Innovation Management Report: Cisco systems PDF

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Choose a company you are interested in that is considered to be innovative. Describe the company; describe the innovation and analyse the innovation management process, e.g. where did the idea for this innovation came from (source of innovation), how was the innovation management process organised; ...

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Cisco Systems Innovation Innovation Management

KU: K1705601 Module Code: BS7044 Word Count: 1933 words

Table of Contents EXECUTIVE SUMMARY................................................................................................................. 2 INTRODUCTION TO CISCO & BACKGROUND INFORMATION...........................................3 COMPETITORS........................................................................................................................................3 CISCO’S INNOVATION TIMELINE.............................................................................................................3 CISCO’S INNOVATION PROCESS AND MANAGEMENT......................................................... 4 CISCO’S SOURCE OF INNOVATION..........................................................................................................4 CISCO 1ST INVESTMENT CAPITAL............................................................................................................5 THE INNOVATION / OPEN INNOVATION...................................................................................................5 CISCO MANAGEMENT PROCESS.............................................................................................................5 .................................................................................................................................................................6 CISCO’S OPEN INNOVATION PLATFORM..................................................................................................6 CISCO’S IMPACT & THE FUTURE OF IT’S INNOVATION...................................................... 8 REFERENCES.................................................................................................................................. 10

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Executive Summary This report consisted of a company I chose because they demonstrated an effective practice of innovation. Sandy Lener and Lenardo Bosack founded cisco Systems In 1984 Cisco Systems. The high-technology company produces, manufactures, and sells networking hardware, software, telecommunications equipment, and other hightech products. Within this report, I’ll discuss the ideation behind Cisco’s innovation and analyse their innovation management process and where it stemmed from. Cisco innovation efforts, such as promoting a positive and supportive work environment, use various approaches for innovation. As well as the company's improved innovation strategy, acquisitions and partnerships are main contributors to the company's substantial progress, as outlined in the report. Cisco prioritized the value of innovation and its support for it. They created innovative challenges within the company to include employees in the process and incorporate the value of its products not only for the customers but also for the employees. Through open-source partnerships, venture capitalism, and CSR investments, the enterprise gains external innovation insights to continue its contribution to technology's leading world.

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Introduction to Cisco & Background Information In 1984 Cisco Systems was founded by Sandy Lener and Lenardo Bosack, two computer scientists from Stanford University. Cisco is a high-technology company that produces, manufactures, and sells networking hardware, software, telecommunications equipment, and other high-tech products or services. Cisco Systems shipped its first product in 1986 and is now a multi-national corporation, with over 35,000 employees in more than 115 countries (Cisco Systems, Inc, n.d). Cisco sold its first product, a network interface card for digital equipment computers, its first big success a router that served multiple network protocols came the following year (Lewis, 2017). Competitors Cisco faces challenges on all fronts, with such a diverse product portfolio and enormous financial capital, allowing other megacorporation’s and even small rivals to thrive. Cisco’s top three competitors are HPE (Aruba), Juniper Networks & Huawei. HPE (Aruba): Aruba is a networking and security solution provider and distributor founded in the United States in 2002 and purchased by the Hewlett Packard Enterprises company in 2015. Aruba is the main competitor of cisco a leader in the wireless or WLAN infrastructure market, wither it remains a 45% stake (WCS, n.d). Juniper Networks: Juniper Networks is an American networking software firm founded by Pradeep Sindhu in 1996 . Juniper is one of the youngest companies in this area, it has been taking Cisco’s market and maintained year-on-year growth, positioning itself as its second strongest competitor (WCS, n.d). Huawei: Ren Zhengfei founded Huawei, one of the world's largest technology firms, in 1987 in China. The company competes with Cisco with their services and products such as networking, optical transmission and access, cloud data centre, servers, intelligent computing, enterprise wireless and more (WCS, n.d). Cisco’s Innovation Timeline

