Contents

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1 INTRODUCTION 3

1.1 Overview of the communication equipment industry and Cisco

1.2 The rationale for selecting Cisco as the focus company

2 EXTERNAL ANALYSIS 6

2.1 Examination of market trends and dynamics

2.2 Competitive landscape analysis
2.3 Evaluation of Macro-environmental factors using PESTEL analysis
2.4 Analysis of industry life cycle stage and implications

3 INTERNAL ANALYSIS 10

3.1 Cisco's Value Chain

3.2 SWOT Analysis
3.3 VRIO Analysis

4 COMPETITIVE LANDSCAPE 14

4.1 Cisco and Its Main Competitors

4.2 Benchmarking Financial Performance
4.3 Industry Benchmarking and Conclusion

5 POSITIONING 16

5.1 Cisco's Leadership Position

5.2 Differentiation Focus or Cost Leadership
5.3 Growth Strategies using Ansoff Matrix

6 FUTURE PLANS 19

7 RECOMMENDATIONS 20

7.1.1 Leveraging Strengths

7.1.2 Address Weaknesses
7.1.3 Capitalize on Opportunities
7.1.4 Mitigate Threats

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1 INTRODUCTION

1.1 Overview of the communication equipment industry and Cisco

The communications equipment industry is a vital component of the global telecommunications

sector, encompassing a wide range of products and services that enable effective data transmission,
connectivity, and communication capabilities. According to a report by MarketsandMarkets, the
global communication equipment market size was valued at $324.6 billion in 2022 and is projected
to reach $410.5 billion by 2027, growing at a Compound Annual Growth Rate (CAGR) of 4.8%
during this period. The industry's growth is being driven by several key factors, including the
increasing demand for high-speed internet, the proliferation of mobile devices, the rise of 5G
technology, and the need for robust network infrastructure to support the growing data traffic and
bandwidth requirements. Major product segments within the communications equipment industry
include: Transmission and switching equipment, Wireless networking gears, Telecom transmission
systems, Network management software, Optical systems

The Asia-Pacific region is projected to be the fastest-growing market for communication equipment,
driven by the increasing adoption of advanced technologies, the rollout of 5G networks, and the
growing demand for high-speed internet connectivity in countries like China, India, and Japan.

In this dynamic and rapidly evolving industry, companies like Cisco Systems, Inc. play a crucial role
as a leading provider of networking hardware, software, and services. Cisco's product portfolio
includes routers, switches, wireless access points, security appliances, and collaboration tools,
catering to the diverse needs of enterprises, service providers, and individuals globally.

CISCO SYSTEMS, Inc.

Cisco Systems, Inc., founded in 1984 by Leonard Bosack and Sandy Lerner, is a global technology
leader that designs, manufactures, and sells networking equipment, software, telecommunications
equipment, and high-technology services. Headquartered in San Jose, California, Cisco has
established itself as a pioneer in the digital communications industry, with a strong focus on specific
tech markets such as the Internet of Things (IoT), domain security, videoconferencing, and energy
management. Cisco offers a wide range of leading products, including Webex, OpenDNS, Jabber,
Duo Security, and Jasper.

Over the years, Cisco has solidified its position as one of the largest technology companies in the
world, with a significant presence in the market. As of March 2023, Cisco's market capitalization
stood at approximately $216 billion, making it one of the most valuable technology companies
globally. The company has a diverse workforce of over 83,000 employees across more than 115
countries.

Cisco's financial performance has been impressive, with a strong track record of growth and
profitability. In fiscal year 2022, the company reported revenue of $51.6 billion, representing a year-

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 over-year increase of 2.7%. The company's net income for the same period was $11.8 billion, with
an impressive net profit margin of 22.9%. Cisco's strong financial position has enabled it to invest
heavily in research and development, with approximately $6.8 billion allocated for R&D in fiscal
year 2022.

