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By Paula Musich  |  Posted 2003-04-29 Print this article Print

Today Cisco spends 40 percent of its R&D resources focused on service providers—rather than enterprises. "Were investing for the future. The companies that dont do that get left behind quickly," he said. A strong culture that can adapt quickly to change can better handle unpleasant surprises. After the economic downturn, "It took us only one quarter to adjust and get positioned for the upturn," he said. A new business model that leveraged new systems allowed Cisco to do that.
The company of the future is the networked virtual organization that retains work associated with its core competencies and out-tasks contextual work to trusted partners. But out-tasking is not outsourcing—it requires that the company retain strategy and control implementation. And it requires standardization of data and network systems, and the partners have to be ready to embrace it, he said. Cisco, which has out-tasked most of its manufacturing, ships almost 95 percent of its products to customers without Cisco employees touching them, he said. And 73 percent of service and support calls are handled online by customers themselves at a much lower cost.
Other trends that Chambers sees in the networking industry is a shift from using acquisitions to enter new markets to companies doing it themselves—in conjunction with partners. In addition, the market is moving away from buying "boxes" and moving toward transparent architectures. The next major wave of innovation in the networking industry will come from moving more intelligence into the network, he said. In a demonstration of his vision, Chambers led a demonstration of new networked technologies that will bring great productivity improvements to the construction industry "by the end of the decade," he said. Chambers sees the greatest growth opportunities in the industry in 12 new markets that Cisco is aggressively pursuing—but in an integrated manner. Those include storage area networks, wireless for business and in the home with the Linksys acquisition, IP telephony and security. Latest N+I News:
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