Cisco firmly believes that their staff restructuring is needed for them become more focused on their tasks, ultimately resulting to a better outcome.  Earlier estimates on Cisco’s massive layoffs were around 6,500 employees losing their jobs.  The company believes that this crucial step will reduce their annual operating expenses by $1 billion.

On Monday, Cisco has officially announced the 6,500 layoffs, along with the news of selling their set-top box plant in Juarez, Mexico to Foxconn International Holdings Ltd.  The 5,000 employees of the Cisco facility will also be turned over to Foxconn by the first quarter of 2012. Of the 73,408 current employees, 11,500 will soon be deducted from their workforce with the 5000 plant workers becoming part of the Foxconn acquisition.  Of the 6,500 losing their jobs, 2,100 of them have opted to take early retirement.  The 6,500 layoff accounts for 9% of their total workforce and 15% of the total cutoff will come from the vice presidential levels and above.

“We still need clarity around what different businesses the cuts are coming from, but Cisco has been very vocal about the fact that they are refocusing on their core businesses such as data centres, switching and routing,” Morningstar analyst Grady Burkett said.

These cutbacks also come with a hefty price–a whopping $1.3 billion or more to cover the severance and retirement pays for the employees losing their jobs.  This will start to take effect before the end of this quarter and will continue in the company’s next fiscal year in August.

But these should not alarm investors, as Cisco is proving that they are not one to back down from these small challenges.  With their recent innovations in cloud computing and security, and their recent tie-ups with companies like Schneider Electric and Mobily, things are still looking brighter for Cisco.

Minter Ellison, one of the top, full-service law firms in the Asia Pacific region, has chosen Cisco to improve their business technology for video-based collaborations and information dissemination to over 290 partners and 1,000 legal staff in Australia, Hong Kong, China, New Zealand and the UK.

“A key focus for us is to ensure that all our people — regardless of which office they are located in — are seamlessly integrated and working as ‘One Firm’ to deliver a superior client experience. With Cisco business video and data centre virtualisation technology, we’re making it easier for them to connect, collaborate and share information across the whole of the firm for the benefit of our clients,” said Peter Westerveld, Minter Ellison’s CIO.

“As a professional services organisation, communication and collaboration are an essential part of a law firm’s business. Minter Ellison is demonstrating the strategic role of the network in delivering highly responsive client service, easy access to information, increased productivity and reduced costs connecting legal teams and their clients anywhere, anytime, regardless of geography,” said Kevin Bloch, chief technology officer of Cisco Australia and New Zealand.

Cisco shows that they are just getting started with their restructuring goals, fighting through the tough times in hopes of coming out better and more efficient in the end.  Let’s just hope that these changes will not cause their downfall, or even more people will lose their jobs.