Cisco's Strategy in Recessionary Times

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Case Details:

Case Code : BSTR373
Case Length : 16 Pages
Period : 2000-2010
Pub Date : 2010
Teaching Note :Not Available
Organization : Cisco Systems Inc
Industry : IT - Networking Equipments
Countries : US

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Please note:

This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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Excerpts

Background Note

Headquartered at San Jose, California, US, Cisco was incorporated on December 10, 1984. The company was founded by a group of computer scientists, who designed a software named IOS (Internet Operating System), which could send streams of data from one computer to another...

Cisco during Recession

In late October 2008, Cisco faced a reduced demand for its products in the US. The company forecasted that it would face challenges in markets like Asia and Europe too. At that time, Chambers announced that Cisco would take appropriate action proactively to face the downturn and adjust its strategies according to the changing situation...

Organization Structure

After the crisis in 2001, Cisco realized that one of the reasons for its problems was its hierarchical structure. According to Chambers, "In 2001, we were like most high-tech companies, with one or two primary products that were really important to us...

Partners and Customers

Cisco made efforts to assess how big the recession and its duration would be and to plan accordingly. The company viewed the recession as an opportunity to move closer to the customers and partners...

New Products and Markets

In spite of the recession, Cisco continued to acquire several companies (Refer to Table IV for Cisco's acquisitions during 2008 and 2009). The company entered sectors like sports and entertainment, electricity grids, consumer networking, etc...

Looking Ahead

Even in recessionary times, Cisco looked at expanding into new markets. The company predicted an annual growth of between 12% and 17% till the year 2015. It always developed its business strategies with a long-term perspective, irrespective of the macro-economic conditions...

Exhibits

Exhibit I: Cisco Systems - Quarterly Financial Statement
Exhibit II: Cisco Systems - Acquisitions (1994-2007)
Exhibit III: Cisco Systems - Three Year Financial Statements (2007- 09)

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