Cisco's diverse product portfolio and strong market presence have enabled the company to establish
strategic partnerships and collaborations with industry leaders across various sectors. For instance,
Cisco has collaborated with technology giants such as Apple, Google, and Microsoft to enhance
network and cloud services, while also partnering with leading telecommunications companies to
drive the adoption of 5G and other emerging technologies.

1.2. The rationale for selecting Cisco as the focus company

1.2.1. Industry Leader

Cisco holds the top spot across almost all enterprise networking categories from core routing, wireless
access, and SD-WAN to network security. It has more than 60% market share in core switching.
Analyzing the dominant industry player reveals key sources of competitive advantage and future
strategic priorities that other vendors emulate. It also has a strong brand reputation and extensive
product portfolio making it a preferred choice for businesses.

1.2.2. Infrastructural Strength

Cisco equipment runs most of the Internet's infrastructure. Its routers handle more than 80% of the
Internet traffic. This showcases exemplary execution on how Cisco manages global supply chains and
operates such a massive installed base providing prototypical benchmarks for infrastructural
operations

1.2.3. Diversified Business

Cisco has successfully diversified into cybersecurity, collaboration, cloud, data center, edge
computing, optical systems, etc., which computes about $50 billion. This allows a well-rounded
analysis of platform/solution sales capabilities beyond point products while evaluating expansion
options. Being already a $50B giant provides sufficient complexity.

1.2.4. Global Company with massive reach

Cisco sells products and services to over 500,000 customers across various countries showcasing the
ability to understand geographic nuances. About 30% of sales come from outside the Americas
highlighting global expansion success. Assess globalization aptitude and localization strategies. With a
presence in over 180 countries, Cisco has established a strong global footprint that allows it to serve a
wide range of industries and markets. The company's extensive network of partners and distributors
further enhances its reach and accessibility to customers worldwide

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1.3 Application of Porter's Five Forces model to analyze industry attractiveness.

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2. EXTERNAL ANALYSIS:

2.1. Examination of market trends and dynamics in the communication equipment industry

2.1.1. Mainstreaming of 400 ZR Optics

 Requires new core networks with improved control/user plane separation, and multi-access
edge computing capabilities
 Driving demand for dense fiber optic connections to small cell sites using fiber cable, mesh
wireless backhaul
 Enables new enterprise use cases like industrial automation, smart utilities, expanding
addressable market
 Allows equipment vendors to bundle 5G core with existing routing and switching
infrastructure
 Favoring vendors with end-to-end product capabilities spanning wireless and wireline
domains

2.1.2. WiFi 6 Adoption

 WiFi 6 perforation in smartphones and other communication types of equipment is still low
indicating significant upgrade potential as replacement cycles happen
 Opens up precision sensing use cases for location services and improved IoT support in
facilities
 Enterprise preference for established vendor networks limits disruption from new entrants
 Service providers introducing WiFi 6 offerings for small-medium businesses to expand
revenues

2.1.3. Open RAN

 Open RAN is an approach to designing and implementing radio access networks in
telecommunications that promotes an open and interoperable architecture, allowing for
flexibility and vendor diversity.
 Cost Reduction and Competition: Open RAN fosters competition among vendors, leading to
cost-effective solutions, reduced dependency on single suppliers, and overall lower network
deployment and maintenance costs.
 Interoperability and Innovation: Open RAN enables interoperability between components
from different vendors, encouraging innovation, faster network upgrades, and the adoption of
new technologies to meet evolving communication needs.
 Implementing Open RAN may pose challenges in terms of integrating components from
various vendors, potentially leading to interoperability issues and increased complexity in
network management

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2.2. Competitive landscape analysis including key competitors of Cisco