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Cisco’s Innovation Process and Management Cisco’s Source of Innovation Cisco's first offering was a digital interface card for computers made for Digital Equipment Corporation. However, it was not the root of the company's creativity. Its first significant innovation breakthrough came the following year by introducing a router that supports various network protocols. Early troubles arose for the company as they were labelled imitators. Second movers targeted the market by producing an identical product that another firm already offered. Both founders were still employees at the University of Stanford, where they graduated. It’s where Cisco created the router. It was a duplicate of Stanford's "Blue Box" router, running an unlicensed copy of the university's multiple-protocol router program, which was adapted into the foundation of Cisco internetworking operating system. However, Stanford eventually agreed to license its router software and two computer boards to Cisco in 1987 (Cisco, 2017). Drivers for Cisco Innovation

(Kuala-Lumpur, 2019) Shown in the image above are the various variables both inspire and motivate a company to innovate. Any of these drivers necessitates consistency and learning. These drivers instil a sense of urgency in implementing new company strategies and the generation of new ideas for achieving these goals.

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In need of funds for expansion, the founders approached Sequoia Capital, a venture capital company, one of Silicon Valley's most established and most prominent venture capital companies. After listening to Bosack and Lerner pitch, the partners of Sequoia heard not a company needing capital but a raw start-up needing everything, everything that is other than an intriguing jump on a product idea they had identified in their partners’ meetings as compelling (Pelkey, 2007). Cisco eventually received an offer investment of $2.5 million in exchange for 32% of the company. The founders were satisfied with the offer as Sequoia would have little involvement in its operations; their only aim and responsibility was financing. The Innovation / Open Innovation Cisco distinguishes innovation across four main categories. Product & Technologies involves creating completely new goods or services, often focused on the most recent technological advancements. Cisco focuses on actual products being significantly enhanced in terms of performance, functionality, and shapes. Process Innovation: Keeping updated with the retail and technology industry transitions using real-time analytics, cisco managed to maintain doing more reliable market forecasts and real-time analysis of consumer opinion. Position: Cisco repositions the definition of their existing product/service in the customer's minds while simultaneously moving into new business segments. Business Model: This form of innovation can include many aspects of a business, ranging from reframing an existing value proposition to rethinking a company place in the value chain, cisco over time has demonstrated this over time with the consistent changes within their organisation. Cisco Management Process It is difficult for a company like Cisco Systems and its rivals to continue to evolve as they did when they first launched. Cisco has created a multifaceted and organized growth approach to ensure that the creative spirit is maintained. Cisco five-fold innovation strategy (Cisco, 2016)     

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Build: Organic innovation from our engineering teams. Buy: Acquisition of companies with a technology complementary to Cisco’s business priorities. Partner: Creating solutions and go-to-market strategy with technology and services partner. Invest: Direct and indirect investments in promising start-ups, entrepreneurs and venture funds. Co-Develop: Working with customers, leading innovators and decision makers on a new, industry – changing ideas build on the network.

(Kuala-Lumpur, 2019) In order for cisco to carry out this strategy they first had to build their IP (intellectual property) consisting of copyrights, patents, trademarks and trade secrets. Hiring over thousands of staff and engineers they’ve spent over 6.3 billion in research and development. The organization aims to cultivate an innovative community by introducing policies that promote creativity. They also do this by supporting “Alpha” projects that facilitate disruptive new technologies that drive innovation (Moorhead, 2015). Cisco has acquired over 200 firms since the company was founded. Acquisitions enable Cisco to obtain innovation and develop key talent that will help them accelerate within the market, leading to market expansion and new market entry. The top companies acquired by Cisco are Acacia communications, Duo security inc, Jasper technologies, Meraki and NDS group (Nickolas, 2020). Cisco’s Open Innovation Platform Cisco partnered with ecosystem partners. At the chain in berlin, it operates under the co-innovation action. (W. Chesbrough, 2006) said open innovation is a paradigm that assumes that firms can and should use external ideas as well as internal ideas, and internal and external paths to market, as the firms look to advance their technology. Cisco used this type of innovation to reduce the amount of risk that comes with innovation, the company identified advantages in embracing their risk experience.   

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Cisco knew that Sharing risk through open partnership between consumers and the Cisco system, incorporating a diverse set of skills, insights, and industry knowledge together. Implementing rapid prototyping, which allows them to quickly evaluate quality and feasibility and either gain or destroy a project at an early stage. Creating win-win partnerships from the outset and working collaboratively with shared success.

