Governance Model used by PeterSolvik:
Meritocracies model of governance is employed by PeterSolvik, in this model of governance, the governor maintains tight control over the decision-makingprocess, but he takes the advice and views from the wider range of peoples. The community or employees from which the views are taken, see this project as the effective way of governance. The need for detail formal decision-making process is increased as there is no single individual whomakes the decision. The leaders who follow this kind of management model usually receive higher respect from the contributors because they might feel that the manager takes frequent advice and views from the wider range of stakeholders. This style of governance model is also very effective in increasing the authority of leaders because the contributor may agree with the leaders quickly because of their powerful and respectable gesture.
The meritocratic governance model ensures that every member of the team has a feeling that he is participating in the policy and decision-making process. This model provides every member of the team to contribute in the decision making, and process and also every member who participates to the success should have got a reward for his/her contribution. This is done by adifferent mechanism which improves the visibility of the decision-making process and also in the management of the decisions that were implemented.
PeterSolvik took into account the views of almost every stakeholder who has a legitimate claim over the governance of IT department. This makes it possible for the IT department to contribute to the success of Cisco. The autonomy regarding the IT systems which PeterSolvik has given to the each department head was greatly welcomed by the head of the departments and also motivated them to concentrate on the achievement of their targets. During the tenure of Peter, revenue of Cisco increaseddrastically, and the reason for this increase is the better motivation and performance of the managers who are responsible for the growth of the business.
However, in 1994 when the IT system of the Cisco goes down, the management decides to implement the ERP system. But there were many inconsistencies occurs during the implementation of Oracle primarily due to the lazy and irresponsible attitude of various managers because they were given freedom to purchase and design the software as per their desire.
Answer Number 2:
The main characteristic of the governance model of Cisco is the fragmentation of the IT department. All the individual units had given the autonomy to decide the IT budget they needed.If the departments of the company are fragmented, it results in the various advantages and disadvantages. Same is the case for Cisco;however, the fact that Cisco had benefited from the fragmentation more than the losses is a matter of great debate.
Due to autonomy that given by Peter Solvik, Cisco had taken many advantages; Cisco had grown in the time of freedom. When Peter Solviktook charge of Chief Information Officer the total market capitalization of Cisco was $100 billion, and at the time of his retirement, the total market capitalization reached to almost $500 billion.Also, the managers were more motivated to grow the business of Cisco because their rewards are linked to the performance of their departments…………………….
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