2.2.1. Direct Competitors:

 Huawei - Major leader in global telecom equipment. Competes across network switching,
routers, and WLAN, network security products like firewalls etc. Huawei leverages cost
advantages and its focus on China.
 Juniper Networks - Leading high-end routing, data centers, automated LAN, and switching
for various service providers. Also caters to cloud players, provides support by improving
network security, constant troubleshooting, and also US-based services for the government to
meet their security requirements
 Nokia - Strong in network management and automation software. Their key account focus is
on European telecom firms. Services that they provide like OSS, Wing, and Data
Marketplace for industries and public sectors
 Arista Networks - Specialized in data center switching. Caters to major players like Facebook
and Microsoft. Major services they provide are data center, Cognitive Wi-Fi and security
products.
 Extreme Networks - Focuses on switching, wireless LAN and network management
software. Majorly gains its share via acquisitions. Services like Wired and wireless access,
network security and fabric

2.2.2. Emerging Competitors:

 Cloud Companies - AWS and Microsoft Azure offer their networking functionality bundled
with cloud adoption in the form of services like Virtual Private cloud, networking solutions
for hybrid and multi-cloud environments
 Software-defined Networking - VMware NSX, Cumulus Networks provide network
virtualization capabilities like programmability through its Linux-based operating system,
and enhancing overall network security
 White Box Hardware - Acton, and Delta Networks sell bare metal switches at low cost which
act as an alternative to traditional network hardware and building customized network
infrastructure

2.3. Evaluation of Macro-environmental factors using PESTEL analysis

2.3.1. Political Factors:

2.3.1.1. Government Policies: As Cisco operates globally, it has to navigate diverse regulatory
environments. Numerous changes in trade policies, tariffs, and international relations impact its
business.

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2.3.1.2. Cybersecurity Regulations: Governments worldwide mainly focus on cybersecurity.
Compliance requirements impact Cisco’s products and services if not adhered to those
requirements.

2.3.2. Economic Factors:

2.3.2.1. Global Economic Conditions: Economic downturns can reduce IT spending, which can
affect Cisco’s revenue. Conversely, economic growth also drives demand for networking
solutions of Cisco.

2.3.2.2. Currency Fluctuations: As a multinational company, Cisco is exposed to exchange rate

risks of various countries and needs to take into account various factors.

2.3.3. Social Factors:

2.3.3.1. Digital Transformation: The shift toward digitalization is impacting Cisco’s offerings.
Social trends influence technology adoption and connectivity needs of not only individuals but
also many multinationals.

2.3.3.2. Workforce Trends: Collaboration tools, Remote work, and changing work patterns affect
demand for Cisco’s products.

2.3.4. Technological Factors:

2.3.4.1.5G and IoT: Cisco’s success depends a lot on its ability to adapt to emerging
technologies like 5G, Open RAN, SD-WAN, and the Internet of Things (IoT).

2.3.4.2. Software-Defined Networking (SDN): SDN disrupts traditional networking models, and
Cisco must stay competitive in this space for it to remain a market leader.

2.3.5. Environmental Factors:

2.3.5.1. Sustainability: Increasing awareness of the environmental impact drives demand for eco-
friendly solutions. Cisco’s green initiatives and energy-efficient products are crucial for it to
maintain its competitive edge.

2.3.5.2. Supply Chain Resilience: Environmental risks (natural disasters, climate change) can
disrupt supply chains. Cisco must ensure resilience.

2.3.6. Legal Factors:

2.3.6.1. Intellectual Property Protection: Cisco’s innovations require robust IP protection.

2.3.6.2. Antitrust and Competition Laws: Compliance with antitrust regulations is essential in a
competitive market.

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2.4. Analysis of industry life cycle stage and implications for Cisco's strategy

