Supply Chain Management Paper MBA

Topics: Supply chain management, Supply chain, Management Pages: 12 (3043 words) Published: December 22, 2014

MBA 13 :


Pr. K. Matthew Wong | Abdelilah Lamhazet

Supply Chain Management: Cisco Systems

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Executive Summary

The contemporary business landscape is characterized by dynamic environmental changes with intense competition. Therefore, enterprises compete on multiple competitive bases like time, cost, responsiveness and quality. Continuously changing demand pattern, short product life cycles, dynamic market, presence of multiple competitors, customer demand for customized product etc. are some of the characteristics of this business landscape. Since a business environment is characterized by continuous changes, enterprise matrix and processes must be able to respond effectively to these environmental changes. Thus, enterprises require capability to quickly adapt to the changing needs and hence, enterprise resource, systems and processes must be change proficient. Further, change pro-activity of the enterprise acts as a potent weapon against dynamic environmental changes. The enterprise matrix and processes must have flexibility as its inherent property. Cisco Systems is one of the most successful companies that have seized the strategic opportunity of rebuilding its entire supply chain to support and meet its ambitious business strategies and worldwide expansions, Cisco Systems is today a potential leader of its market and is planning to enter other segments as consequence of technological convergence, Cisco’s SC structure is recognized by international bodies that describes it as it “combines a far-reaching supply chain vision, strong execution and deep collaboration with customers and suppliers”(AMR Research Report 2009).

Supply Chain Management: Cisco Systems

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Cisco is one of a small handful of companies whose importance in business looms even larger than its market cap which was, for a while, the world's largest at the height of the dot-com boom and currently totals a hefty $159 billion. Renowned as a manufacturer of advanced routing and switching technology that provides the foundation for the Internet, Cisco is also a business case study example of growth through acquisition, its adeptness at integrating acquisitions is legendary.

Broadly Recognized Supply Chain:

The 2010 AMR Supply Chain Top 25:

“Cisco Systems has climbed steadily for five straight years, moving up two slots to No. 3 this year. Many areas of supply chain innovation have borne Cisco's mark, including supply chain risk management, multilevel demand-planning excellence and regionalized supply network architecture. The most prominent feature of Cisco's leadership, though, is probably its explicit championing of the term "value chain" as an organizational construct. By bringing together not only sourcing, production and logistics but also customer service, quality and new product launch as hard-line reporting functions, Cisco's Customer Value Chain Management organization may be a model for supply chain organizations of the future” (Gartner’s 2010 top 25 SC Report). AMR’s annual list does offer one method for determining superior supply chains. The research firm chooses its list via a methodology that includes polling of a peer opinion panel, an AMR Research opinion and three financial metrics (three-year weighted average for return on assets and revenue growth, as well as inventory turns).

Supply Chain Management: Cisco Systems

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Supply Chain Overview:

Like other tech companies, Cisco's stock and business suffered when the bubble deflated(see bullwhip effect section later in this report): the stock declining from a high of near 100 (adjusted for splits) to its present range in the mid-twenties. Times were tough. But unlike many of its Silicon Valley neighbors, Cisco now finds itself well-positioned for the coming wave of Internet growth that analysts foresee with the explosion of video and voice.

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