Business Strategy and Innovation of Cisco Systems Inc Essay

5334 Words Mar 6th, 2013 22 Pages
EXECUTIVE SUMMARY

The purpose of the report was to discuss the business strategy of Cisco Systems Inc (Cisco), a company widely considered innovative. The report was to discuss the justification of Cisco’s status of innovative, how the business environment impacted on Cisco and it’s opportunities for innovation, their sources of competitive advantage, strategic options available to Cisco, and evaluate the risks of implementing the strategic change to achieve this option

This was done by evaluating Cisco’s current strategies, its business environment and markets, applying strategy frameworks in the context of its industry and innovation, and by analysing the risks that could be associated with implementing this change.

Cisco
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They have 7 major laboratories in locations around the world, and employ around 20,000 engineers (Cisco, 2012). The diversity of basing these facilities all over the world will only help to aid innovation, as the people can use their own cultures and experiences to develop new product and services, thereby helping to develop worldwide solutions to global industry problems. Yearly Cisco invests over $5 Billion on R&D (Cisco, 2012).

With regards to their ‘Buy’ aspect of their innovation strategy, Cisco is constantly looking to acquire technologies to improve their current product range. Cisco has acquired over 160 companies up to the end of 2012, and will continue to actively seek out acquisition opportunities to increase their product range (Cisco, 2012). It may be argued that innovation by acquisition is not innovation; however the innovation comes with the integration of these technologies into their existing product ranges and taking new products to market. Cisco also purchase technologies that have yet to be brought to the market, so are more inventions than innovations, and take calculated risks in doing so.

Cisco’s approach to innovation is an open one, and they have many strategic partnerships. Cisco is aware that to maximise the potential of their products, they must rely on the products of other

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