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3. INTERNAL ANALYSIS
3.1. Cisco’s Value Chain
3.1.1. Inbound Logistics:
Cisco follows a highly efficient and flexible "Virtual Manufacturing" strategy, relying heavily on
contract manufacturers like Flextronics, Foxconn, Sanmina-SCI etc. This provides significant savings
through Inventory Carrying, Holding Costs and working capital requirements. Cisco maintains close
partnerships with over 1000 component suppliers through vendor managed inventory and just-in-time
procurement system. This ensures a steady supply of inputs and leads to low procurement costs due to
economies of scale.
3.1.2. Operations:
Cisco's networked manufacturing processes, just-in-time production systems and integrated supply
chain management contribute significantly to its industry leading gross margins of around 63%.
Cisco's strategic approach to manufacturing emphasizes three key principles: Standardization,
Modularity, and Postponement Techniques.
 Standardization: By standardizing manufacturing processes, Cisco ensures consistency and
uniformity in the production of its products. Standardization involves establishing common
procedures, specifications, and quality standards across different product lines.
 Modularity: Cisco's focus on modularity enables the creation of flexible and scalable product
architectures that can be easily customized or upgraded.
 Postponement Techniques: By postponing product differentiation and customization, Cisco
reduces inventory holding costs, minimizes the risk of excess or obsolete inventory, and
improves supply chain agility.
3.1.3. Outbound Logistics:
Cisco has invested heavily in a seamless logistics infrastructure with leading delivery service providers
like UPS and FedEx. This enables speedy, reliable, and real-time product delivery globally. Cisco uses
UPS' Flex Global View tool to get real-time tracking and visibility into its shipments across over 220
countries. It leverages UPS's extensive air and ground network to optimize time-in-transit. For large
volume or heavy shipments, ocean freight and intermodal rail transport are used. This enables cost-
effective distribution to global markets. Cisco has also partnered with UTi Worldwide and DAMCO
Logistics to improve its ocean freight operations, reducing transit times by up to 5 days.
3.1.4. Marketing & Sales:
With an expansive sales force of 25,000+ employees worldwide and a vast channel network of 9500+
partners, Cisco has unmatched global market reach, customer access, and visibility. Cisco employs a
consultative, solution-based sales approach focused on long-term customer relationships rather than
pure transactions. The sales force follows a "Land and Expand" strategy focused first on gaining new
customers and then growing business from existing accounts. Cisco leverages a vast global partner
ecosystem of over 9500 channel partners, distributors, service providers, system integrators, and sales
agents to expand its reach. Top partners include CDW, Logicalis, Dimension Data, IBM, AT&T,
Telstra, etc.
3.1.5. Service:

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Cisco has over 200 Customer Assistance Centers globally that provide technical support in over 30
languages. It offers 24/7 global technical assistance through phone, chat and social media to help
customers with issues, troubleshooting, bug fixes etc. It also provides various hardware and software
support services like updates, upgrades, replacements, installations, consulting etc. through service
contracts. Cisco has gained strong industry recognition for its customer support - it has ranked first in
networking support for 13 years by Technology Services Industry Association. Cisco is also investing
heavily in using AI, machine learning and automation capabilities to enhance customer support and
success.

3.2. SWOT ANALYSIS: To assess Cisco's internal strengths and weaknesses

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3.3. VRIO ANALYSIS: To evaluate the sustainability of Cisco's competitive advantage
VRIO Analysis
Cisco's competitive advantage stems from its valuable, rare, costly ability to imitate resources and
capabilities that the company has effectively organized to capture value. The VRIO framework
analysis reveals several key sources of Cisco's strong market positioning:
3.3.1. Intellectual Property Rights, Copyrights, and Trademarks
Cisco's intellectual property portfolio, including patents, copyrights, and trademarks, is extremely
valuable in thwarting competition. These IP assets are rare and competitors find it extremely difficult
to copy or replicate. The risk of imitation is low given the company's aggressive IP protection
strategies. While Cisco has not fully exploited the potential of these assets yet, they provide a strong
and sustainable competitive advantage.