(OpenBerlin Cisco, 2016) Cisco adopted many innovation strategies to ensure that everyone within the organization shared in or felt involved in the innovation process in order to add external innovative ideas to the company. Innovate Everywhere Challenge CEO Chuck Robbins said “As an employee, your ability to innovate, disrupt and drive relentless scale and improvement is crucial, not matter where you sit in the company” (Cisco, 2016) The overall objective of this challenge was to capture and expand disruptive venture innovations from Cisco’s employees. The creation of this challenge helped to improve organizational engagement, empowerment and team cohesion in all departments within the company. The company was able to increase their entrepreneurship skill and cultural appreciation through the process of this event. Over the period of 6 months the contesters would go thought four stages. 1. Ideation 2. Investigation 3. Seed Funding 4. Implementation (Cisco, 2016)

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Cisco’s Impact & the Future of it’s Innovation Cisco present themselves as the being Technological drivers following the lead of their technical strengths and exploiting their continued commitment in R&D to accelerate both disruptive innovation and incremental change Seeking to resolve their consumers' underlying needs through technological advances. However, they also show to be Market Readers by observing their customers and their rivals, learning the real solution to what succeeds and what doesn't. Cisco's utilization of internal innovation, acquisitions, partnerships, and marketing have contributed to the company's success. The acceleration in internet usage accelerated the company's growth, and with Cisco's revolutionary products, they became the internet's backbone. Since the announcement of their IPO in 1990, shares drastically increased drastically over a 10-year period. Revenue jumped 155% to $69 million in 1990, and with earning up to 188%, 189% and 150% in the first three quarters, over the 90s revenue grew at least 32% as much as 163% each year hitting 18.9 billion in 2000 (Barlas, 2014). Cisco's advancement has an impact on its business, assisting them on their journey to create an environment of innovation within their employees throughout the company. With the success of the company’s innovation and growth, one of their greatest drivers of this cultural shift is the creation of the Innovation Hub. The Innovation Hub has become a thriving virtual community where employees can participate in innovation events and competitions, discuss new technologies, and connect with peers and mentors with similar interests (Cisco Systems, 2018). Cisco is dedicated to developing and deploying creative solutions to the world's most critical challenges. The company is a member of the Clinton Global Initiative (CGI). In order to maintain their commitment that have to impact the society they follow three factors in the process to contribute to the social change within communities worldwide. 1. Scaling and replicating proven solutions to underserved geographies, markets and populations 2. Democratising social and technological innovation to drive global and local impact 3. Making the required long-term investment to address global challenges and create opportunity for all (Mulvany, 2015)

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Conclusion & Critical Review of Cisco At the rate Cisco is continuing to adapt and enhance its innovation strategies, I believe the company will be foreseeable in the future. Through significant research, I’ve learned that Cisco doesn’t just care about creating new products to impress the market or its customers. They present time and time what they want to solve and how they’re going to do it. The company is an excellent example of how to stay consistent through the changes that companies like Cisco face within the technological industry. Cisco has shown cross-functional approaches to innovation over time. Their fivestage innovation strategy meant that R&D was clearer and more structured and incorporated with marketing, distribution, operations, and cost control. The company has had their fair share of CEO’s but each CEO was able to maintain top management commitment. The leaders were willing to take on the challenge and make the invention idea a reality by investing in frameworks that reflect and strengthen management participation, engagement, passion, and encouragement throughout the organisation Cisco displays the understanding that learning never stops. They perfect their imperfections and teach the new practices of innovation development across their organisations' functions. The main threat that could knock Cisco off their leadership ranking is the recently announced security risk that Cisco’s discovery protocol (CPD) hold. CDPwn is a set of five vulnerabilities affecting Cisco equipment ranging from network infrastructure such as switches and routers to enterprise-grade endpoint devices such as IP phones and security cameras (Armis, n.d). Threats committed again the company were:  Emotet, a trojan involved in malware distribution  VPNFIlter, a modular IoT threat  Unauthorised mobile device management  Cryptomining  Olympic destroyer, an example of destructive cyberattack campaigns (Burton, n.d) Hackers are evolving Cisco continue to develop their security to the best of their ability, however the company stated they understood the innovation been the attacks as it will only evolve further.

