Cisco Systems implementing ERP
Cisco Systems, Inc.: Implementing ERP
Introduction
Cisco Systems Inc. was founded in 1984 by two of Stanford University’s computer scientists. In 1990, a matter of just six years from the start-up date, Cisco became publically traded. With the massive growth of Internet Technologies, demand for Cisco products increased dramatically, resulting in Cisco dominating the marketplace. The contributing factor to Cisco’s dominating presence in the market is due to the company’s primary product, the “router”. This is a combination of hardware and software that acts as a traffic cop on the complex Transmission Control Protocol and Internet Protocol (TCP/IP) networks that make up the internet as well as corporate intranets. TCP and IP networks provided a robust standard for routing messages between LANs and created the potential to connect all computers on an ever-larger Wide Area Network (WAN).
Financially, the company experienced consistent growth from July 30, 1995 up until July 25 1998. Using figures provided in Exhibit 1 of the case study, it can be calculated that Net Sales increased a whopping 279% from 1995-1998. The year 1997 proved to be a milestone for the company. It was the first year for the company to feature on the Fortune 500 list. Cisco was ranked among the top five companies in return on revenues and return on assets.
Some industry pundits predicted Cisco would be third dominating company alongside Microsoft and Intel, to shape the digital revolution. The reasoning behind such a bold prediction is because just 14 years after being founded in 1998, Cisco’s market capitalization passed the $100 billion mark. Such potential did not go unnoticed. Don Valentine, partner of Sequoia Capital and vice chairman of the board of Cisco, was the first to recognize the success and potential of Cisco. He decided to take a chance on the young company, by initially investing $2.5 million. However, he ensured that with this investment he reserved the right to bring in
Introduction
Cisco Systems Inc. was founded in 1984 by two of Stanford University’s computer scientists. In 1990, a matter of just six years from the start-up date, Cisco became publically traded. With the massive growth of Internet Technologies, demand for Cisco products increased dramatically, resulting in Cisco dominating the marketplace. The contributing factor to Cisco’s dominating presence in the market is due to the company’s primary product, the “router”. This is a combination of hardware and software that acts as a traffic cop on the complex Transmission Control Protocol and Internet Protocol (TCP/IP) networks that make up the internet as well as corporate intranets. TCP and IP networks provided a robust standard for routing messages between LANs and created the potential to connect all computers on an ever-larger Wide Area Network (WAN).
Financially, the company experienced consistent growth from July 30, 1995 up until July 25 1998. Using figures provided in Exhibit 1 of the case study, it can be calculated that Net Sales increased a whopping 279% from 1995-1998. The year 1997 proved to be a milestone for the company. It was the first year for the company to feature on the Fortune 500 list. Cisco was ranked among the top five companies in return on revenues and return on assets.
Some industry pundits predicted Cisco would be third dominating company alongside Microsoft and Intel, to shape the digital revolution. The reasoning behind such a bold prediction is because just 14 years after being founded in 1998, Cisco’s market capitalization passed the $100 billion mark. Such potential did not go unnoticed. Don Valentine, partner of Sequoia Capital and vice chairman of the board of Cisco, was the first to recognize the success and potential of Cisco. He decided to take a chance on the young company, by initially investing $2.5 million. However, he ensured that with this investment he reserved the right to bring in