3.3.2. Global and Local Presence

Cisco's widespread global and local presence across markets diversifies its revenue streams and
insulates against economic cycles in any particular region. This presence is valuable, and while
competitors can imitate it, doing so is costly. Cisco has effectively organized itself to leverage this
presence, providing a strong competitive edge.
3.3.3. Track Record of Project Execution
In an industry prone to cost overruns, Cisco's proven track record of successfully executing large-scale
projects is highly valuable, rare, and difficult for rivals to imitate easily. This capability is well-
organized within Cisco, conferring a strong sustainable advantage.
3.3.4. Product Portfolio and Synergies
Cisco's diverse product portfolio caters to varied customer segments and preferences. The synergies
across product lines are valuable in cross-selling opportunities. While imitable, doing so is costly for
competitors. Cisco has effectively utilized this resource to its advantage.
In contrast, resources like distribution/logistics costs, sales force, and channel management do not
significantly contribute to competitive advantage for Cisco.
Overall, Cisco's intellectual property, global presence, execution capabilities, and synergistic product
portfolio - being valuable, rare, costly to imitate, and well-organized - form the bedrock of its strong
and sustainable competitive advantages in the market.

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 4. COMPETITIVE LANDSCAPE
In the evolving sphere of the communications equipment industry, the strategic positioning of key
players significantly influences market dynamics and technological advancements. This section of
the report focuses on Cisco Systems Inc., a formidable entity in this sector, and conducts a
comparative analysis with its principal competitors. The rationale behind this comparison is to
delineate Cisco's competitive edge, market performance, and strategic orientation about other
industry leaders.
4.1 Cisco and Its Main Competitors
Cisco, founded in 1984, is a global leader in networking hardware and software, with a revenue of $57
billion and a market share of 41% in enterprise networks. Its strengths lie in network infrastructure,
cloud security, and collaboration solutions.
In contrast, Huawei, with a revenue of $103 billion, focuses on telecommunications equipment and
networking gear, including 5G networks. Arista Networks, a younger company established in 2004,
specializes in cloud networking and high-speed ethernet switches, holding 7.6% of the switch market.
VMware, known for cloud computing and virtualization software, and Dell Technologies, a major
player in IT and cloud solutions, also present as strong competitors. Extreme Networks, focusing on
networking software for enterprise and cloud, and Aruba Networks, a subsidiary of HP specializing in
SD-WANs and wireless networks, are other notable competitors.
Motorola Solutions and Nokia, both with a long history, focus on communications equipment and
mobile/fixed network solutions, respectively. F5 Inc and Juniper Networks are key players in
application delivery, security solutions, and AI-driven networks.

4.2. Benchmarking Cisco's financial performance using key ratios and industry benchmarks

4.2.1. Financial Health

Cisco's financial health, as indicated by its market capitalization of approximately $197.62 billion in
2023, establishes it as a dominant entity in the technology sector. This substantial market cap not only
reflects investor confidence but also underscores the company's significant role in the industry. The
Price to Earnings (P/E) ratio of 14.78 and Price to Sales (PS) ratio of 3.44 further reinforce this
perspective. The P/E ratio, in particular, suggests a balanced market valuation of Cisco's earnings,
neither undervalued or overvalued in comparison to sector averages. Such a ratio is indicative of
investor trust in Cisco’s steady growth trajectory and prudent management practices.

4.2.2. Liquidity and Solvency

The liquidity ratios, including the Quick Ratio of 1.10 and the Current Ratio of 1.37, point to Cisco's
competent management of liquid assets to cover short-term liabilities. These ratios are crucial for
maintaining operational flexibility and resilience in the face of market fluctuations. Moreover, the
Debt-to-Equity ratio of 0.25 illustrates a conservative approach towards leveraging, which is
instrumental in minimizing financial risk and ensuring long-term solvency

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4.2.3. Operational Efficiency

Cisco's operational efficiency is depicted through its Asset Turnover ratio of 0.57. While this ratio
indicates a moderate level of efficiency in using assets to generate revenue, it is aligned with the
norms of the technology sector, where heavy investments in R&D and infrastructure are common.
This ratio should be viewed in the context of the industry's high-intensive capital sectors. Cisco's
balanced approach towards asset utilization is reflective of its strategic focus on long-term growth and
sustainability, rather than short-term gains.

