciena was established 25 years ago, our mission was to radically change the economics of telecommunications networks. After rapid ascension over a several-year period for us and many other companies in the telecom space, the unexpected happened. The dot.com bubble did a number on us – we went from $1.6 billion in revenue in 2001 to roughly $350 million in 2002. That was a humbling experience and it lead me to a key philosophy that I apply today: formulate a strategy and do not waiver.

I have been known to say, "I may be wrong, but I’m not uncertain."During this challenging period, I decided that to survive, Ciena needed to take a contrarian approach. While our competitors chose to cut staff and retreat, we chose to buckle down and carry on. We had to restructure for sure, but we made smart investments, innovated where we could and completed strategic acquisitions to expand our portfolio. In fact, during that time, our research and development (R&D) spend represented more than 50% of our revenue. But that investment was critical to ensure future growth and market relevance. 

For me personally, it was not so much a challenge in determining what types of changes we had to make, but whether we could be more judicious with our choices. My advice to others faced with challenging market dynamics is to set a strategy and stick with it.

Principle 2: Take smart risks and go big

Once we moved beyond the dot.com fiasco, we had to determine how to grow the business and leverage the foundation we’d put in place during the turbulent times. Facing sweeping changes of its own, one of our largest competitors at the time – Nortel – filed for bankruptcy and was to be split up and sold. This presented a strategic opportunity for Ciena, despite it being what I called a “bet the farm” move for us. We chose to take that bet and vigorously pursued Nortel’s MEN (Metro Ethernet Networks) business in a hotly contested auction. We emerged victorious in what now represents a game-changer in Ciena’s history. The lesson here: Leaders need to embrace smart risk, and go big when these game-changing opportunities present themselves.

Principle 3: Be agile and disruptive

In the technology sector, the velocity of change is unpredictable and unending. I think what has made Ciena one of the most successful companies in our space is that we have been agile; we have adapted; and we have continually taken steps to disrupt ourselves along the way. As an example, earlier this year, we forged new relationships with optical component suppliers, giving them the ability to offer our highly successful and patented coherent optical technology to network operators. To some, this may sound risky because they believe we are giving away our "secret sauce". But, we see this as a way to open doors to new opportunities and expand our market reach. It’s still early to predict the level of success, but I have no doubt this will prove to be another milestone in our history.

Companies shouldn’t fear disrupting themselves or challenging their sensibilities. No business – no matter how large or seemingly entrenched – is immune to disruption. It has always been my belief that if you don’t disrupt yourself, someone else will do it for you!

Principle 4: Walk the talk

It may sound like a cliché but leaders must practice what they preach. Regardless of whether you are at the height of an economic boom or struggling with lower than expected sales, leadership sets the tone for the business by demonstrating consistent, candid and authentic behaviors that empower trust and respect on the team. This goes back to my point about the people factor. The behaviors of the leadership team lay the foundation for the culture of the entire organization over time. As CEO, I take this very seriously. If I set a tone that doesn’t reflect these values, it inevitably will bleed into my leadership team and on through the company. As Winston Churchill once said, “Attitude is a little thing that makes a big difference.”

Reflecting on 25 years and looking ahead

Ciena has a history of innovation that has played a key role in how people communicate and interact each day. Our technology is behind the scenes, pushing scientific limits to support the cloud, Internet of things, smart cities and more.

Soon, the network will do things beyond our imagination and become more automated and intelligent, making decisions on its own and automatically scaling up and down as needed to handle changing user demands for bandwidth.

I have been fortunate in guiding Ciena to be a market leader, to survive and thrive in an ever-changing industry. The lessons I’ve learned have provided me insights that can hopefully help the large and established technology companies, as well as the young upstarts that will no doubt displace some of today’s leaders.

Gary Smith is chief executive officer of Ciena. 

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