Did you know? The logo of Cisco systems was inspired by the famous Golden Gate Bridge. This clearly proves that the founders of the company were in immense love with their city and hence that love inspired them to represent their city through its name and the logo.
The company was founded in 1984 by two computer scientists from Stanford University seeking an easier way to connect different types of computer systems. Cisco Systems shipped its first product in 1986 and is now a multi-national corporation, with over 35,000 employees in more than 115 countries.
This can only be achieved through a firm with extensive knowledge, experience, and innovative strategies. To determine the strengths of the company potential, weaknesses, opportunities, and threats, it is necessary to conduct a SWOT analysis by Cisco.
Cisco At A Glance – Cisco SWOT Analysis
Company: Cisco Systems, Inc.
Founders: Sandy Lerner | Leonard Bosack
Year of establishment: 10 December 1984, San Francisco, California, United States
CEO: Chuck Robbins
Headquarters: San Jose, California, United States
Employees (Dec 2020): 77,500
Ticker Symbol: CSCO
Type: Public
Annual Revenue (Dec 2020): US$49.8 Billion
Profit net income (Dec 2020): US$3.0 Billion
Products & Services: Networking | Switches | Routers | Wireless | Software-defined networking | Cisco Silicon One | Network management | Wireless and Mobility | security systems | WAN acceleration hardware, Energy and building management systems | Media aware network equipment | Unified computing | Unified fabric | Data centre switching | Storage networking | Cloud computing services
Company Website: www.cisco.com
Top Cisco Competitors
Competitors: Alcatel – Lucent | HP | Aruba | Huawei | Arista | VMWare | Riverbed | Juniper Networks | Huawei | Arista Networks | Dell Technologies | Extreme | HPE (Aruba) | NETGEAR | Microsoft
Cisco SWOT Analysis – SWOT Analysis Of Cisco
SWOT Analysis Of Cisco analyzes the brand based on its strengths weak points, weaknesses, opportunities, and threats. With Cisco SWOT Analysis it is clear that the advantages and disadvantages are internal factors, while threats and opportunities are external elements. Here we are going to talk about Cisco SWOT Analysis. Below Is The Detailed SWOT Analysis Of Cisco.
Cisco Strengths – Cisco SWOT Analysis
- Automation of activities brought consistency of quality to Cisco products and has enabled the company to scale up and scale down based on the demand conditions in the market.
- Strong distribution network – Over the years Cisco has built a reliable distribution network that can reach majority of its potential market.
- Strong Free Cash Flow – Cisco has strong free cash flows that provide resources in the hand of the company to expand into new projects.
- High level of customer satisfaction – the company with its dedicated customer relationship management department has able to achieve a high level of customer satisfaction among present customers and good brand equity among the potential customers.
- Highly successful at Go To Market strategies for its products.
- Strong dealer community – It has built a culture among distributor & dealers where the dealers not only promote company’s products but also invest in training the sales team to explain to the customer how he/she can extract the maximum benefits out of the products.
- Successful track record of developing new products – product innovation.
- Superb Performance in New Markets – Cisco has built expertise at entering new markets and making success of them. The expansion has helped the organization to build new revenue stream and diversify the economic cycle risk in the markets it operates in.
Cisco Weaknesses – Cisco SWOT Analysis
- Organization structure is only compatible with present business model thus limiting expansion in adjacent product segments.
- Need more investment in new technologies. Given the scale of expansion and different geographies the company is planning to expand into, Cisco needs to put more money in technology to integrate the processes across the board. Right now the investment in technologies is not at par with the vision of the company.
- Not highly successful at integrating firms with different work culture. As mentioned earlier even though Cisco is successful at integrating small companies it has its share of failure to merge firms that have different work culture.
- There are gaps in the product range sold by the company. This lack of choice can give a new competitor a foothold in the market.
- Limited success outside core business – Even though Cisco is one of the leading organizations in its industry it has faced challenges in moving to other product segments with its present culture.
- Investment in Research and Development is below the fastest growing players in the industry. Even though Cisco is spending above the industry average on Research and Development, it has not been able to compete with the leading players in the industry in terms of innovation. It has come across as a mature firm looking forward to bring out products based on tested features in the market.
- Days inventory is high compare to the competitors – making the company raise more capital to invest in the channel. This can impact the long term growth of Cisco
Cisco Opportunities – Cisco SWOT Analysis
- Stable free cash flow provides opportunities to invest in adjacent product segments. With more cash in bank the company can invest in new technologies as well as in new products segments. This should open a window of opportunity for Cisco in other product categories.
- Economic uptick and increase in customer spending, after years of recession and slow growth rate in the industry, is an opportunity for Cisco to capture new customers and increase its market share.
- Lower inflation rate – The low inflation rate bring more stability in the market, enable credit at lower interest rate to the customers of Cisco.
- The new taxation policy can significantly impact the way of doing business and can open new opportunity for established players such as Cisco to increase its profitability.
- The new technology provides an opportunity to Cisco to practices differentiated pricing strategy in the new market. It will enable the firm to maintain its loyal customers with great service and lure new customers through other value oriented propositions.
- Government green drive also opens an opportunity for procurement of Cisco products by the state as well as federal government contractors.
- Opening up of new markets because of government agreement – the adoption of new technology standard and government free trade agreement has provided Cisco an opportunity to enter a new emerging market.
- New environmental policies – The new opportunities will create a level playing field for all the players in the industry. It represent a great opportunity for Cisco to drive home its advantage in new technology and gain market share in the new product category.
Cisco Threats – Cisco SWOT Analysis
- Liability laws in different countries are different and Cisco may be exposed to various liability claims given change in policies in those markets.
- Changing consumer buying behavior from online channel could be a threat to the existing physical infrastructure driven supply chain model.
- No regular supply of innovative products – Over the years the company has developed numerous products but those are often response to the development by other players. Secondly the supply of new products is not regular thus leading to high and low swings in the sales number over period of time.
- New environment regulations under Paris agreement (2016) could be a threat to certain existing product categories .
- Shortage of skilled workforce in certain global market represents a threat to steady growth of profits for Cisco in those markets.
- Intense competition – Stable profitability has increased the number of players in the industry over last two years which has put downward pressure on not only profitability but also on overall sales.
- New technologies developed by the competitor or market disruptor could be a serious threat to the industry in medium to long term future.
- The demand of the highly profitable products is seasonal in nature and any unlikely event during the peak season may impact the profitability of the company in short to medium term.
Cisco SWOT Analysis Overview Template
This is the SWOT report that Cisco has done. Please let us know if you have additional suggestions to add.
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