Cisco Case Success Factors

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10/08/12 Cisco case question #1: Why, specifically, has Cisco been so successful? I- Business Strategy o Extreme profitability through market domination, achieved as quickly as possible (from GE’s playbook 12) 12 o A unique approach to technology business that is based on people, frugality, and attention to customers. o Innovation  hard nose realism (12), ability to scrap earlier efforts and move on. Separates them.  “Change is the only constant” 16 II- Winning HR approach 1 o Has voluntary attrition rate of 6% 2 o Empower teams: went from tight central mgmt making all decisions to empowerment of groups. 13 o Recruitment: HR strategy through internet instead of want ads 14  Friends program o Value people, both internally and externally  “In our industry, you are acquiring people. And if you don’t keep those people, you have made a terrible, terrible investment” (Chambers) 4 • Applies top to bottom, no rank and file without executive mgmt. retention 8 III- Brand Recognition o Ranked 25th in Fortune’s 100 Best companies to work for in America 2  Ability to hire top ten percent of people in the industry, and fit Cisco culture 8 IV- Market Diversification o 1993 Cisco changed it strategy and began to diversify into other network markets and technologies. 2  To do this required them to move out of their “religious” technology mindset into a non-religious view of technology that acknowledged that customers were the arbiters of choice. 3 o Flexible in its strategy and technology 3  “Three years ago, switching was the biggest threat to Cisco. Now they’re the leader” (Industry analyst) 3  “We let our customers decide” (CEO John Chambers) V- Pro-Entrepreneur Culture o Creative engineering team as the 70-80% of Cisco goods made in house are by ppl who started with smaller firms acquired by Cisco o People with start up experience and

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