4.2.4. Profitability Ratios

Cisco's Return on Equity (ROE) of 30.20% is particularly impressive, showcasing its capability to
generate substantial returns for shareholders. This high ROE is indicative of effective management and
profitable allocation of equity. Similarly, the Return on Assets (ROA) of 13.50% demonstrates Cisco's
adeptness in utilizing its assets to generate profit. These profitability ratios, particularly when
compared to industry averages, highlight Cisco's strong position in generating value and earnings.

4.3 Industry Benchmarking and Conclusion

When benchmarked against industry standards, Cisco's financial ratios portray a company that is not
only financially robust but also strategically positioned for continued growth. Its market valuation
ratios suggest a stable and realistic investor expectation, while its liquidity and solvency ratios indicate
a sound financial structure capable of withstanding market volatilities. Operational efficiency metrics,
although moderate, align well with industry norms, considering the capital-intensive nature of the
technology sector.

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5. POSITIONING

Cisco Systems enjoys a leadership position in enterprise networking and communications equipment
globally based on year-over-year market share gains across domains like routing, switching, security,
and collaboration tools driven by best-in-class product innovation and customer support capabilities.

5.1.1. Market Leadership across Product Domains

Cisco Systems, achieved over $51.6 billion in net revenue in fiscal 2022, solidifying its position as a
major player worldwide. The company holds majority market share in key Americas regions,
including 63% in enterprise ethernet switches, 58% in service provider routers, and 48% in security
appliances. Cisco also saw an 8% growth in its core switching business, demonstrating continued
momentum and market strength. These successes highlight Cisco's position as a dominant force in the
IT industry, poised for further growth and innovation.

5.1.2. Sources of Competitive Differentiation

Cisco Systems invests over $6 billion annually, representing 13% of its revenue, in research and
development focused on proprietary hardware and software. Leveraging homegrown IP like custom
silicon and chip designs, Cisco drives innovation in core network infrastructure products. The
company has built an end-to-end ecosystem spanning hardware, OS software, analytics, and policy
tools, along with partnerships across technology vendors. Cisco's global technical support
infrastructure manages intricate deployments and supports over a billion networked devices. These
initiatives underscore Cisco's commitment to innovation and customer support, solidifying its position
as a global IT leader.

5.1.3. Strategic Brand Positioning

Cisco Systems maintains a premium position in the IT industry, driven by its pioneering innovations,
quality, reliability, and industry-leading performance. Analysts consistently rate Cisco as a leader in
high-growth segments such as cloud networking, network security, data center switching, and SD-
WAN. The company is a trusted partner in enabling digital transformation initiatives across private
and public cloud environments. Cisco's constant focus on expanding customer value allows it to
command pricing power, reinforcing its position as a leader in the market.

5.1.4. Growth and Competitiveness Dynamics

Cisco Systems is shifting towards software and subscription revenues, aligning with as-a-service
models. Despite margin pressures from competitors like Arista in high-performance data center
switching, Cisco's scale, innovation, and customer support capabilities are hard to replicate. The
company is exploring growth in multi-cloud management, unified operating systems, and analytics-
driven automation, with potential for inorganic expansion in observability. Cisco's strategic
positioning underscores its leadership and potential for future growth in the IT sector.

5.2. Does Cisco have a differentiation focus or cost leadership?

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Cisco leverages product and service differentiation across its enterprise networking portfolio more so
than cost leadership as its primary competitive strategy. This is evidenced by its 13% annual R&D
spend leading to proprietary hardware/software innovations, extensive professional and managed
services offerings, and a premium brand positioning validated by 63-65% gross margins.
Cisco's high-performance infrastructure products like Nexus switches, Silicon One chipsets command
significant pricing power based on a large technical capabilities gap compared to competitors.
Enterprise customers are willing to pay premium prices given greater speeds, feeds, analytics
capabilities, and lowered TCO driven by automation.
Cisco does not follow a cost leadership approach as large R&D investments and premium customer
experiences are vital to maintain technology and market leadership.

