Cisco’s Strategy in Recessionary Times

Topics: Strategic management, Dot-com bubble, Recession Pages: 23 (6261 words) Published: September 13, 2013
Strategic Management, BSHCE3 at the National College of Ireland| Cisco’s Strategy in Recessionary times
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A report on Cisco’s strategic management during recessionary times|

4/4/2013
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Table of Contents
Executive Summary3
Introduction3
Literature Review3
Strategic Overview4
Acquisition Timeline6
Competitors Acquisitions8
Hewlett Packard8
Juniper Networks8
Polycom8
Strategic Tools9
SWOT Analysis9
Porter’s 5 Forces9
PEST Market Analysis Tool9
Other9
Other tools include Management by Objectives (MBO)9
Strategic Tools on Cisco10
SWOT Analysis10
Strengths10
Weaknesses10
Opportunities10
Threats10
Porter’s 5 Forces11
Threat of New Entrants: MEDIUM11
Bargaining Power of Suppliers: LOW11
Bargaining Power of Buyers: HIGH11
Threat of Substitute Products: LOW11
Intensity of Competitive Rivalry: HIGH11
PEST Market Analysis11
Political & Legal11
Economic11
Socio-Cultural12
Technological12
Financial Overview13
Reorganisation13
Technology Bubble14
Price Earnings Ratio14
Finances over the Last Decade15
Financial Observations15
Strategic Risks17
Innovation Momentum17
Acquisition Strategy17
Core Competencies17
New Markets17
Strategic Vision17
Consumer Market Penetration18
Building Revenue18
Distinction18
Conclusion19
References20
Appendix A22
Appendix B23
Appendix C24
Appendix D26

Executive Summary
This report is an examination into the strategic management practices used by Cisco Systems, Inc., over the dot com bubble from 1997 to 2000 and an overview of Cisco as a company, and its acquisitions over the past 20 years.

The report was created by Alex Quigley, Eoin McCrann and Daniel Ozac, as part of a continuous assessment deliverable as part of BSHCE3, Hons Degree in computing at the National College of Ireland. It is supported by a PowerPoint presentation of the same name, in the attached appendix. Introduction

The report will first review the literature used during the research of the topic and outline the types of information resources used during the reports generation and an overview of these findings. There is an attached overview of Cisco as a company (Appendix A) which outlines how it was founded, and its current market position, and a brief history.

Next, we will take a high level overview of their strategy and then identify the key strategic tools used by the company and how they differed at the time from their competitors in this regard. Next we will look in detail at Cisco’s acquisitions over the past 20 years since the company formed, and how this particular strategy was affected by the crash.

After this we will look at Cisco’s financials and how their strategy has enabled such large growth. The importance of their strategic choices in developing this financial growth, and finally some of the possible risks associated with the key strategic tools used by the company during this period.

Finally, a conclusion and summary of our findings and an appendix for the resource references used during the research, and an appendix of financial information. Literature Review
From the outset the base for all our research started with the case study (Indu, 2010). This gave us a very good overview of the company and how it has, over the past 20 years, faced great triumph in the face of adversity, and bounced back, particularly after difficult times throughout the company’s history In particular during recessionary times such as the dot com crash and the recent global economic downturn.

The course notes from BSHCE3 Strategic Management were used to identify the key strategic management tools. Wikipedia was also liberally used to identify and further expand on some of these tools, their founders and also as a high level overview of Cisco as a company.

Other online resources that proved very informative during research were CNN and in particular...

References: Jim Duffy. (2009). HP 's 3Com acquisition: An inside look. 
Available: http://www.networkworld.com/news/2009/111309-hp-3com-haas.html?nwwpkg=hp
John Dix. (2009). HP puts the net pedal to the metal. 
Available: http://www.networkworld.com/news/2009/091409-haas.html
wikipedia. (2013). HP puts the net pedal to the metal. 
Available: http://en.wikipedia.org/wiki/List_of_acquisitions_by_Hewlett-Packard
wikipedia. (2013). Juniper Networks. 
Available: http://en.wikipedia.org/wiki/Juniper_Networks#Major_acquisitions
Colleen Nichols. (2013). JUNIPER NETWORKS ACQUIRES ADVANCED VIDEO DELIVERY TECHNOLOGY FROM BLACKWAVE. 
Available: http://juniper.mwnewsroom.com/manual-releases/2010/Juniper-Networks-Acquires-Advanced-Video-Delivery-
Burt, Jeffrey. (2013). Juniper Buys Ankeena to Help Compete with Cisco. 
Available: http://www.eweek.com/c/a/Enterprise-Networking/Juniper-Buys-Ankeena-to-Help-Compete-with-Cisco-161910/
wikipedia. (2013). Polycom. 
Available: http://en.wikipedia.org/wiki/Polycom#Acquisitions
Cisco. (2013). Business Designation. 
Available: http://www.Cisco.com/web/about/ac50/ac142/docs/business_designation_us.pdf
Cisco. (2013). Health & Safety. 
Available: http://www.Cisco.com/web/about/ac50/ac142/docs/health_safety.pdf
Cisco. (2013). Opensource. 
Available: http://www.Cisco.com/web/about/doing_business/open_source/source/index.html
google. (2013). Finance. 
Available: http://www.google.com/finance
tradingeconomics.com. (2013). -. 
Available: http://www.tradingeconomics.com
Mourdoukoutas, Panos. (2013). Two strategy lessons for Cisco Systems. 
Available: http://www.forbes.com/sites/panosmourdoukoutas/2011/09/13/two-strategy-lessons-for-Cisco-systems/
Rose, Charlie. (2012). Charlie Rose Talks to Cisco 's John Chambers.
Little, Ken. (2012). Understanding Price to Earnings Ratio.
Available: http://stocks.about.com/od/evaluatingstocks/a/pe.htm
Colombo, Jesse. (2012). The Dot-com Bubble.
Available: http://www.stock-market-crash.net/dot-com-bubble/
Bort, Julie. (2013). Cisco Beats On Earnings, Is Right In Line For Revenue.
Available: http://www.businessinsider.com/Cisco-beats-on-earnings-is-right-in-line-for-revenue-2013-2
Travis, Tim. (2013). 12 Years After The Bubble Cisco Is Ripe For The Taking: Update.
Available: http://seekingalpha.com/article/1183801-12-years-after-the-bubble-Cisco-is-ripe-for-the-taking-update
Hardy, Quentin. (2013). Cisco Struggles to Adapt, Even as Profit Rises.
P, Indu . (2010). Cisco strategy in recessionary times. Under the direction of Vivek Gupta
Cisco Overview
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