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Armis. (n.d.). CDPwn: 5 Zero-Day Vulnerability in the Cisco Discovery Protocol. [online] Availability at: https://www.armis.com/cdpwn/ [Accessed 30 Mar 2021]. Barlas, P. (2014). Cisco Systems Took A 118,741% Ride On The Internet. Investor’s Business Daily. Available at: https://www.investors.com/news/technology/cisco-innovation-and-acquisitionstrategy-fueled-stock/ [Accessed 29 Mar 2021]. Burton, H. (2019). Cisco’s 2019 Threat Report: What are the biggest threats to plan for? [online] Gblogs.cisco.com. Available at: https://gblogs.cisco.com/uki/ciscos-2019-threat-report-what-are-the-5-biggestthreats-to-plan-for/ [Accessed 30 Mar 2021]. Cisco (2016). Cisco Ignites Companywide Start-up Culture Unique Innovate Everywhere Challenge Unleashes Passion and Renewed Commitment from Employees. [online]. Available at https://newsroom.cisco.com/documents/10157/14740/790057-WhitePaper060816-FINAL.pdf [Accessed 22 Mar 2021] Cisco (2017). 8 Things You Didn’t Know About Cisco Systems. [online] Cisco. Available at: https://www.cisco.com/c/en_dz/about/blog-africa/2017/8-thingsyou-didnt-know-about-Cisco.html [Accessed 20th Mar 2021] Cisco Systems, Inc (n,d.). Who is Cisco. [online] Cisco. Available at: https://www.cisco.com/c/en_au/about/who-is-head.html [Accessed 19 Mar 2021] Cisco Systems ed., (2018) Cisco’s Innovation Hub. [online]. Available at: https://newsroom.cisco.com/documents/10157/1781523/FINAL_Innovation_H ub_White_Paper.pdf [Accessed 29 Mar 2021]. Kuala-Lumpur, M. (2019) Cisco Connect 2019. [online] Cisco.com Available at: https://www.cisco.com/c/dam/m/en_my/events/connect-2019/pdfs/ciscoinnovations-making-the-future-possible.pdf [Accessed 21 Mar. 2021] Lewis, R. (2017). Cisco Systems | History & Facts | Britannica. In: Encyclopaedia Britannica. [online] Available at: https://www.britannica.com/topic/Cisco-Systems-Inc [Accessed 20th Mar 2021]. Moorhead, P. (2015). Demystifying Cisco’s Five Pillar Innovation strategy. [online] Forbes. Available at: https://www.forbes.com/sites/patrickmoorhead/2015/12/18/demystifyingciscos-five-pillar-innovation-strategy/?sh=3db2dc3c7983 [Accessed 28 Mar 2021]. Mulvany, K. (2015). Three Ways We Can Impact the Future of Society and the Planet. [online] Cisco Blogs. Available at https://blogs.cisco.com/csr/three-

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ways-we-can-impact-the-future-of-society-and-the-planet [Accessed 29 Mar 2021]. Nickolas, S. (2020). Top 5 Companies Owned by Cisco. [online] Investopedia. Available at: https://www.investopedia.com/articles/companyinsights/090716/top-5-companies-owned-cisco-csco.asp [Accessed 28 Mar 2021] Open Berlin Cisco (2016). An Open Innovation Platform Strategy and Objectives. [online] Cisco.com Available at: https://www.cisco.com/c/dam/assets/global/DE/innovationcenter/pdf/website_ at_a_glance.pdf [Accessed 29th Mar 2021]. Pelkey, J. (2007). Entrepreneurial Capitalism and Innovation: A History of Computer Communications 1968-1998. [online] History of Computer Communications. Available at: http://www.historyofcomputercommunications.info/Book/12/12.26_CiscoSyste ms.html [Accessed 22nd Mar 2021] W Chesbrough, H. (2006) Open Innovation: The New Imperative for Creating and Profiting from Technology. Boston, Mass: Harvard Business School Press. [Accessed 25 Mar 2021]. WSC (n.d). Top 10 Cisco Competitors In 2021 – What Competitors. [online] Whatcompetitors.com. Available at: https://whatcompetitors.com/cisco/#respond [Accessed 20th Mar 2021]...