Abstract

The case examines the strategies adopted by the US-based Cisco Systems Inc. (Cisco) to tackle recession in the US markets in the fiscal 2008-09. Earlier, during the recession in 2001, Cisco was caught unawares leading to write down of inventory worth US$ 2.2 billion. The company reported a loss of US$ 2.69 billion for the third quarter ending April 2001. Learning its lessons from the recession in 2001, Cisco was well prepared to face the recession during the fiscal 2008-09, with a cash balance of US$ 34 billion. Cisco saw the downturn as an opportunity to invest in new technologies and emerging markets and continued to acquire several companies. During the recession, it found opportunities in the areas of virtualization, video architecture, Telepresence, collaboration and network-enabled technologies. Cisco also benefited through its unique organization structure that comprised of small groups and councils. The structure helped the company define short term goals when the projects were initiated and long-term goals for the company. Cisco also helped the partners and customers during recession by helping them adopt new technologies. With these and other initiatives to cut costs, even amidst recession, Cisco expected an annual growth between 12% and 17% by 2015.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

• Examine Cisco's growth strategies over the years.
• Understand the impact of recession in 2001 on Cisco.
• Analyze the strategies of Cisco to tackle recession in the US in the fiscal 2008-09.

Keywords

Cisco Systems Inc., Global Recession, Economic Downturn, Networked Strategy, Cisco Information Online, Just-in-Time Delivery Practices, Cisco - Game Plan for the Downturn, Focus on Finances, Focus on Customer Base, Focus on Future, Business Opportunities in Recession, TelePresence Video Conferencing Technology, Unified Computing System, Collaboration Technologies, Cisco Industry Solutions Partner Network