5.3. Cisco’s growth strategies using the Ansoff Matrix framework

5.3.1. Market Penetration

Cisco has focused significantly on increasing market penetration of its enterprise networking and
security solutions portfolio to drive growth, especially across the Americas and EMEA regions which
jointly contribute almost 80% of revenues.
Specific initiatives include providing additional discounts and financing options via channel partners
to stimulate demand, optimizing go-to-market motion with both direct sales and VARs based on
customer size and vertical, and targeted upsell/cross-sell promotions to expand share of wallet.
Evidence of success through 8% order growth last fiscal across core switching portfolio.
This also involves aggressive portfolio actions to capitalize on technological transitions like upgrading
customer bases to 400G ethernet, WIFI 6, and secure SD WAN solutions. Expansion of global
distribution through continued investments in channel partnerships and e-commerce enablement in key
emerging markets form another penetration avenue.
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5.3.2. Product Development

With 200+ acquisitions, Cisco has continually invested in expanding its total addressable market
through developing and commercializing new products in high-growth domains via both organic and
inorganic routes.
Recent examples include offering its unified SASE cloud platform Cato Networks, the launch of
cloud-managed SD-WAN services, Observability suite using capabilities of acquired businesses, and
continuing innovation pipeline around Silicon One chipsets, Nexus data center switches, etc. New
solutions are also aligned to emerging networking needs around multi-cloud and hybrid environments.
There are now new product lines available, such as Meraki cloud-managed infrastructure and ACI and
DNA Centre for policy-based automated networks. Additional categories supported by internal R&D
are multi-cloud networking management and IoT connectivity. Using network intelligence for use
cases like location analytics and digital experience monitoring, Cisco is also venturing into SaaS
applications.

5.3.2. Market Development

Cisco has been strategic in targeting growth across select international markets. It evolved go-to-
market from largely a direct sales model earlier to working with over 11000 global channel partners
today to amplify reach in countries like India and China. Further enhancing partner incentives to
develop new opportunities in Latin America, Canada, and the Middle East.
Cisco is launching strategic market development initiatives to target new customer categories outside
of its conventional base as business networking requirements change. This comprises specialized
vertical solutions that are matched to particular use cases in the government, industrial, smart city, etc.
sectors. The extensive services infrastructure and ability to co-develop solutions tailored to country-
specific business needs will continue generating new market growth possibilities, especially across
Asia and Japan. Acquisitions have made it possible to enter lucrative adjacent markets quickly, such as
5G networks and telco cloud infrastructure. To promote uptake, complementary go-to-market
initiatives through system integrators and service providers are being formed.

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6. FUTURE PLANS
6.1. Invest heavily in cloud-native networking
 Create specialized engineering teams to re-architect NX-OS and IOS, two of the main
network operating systems, as cloud-native platforms.
 Construct automated CI/CD pipelines to enable cloud networking software to be rapidly
iterated and deployed.
 Collaborate and closely integrate with public cloud providers through joint development
6.2. Quicken the Shift to SaaS/Cloud Networking Solutions:
 Make full use of Cisco's software expertise to convert key networking devices, such as
switches and routers, to cloud-native, SaaS delivery models.
 Expand on innovations like Meraki cloud networking to offer businesses and service
providers safe, scalable "Networking-as-a-Service" options.
 Facilitate the integration of on-premises and cloud-hosted networking infrastructure under a
single management system to provide seamless hybrid operating models.
6.3. Multi-Cloud Networking:
 Use closely integrated networking and security solutions to take advantage of the expanding
enterprise multi-cloud usage.
 Assist hyper scalers such as AWS, Azure, and GCP in close collaboration to create
automated hybrid and multi-cloud connectivity fabrics.
 Offer comprehensive governance, analytics, and observability for both public cloud and on-
premises networks.
6.4. Vertically Integrate and Monetize Silicon/Hardware:

