Will Cisco go on to continued fame? Or will it succumb to increasing competition? The answer isn’t clear yet, but from past few months things have been going awry at Cisco.
Of late, Cisco has announced a whopping 6,500 job cuts or 9 per cent of its full-time workforce as part of a cost-cutting blitz. The networking firm is also scaling back its operations and making endeavors to cut $1 billion from its operating expenses to stimulate profitable growth.
The company has invited lot of troubles by jumping into nearly every business. Enterprise-focused Cisco has been facing serious threat in an environment where it once excelled. Gradually, the firm is losing its sheen to competitors like Juniper and HP.
All is not yet over for Cisco. It can still regain its credibility by performing some small changes in key growth sectors.
Citing Cisco’s gloomy outlook, CEO John Chambers has put emphasis on some key changes to rectify management mistakes and the company would take some 'tough decisions' to recuperate its revenue loss.
Here are few suggestions how tech bellwether can revive its lost glory:
Hold back the buying spree
For years now, Cisco has been acquiring companies at a surprising rate. It has purchased Pure Digital for video, ExtendMedia for video content, the set-top box business of DVN for cable efforts, and many more. It has spent billions of dollars for products that, at times, are not related to its core competencies. The company is not yielding much profit from its consumer-oriented ventures and in fact is mulling over the sale of few. Its better it should restrain its buying spree rather than regretting later.
HP needs special attention
HP is strongly aiming for Cisco’s networking share with its FlexNetwork architecture and is emerging out as a serious competitor. HP has faced some hurdles over the years, but with acquisition of 3COM last year it made its most significant move to take its fight a step further against Cisco. Enterprise-centric Cisco needs to pay attention to HP’s aggressive efforts or else the PC maker, sooner or later, would knock off the networking titan.
Don’t ditch Enterprise
Enterprise or corporate world is the bread and butter for Cisco. It should stop putting so much energy on consumer-based products and get back to focusing its efforts on the enterprise segment.
The company must think genuinely about what the corporate world requirements at present. Does it need better networking technologies? Does it need a tablet? Analysing what the corporate world demands, Cisco needs to direct its focus on delivering those products.
Cloud: The next destination
If Cisco gains success over here, it could be to the cloud during the next three decades what Intel has been to the PC.
Supporting cloud computing indicates more than just selling switches and routers and managing virtualization. It signifies enabling enterprises to dynamically reallocate their resources, so that computing power can be accessed whenever and wherever they want.
Cisco still has plenty of innovation and knowledge locked inside, conditionally; it realigns its strategies and refocuses on its core areas. It can be an outright success once again by simply adhering to aforementioned ideas.
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