Cisco Systems: Using the Web for Internal Efficiency

Question 1:

Cisco Systems is the leading supplier of networking equipment and network management for the Internet in the world. Products include routers, hubs, ethernet, LAN/ATM switches, dial-up access servers and software. Because customer satisfaction has always been a core value of a successful company, customer focus has been an essential component of Cisco Systems corporate culture since the company's inception in 1984.

Since the future of the global economy is directly tied to productivity, increasing efficiency is a priority worldwide. The Internet is a proven tool for saving time and money, and for creating new revenue-generating services. It is making a positive impact in a very direct and tangible way that's important to businesses. Cisco systems is one of the most highly valued companies in the world, one part of CiscoЎЇs success is the use of Internet Operating System. This case mentioned a number of different business processes in Cisco Systems. For each of the business processes listed, several possible performance variables and related measures of performance are also mentioned.

A business process is a related group of steps or activities in which people use information and other resources to create value for internal or external customers. (Alter 2002:10) I will identify three business processes in the following.

Firstly, Cisco uses information systems, which include internal Oracle enterprise software and Internet-based systems that provided data and communication links for customers and suppliers. The quality of customer's network directly affects the business profitability, employee productivity and customer satisfaction. As the mission of Cisco is to accelerate customer success with Cisco network technology and applications that meet their business needs. The technical assistance engineering and advanced services engineering teams work together to create the tools, establish leading practices of methodology, and provide the expertise needed to support the technology. In turn, this support helps customers reduce their operational costs, increase the network availability and reliability, and reduce their time to market with network applications. Most importantly, this enables customers to build their competitive advantage and increase their productivity. (Elfrink, retrieved 11th Sept. 2006) For example, engineers, salespeople, and others who need to travel to customer sites can enter their expense reports using the Internet instead of turning in handwritten reports, this can be done quickly and efficiently. This helps for data to be entered and a report to be generated on a timely basis and avoids excessive delays, misconceptions and inaccuracies. Thus, CiscoЎЇs overall productivity is improved by eliminating waste and rework. Activity rate and output rate are important performance variables in this business process. Here, the activity rate and output rate of Cisco ia at a high level, because of number of work steps completed per day; it improves the cycle time and decreases the downtime as well.

Secondly, Cisco found distinctive methods to service its customers, performing its internal operations, coordinating with its suppliers, and successfully acquiring and assimilating other firms whose products complemented those that Cisco already had. This indicates the activity rate is high and the consistency is going well, since the company can handle several activities in a short time. For instance, Cisco is the only vendor to create a flexible and innovative suite of support programs that customers can select individually or in any combination that is right for their network. Unlike other companyЎЇs single-focus support strategies, Cisco takes advantage of resources across multiple areas of expertiseЎЄresources available through the Cisco partner network as well as from Cisco. (Moore, retrieved 11th Sept. 2006) CiscoЎЇs sales database is updated three times a day, allowing Cisco management to keep close records on whether sales goals are being met. Additionally, financial data that once took weeks to gather and verify are now collected automatically as part of doing business, this helps the company react more quickly to market shifts and competitive treats.

Thirdly, Cisco outsources much of its production, in many cases, suppliers send the product directly to customers without additional handling by Cisco. It outsources as much of its production as it can focus instead on the higher-margin interface with the customer. Cisco outsources its research and product development essentially, allowing small high-tech startups to shoulder unproductive costs, swallowing them whole when these little guys develop solutions that meet Cisco customer needs, and washing their hands of those that don't. (i2 Powers New Economy, retrieved 11th Sept. 2006) Outsourcing activities leverage the companyЎЇs competitive advantage, and then it can achieve maximum shareholder value. Outsourcing allows Cisco to focus its entire energies on its core businessЎЄthose activities at the center of its expertise, and that are the most critical to its competitive and financial success. Here outsourcing can save the time for customers since it cut the time it will take to get newly developed products into the marketplace; it also improve the output rate and reduce the downtime. Moreover, activities can be performed cheaper and better, it also reduces the companyЎЇs risk exposure to changing technology.

Question 2:

Integration is mutual responsiveness and collaboration between distinct activities or processes. (Alter 2002:100) In general, there are five different levels of integration between different business processes, including common culture, common standards, information sharing, coordination, and collaboration. In this case, Cisco Systems provides five levels of integration.

Firstly, Common culture is met at Cisco, which means sharing understandings and beliefs. In this level, people involved in two independent processes share the same general beliefs and expectations about how people communicate and work together. These shared beliefs make it easier to work together and resolve conflicts whenever necessary. (Alter 2002:102) Here, CiscoЎЇs employees have to come to expect everyday data processing tasks will be done quickly and efficiently through web-based applications, such as engineers, salespeople, and others who need to travel to customer sites can either their expense reports using the Internet instead of handwritten reports. This helps improve the companyЎЇs internal efficiency.

Secondly, Cisco in this case also meets the level of common standards, which means using