Cisco Systems: Developing a Human Capital Strategy (B) SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
Organizational Development
Strategy / MBA Resources
Case Study SWOT Analysis Solution
Case Study Description of Cisco Systems: Developing a Human Capital Strategy (B)
Supplement to case B5600. Like many technology organizations in the late 1990s, Cisco was booming. It grew so quickly, in fact, that it was bringing in up to 1,000 new employees each month. Cisco's solution was to acquire talent by buying small firms, topping out in one year with 24 separate acquisitions. However, in 2000 the dot-com bubble burst and Cisco quickly realized that it had another human capital challenge on its hands: How to develop, rather than hire, the strategic thinkers and leaders needed for the future. This case study explores the challenges facing Mary Eckenrod, Cisco's Vice President of Worldwide Talent, in developing a new human capital strategy to identify and develop leaders from within the company--and to do this in a company with no tradition of developing people internally. How can Cisco move from a "buy" to a "make" human capital strategy? The lessons from this case provide a template that other organizational leaders can use in managing organizations through various stages of evolution and different types of growth. Please note: This case also has a (B) supplement available.
Authors :: Jennifer A. Chatman, Charles A. O'Reilly
Swot Analysis of "Cisco Systems: Developing a Human Capital Strategy (B)" written by Jennifer A. Chatman, Charles A. O'Reilly includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Cisco Human facing as an external strategic factors. Some of the topics covered in Cisco Systems: Developing a Human Capital Strategy (B) case study are - Strategic Management Strategies, IT, Leadership, Mergers & acquisitions and Organizational Development.
Some of the macro environment factors that can be used to understand the Cisco Systems: Developing a Human Capital Strategy (B) casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, banking and financial system is disrupted by Bitcoin and other crypto currencies, increasing household debt because of falling income levels, digital marketing is dominated by two big players Facebook and Google, competitive advantages are harder to sustain because of technology dispersion, there is backlash against globalization, increasing government debt because of Covid-19 spendings,
increasing energy prices, central banks are concerned over increasing inflation, etc
Introduction to SWOT Analysis of Cisco Systems: Developing a Human Capital Strategy (B)
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Cisco Systems: Developing a Human Capital Strategy (B) case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Cisco Human, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Cisco Human operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Cisco Systems: Developing a Human Capital Strategy (B) can be done for the following purposes –
1. Strategic planning using facts provided in Cisco Systems: Developing a Human Capital Strategy (B) case study
2. Improving business portfolio management of Cisco Human
3. Assessing feasibility of the new initiative in Organizational Development field.
4. Making a Organizational Development topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Cisco Human
Strengths Cisco Systems: Developing a Human Capital Strategy (B) | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Cisco Human in Cisco Systems: Developing a Human Capital Strategy (B) Harvard Business Review case study are -
High switching costs
– The high switching costs that Cisco Human has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Low bargaining power of suppliers
– Suppliers of Cisco Human in the sector have low bargaining power. Cisco Systems: Developing a Human Capital Strategy (B) has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Cisco Human to manage not only supply disruptions but also source products at highly competitive prices.
Digital Transformation in Organizational Development segment
- digital transformation varies from industry to industry. For Cisco Human digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Cisco Human has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Sustainable margins compare to other players in Organizational Development industry
– Cisco Systems: Developing a Human Capital Strategy (B) firm has clearly differentiated products in the market place. This has enabled Cisco Human to fetch slight price premium compare to the competitors in the Organizational Development industry. The sustainable margins have also helped Cisco Human to invest into research and development (R&D) and innovation.
Organizational Resilience of Cisco Human
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Cisco Human does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Innovation driven organization
– Cisco Human is one of the most innovative firm in sector. Manager in Cisco Systems: Developing a Human Capital Strategy (B) Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Highly skilled collaborators
– Cisco Human has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Cisco Systems: Developing a Human Capital Strategy (B) HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Operational resilience
– The operational resilience strategy in the Cisco Systems: Developing a Human Capital Strategy (B) Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
Learning organization
- Cisco Human is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Cisco Human is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Cisco Systems: Developing a Human Capital Strategy (B) Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
Ability to recruit top talent
– Cisco Human is one of the leading recruiters in the industry. Managers in the Cisco Systems: Developing a Human Capital Strategy (B) are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Cross disciplinary teams
– Horizontal connected teams at the Cisco Human are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Superior customer experience
– The customer experience strategy of Cisco Human in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Weaknesses Cisco Systems: Developing a Human Capital Strategy (B) | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Cisco Systems: Developing a Human Capital Strategy (B) are -
Increasing silos among functional specialists
– The organizational structure of Cisco Human is dominated by functional specialists. It is not different from other players in the Organizational Development segment. Cisco Human needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Cisco Human to focus more on services rather than just following the product oriented approach.
