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Implementing Strategy in Companies That Compete Across Industries and Countries

Implementing Strategy in Companies That Compete Across Industries and Countries

CLOSING CASE
cisco systems develops a collaborative approch to organizing Cisco Systems, famous for developing the routers and switches in which the Internet is built, is faced with reexamining its organizing approach in order to improve how its teams and divisions work together. Despite still making billions in revenues, John Chambers, CEO, recognized that his mechanistic approach would not be enough to overcome Cisco’s shrinking market value. Thus, implementing a “collaborative approach,” and organic culture that would allow everyone to be involved in decision making was thought to be the answer. Chambers created cross-functional teams, identified measurable goals both short and long term, and emphasized speedy product development. Cisco and Chambers are confident that the organizational approach will make them a global leader in both communications technology and Internet-linked IT hardware and help them bring innovation to the market more quickly than the competition.

Teaching Note:
This case illustrates the need for more organic organizational structures to improve performance. Going from mechanistic and hierarchical to collaborative and organic has improved relationships and decision making at Cisco. You may want to ask students how Cisco should use its IT to improve a shrinking market demand

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for its products. Will this organic approach be enough to sustain and keep Cisco competitive?

ANSWERS TO CASE DISCUSSION QUESTIONS
.How has Cisco changed its structure and control systems?
Cisco moved from a mechanistic control to and organic structure which allowed for more collaboration and involvement in decision making. Essentially, controls were more loose with teams and divisions, both, planning long-term strategies, developing new products, and sharing technology. Instead of a select group of managers controls the direction of the organization, now, they were all accountable for the goals they established and met. .Relate Cisco’s changes to its control and evaluation systems to the stages of growth in Greiner’s model. According to the case information, Cisco skipped through stages 1-4 of Greiner’s model to stage 5 collaboration. The case only indicates that command and control was used and doesn’t imply that there was room for creativity, direction, delegation, or coordination/monitoring. Stage 6 is yet to be determined. 3. Use the Internet to investigate how Cisco’s new approach has worked. How is the company continuing to change its structure and control systems to solve its ongoing problems?

While student answers will vary, Cisco does not appear to have reached out to very many new innovations but rather extending product development from their routers. However, a good part of their revenue comes from collaboration. It appears that Cisco continues with its collaborative approach.

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