Can someone objectively explain the "trouble" that Cisco Systems is currently in?

Following a 30% sell-off in stock prices over the past 12 months, Cisco CEO John Chambers issued a statement essentially stating that the company has lost it's focus and vision. In his own words Chambers stated that '...we have lost some of the credibility that is foundational to Cisco's success...We have disappointed our investors and we have confused our employees.' Can someone break down what he's talking about and what the possible solutions might be?


Andrew S. Baker (ASB) (Information Security & IT Operations Consultant, BrainWave Consulting Company, LLC)
The short answer is that for a while, Cisco owned the corporate market in a large way -- especially in the era of 'single network vendor is the best'

But now, with lots more convergence coming on the scene, VoIP, WAN optimization, Storage Area Networks (SAN), Virtualization, Unified Threat Management (UTM), Intrusion Prevention (IPS), load balancing, and many other new network-based or network-reliant technologies, many organizations have found the following:

-- Cisco isn't necessarily the best performer across all segments
-- Cisco doesn't necessarily offer the best pricing/feature value proposition in all areas
-- Other vendors have improved and closed the performance gap in many areas, while having much better pricing or support options
-- Cisco licensing is cumbersome and pricey.
-- Cisco does not adequately target the SMB market (yeah, I know about LinkSys) and that is where a lot of the growth is.

Cisco is making good strides with their new blade servers, because they are aggressively pricing them, adding useful features, and listening to customers. But, in areas where they feel themselves to be dominant, they don't tend to behave so nicely.

Now that we live in a world where vendor interoperability is the norm, Cisco is having to win their customer's business with *each* project, rather than just at the beginning of the relationship.

So, they're not in trouble in the sense that they'll be going out of business anytime soon, but rather, their CEO has finally recognized that their attitude has been a hindrance to their growth, and now other, more aggressive competitors are eating their lunch in certain markets that they consider(ed) core.

They need to get back to basic, and find a way to be more relevant across multiple market segments...
About -  Privacy -  AskEraser  -  Careers -  Ask Blog -  Mobile -  Help -  Feedback © 2014