Capital Spending Reduction
– Even during the low interest decade, Cisco Human has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Cisco Human is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Cisco Systems: Developing a Human Capital Strategy (B) can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Cisco Systems: Developing a Human Capital Strategy (B), in the dynamic environment Cisco Human has struggled to respond to the nimble upstart competition. Cisco Human has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Need for greater diversity
– Cisco Human has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
No frontier risks strategy
– After analyzing the HBR case study Cisco Systems: Developing a Human Capital Strategy (B), it seems that company is thinking about the frontier risks that can impact Organizational Development strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Cisco Systems: Developing a Human Capital Strategy (B), it seems that the employees of Cisco Human don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Cisco Human supply chain. Even after few cautionary changes mentioned in the HBR case study - Cisco Systems: Developing a Human Capital Strategy (B), it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Cisco Human vulnerable to further global disruptions in South East Asia.
Skills based hiring
– The stress on hiring functional specialists at Cisco Human has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Cisco Systems: Developing a Human Capital Strategy (B) HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Cisco Human has relatively successful track record of launching new products.
Aligning sales with marketing
– It come across in the case study Cisco Systems: Developing a Human Capital Strategy (B) that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Cisco Systems: Developing a Human Capital Strategy (B) can leverage the sales team experience to cultivate customer relationships as Cisco Human is planning to shift buying processes online.
Opportunities Cisco Systems: Developing a Human Capital Strategy (B) | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Cisco Systems: Developing a Human Capital Strategy (B) are -
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Cisco Human can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Cisco Human is facing challenges because of the dominance of functional experts in the organization. Cisco Systems: Developing a Human Capital Strategy (B) case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Cisco Human to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Cisco Human to hire the very best people irrespective of their geographical location.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Cisco Human can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Cisco Systems: Developing a Human Capital Strategy (B), to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Using analytics as competitive advantage
– Cisco Human has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Cisco Systems: Developing a Human Capital Strategy (B) - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Cisco Human to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Low interest rates
– Even though inflation is raising its head in most developed economies, Cisco Human can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Creating value in data economy
– The success of analytics program of Cisco Human has opened avenues for new revenue streams for the organization in the industry. This can help Cisco Human to build a more holistic ecosystem as suggested in the Cisco Systems: Developing a Human Capital Strategy (B) case study. Cisco Human can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Buying journey improvements
– Cisco Human can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Cisco Systems: Developing a Human Capital Strategy (B) suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Cisco Human in the consumer business. Now Cisco Human can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at Cisco Human can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Organizational Development segment.
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Cisco Human can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Developing new processes and practices
– Cisco Human can develop new processes and procedures in Organizational Development industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Leveraging digital technologies
– Cisco Human can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Threats Cisco Systems: Developing a Human Capital Strategy (B) External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Cisco Systems: Developing a Human Capital Strategy (B) are -
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Cisco Human business can come under increasing regulations regarding data privacy, data security, etc.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Cisco Human in the Organizational Development sector and impact the bottomline of the organization.
Stagnating economy with rate increase
– Cisco Human can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Cisco Human in the Organizational Development industry. The Organizational Development industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Regulatory challenges
– Cisco Human needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Organizational Development industry regulations.
Easy access to finance
– Easy access to finance in Organizational Development field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Cisco Human can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing wage structure of Cisco Human
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Cisco Human.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Cisco Human can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Cisco Systems: Developing a Human Capital Strategy (B) .
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Technology acceleration in Forth Industrial Revolution
– Cisco Human has witnessed rapid integration of technology during Covid-19 in the Organizational Development industry. As one of the leading players in the industry, Cisco Human needs to keep up with the evolution of technology in the Organizational Development sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
High dependence on third party suppliers
– Cisco Human high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Cisco Human will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Consumer confidence and its impact on Cisco Human demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
Weighted SWOT Analysis of Cisco Systems: Developing a Human Capital Strategy (B) Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Cisco Systems: Developing a Human Capital Strategy (B) needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Cisco Systems: Developing a Human Capital Strategy (B) is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Cisco Systems: Developing a Human Capital Strategy (B) is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Cisco Systems: Developing a Human Capital Strategy (B) is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Cisco Human needs to make to build a sustainable competitive advantage.