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  Invest more in specialized hardware acceleration such as ASICs, DPUs, and optics by
leveraging acquisitions like Acacia and Leuba.
 Extract revenue from silicon/system designs via silicon subscription and chip monetization
models
 Implement comprehensive hardware root of trust, supply chain security and lifecycle
management capabilities
6.5. Lead 5G/Wi-Fi 6 Transitions for Service Providers:
 Extend industry-leading routing/switching position into emerging 5G mobile infrastructure
opportunities
 Provide converged wired/wireless solutions combining Wi-Fi 6/6E access with secured SD-
WAN fabric for enterprises
 Leverage Software-Defined architectures and open interfaces (Open RAN) to disrupt
proprietary RAN vendors
6.6. Unify Security and Networking under SASE Architecture:
 Converge Cisco's security and networking portfolios into a holistic Secure Access Service
Edge (SASE) platform
 Integrate SD-WAN, cloud security, zero trust access, SaaS acceleration under a single-pass
architecture
7. RECOMMENDATIONS:

7.1.1. Leveraging Strengths:

 Capitalizing on High Switching Costs: Leveraging Cisco's also established position in core
networking infrastructure to drive cross-selling of adjacent products and services like
security, routing, switching, and cloud offerings and customer retention.
 Expand its Service Offerings: Build upon Cisco's expertise and extensive ecosystem with
various partners to offer more comprehensive managed services, consulting, and support
offerings, which would deepen customer relationships, and satisfaction and generate
recurring revenue streams.
 Product Portfolio Diversity: Leverage Cisco's diverse product portfolio to create integrated
solutions to address customers' ever changing and evolving needs, particularly in areas like
IoT, cloud computing, and digital transformation.
7.1.2. Address Weaknesses:
 Restructuring Teams: Conduct a thorough analysis and review of Cisco's organizational
structure and decision-making processes. Implement a flatter and decentralized structure with
structured product teams and streamlined approval processes to enhance responsiveness and
agility.
 Accelerating Cloud Transition: Develop an in-depth and comprehensive strategy to transition
from traditional hardware-based revenue models to cloud-based subscription models and as-
a-service offerings, to align with industry trends and customer preferences.
 Training and Development: Implement comprehensive training programs for Cisco's
workforce to get hands-on experience in cloud technologies, software development, and

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 emerging domains in this industry like SD-WAN, Wi-Fi___33 6, AI-ML, and IoT.
Incentivize constant learning and certifications to build domain expertise among the teams
7.1.3. Capitalize on the Opportunities
 Unified Multi-Cloud Management Platform: Launch a multi-cloud management platform that
simplifies the various processes like optimization, deployment, and governance of
applications and networking across public and private clouds. Integrate automated
provisioning and cost optimization by using AI/ML.
 Set up Vertical Solutions Units: Establish vertical solutions units that would be focused on
developing industry-specific solutions tailored for specific sectors like healthcare,
manufacturing, and smart cities. Also, leverage partnerships and acquisitions to accelerate
time-to-market to stay ahead of the competition.
 Diversify SaaS Portfolio: Identify opportunities to transform Cisco's existing software
offerings into SaaS applications, leveraging cloud-native architectures and subscription
models. Additionally, develop more SaaS products in areas like network monitoring, security
analytics, and digital experience management.
7.1.4. Mitigate Threats:
 Establish an Open-Source Strategy: To lower the risk of disruptive open-source alternatives,
Cisco must develop a clear plan for embracing and integrating open-source technology into
its product line. This could entail investing in open-source businesses, developing hybrid
solutions, or donating to open-source projects.
 Implement Agile Supply Chain: By expanding inventory buffers for essential components,
changing up Cisco’s supplier base, and putting real-time supply chain visibility and analytics
technologies in place, it can transform the supply chain model into one that is resilient and
flexible.
 Enhance Cybersecurity Skills: By acquiring security companies, forming specialized security
R&D teams, and creating cutting-edge threat detection and response systems to handle
changing cyber threats, Cisco may bolster its cybersecurity capabilities.
 Form Regulatory Compliance Units: Assign a specific regulatory compliance unit to oversee
and guarantee compliance with applicable laws, rules, and trade policies throughout global
operations. Develop contingency plans for potential geopolitical shifts or regulatory changes.

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