A SWOT analysis gives a sum-up of the strengths and failings of the company together with the chances and menaces it faces. It draws the critical strengths, failings, chances and menaces from the strategic audit and distils this information to demo the critical points from the internal and external audit. The figure of points is little for forceful communications, and they show where a concern should concentrate its attending ( Kotler et al. 1999: 94 ) .

On the whole, a formal SWOT analysis non merely increases the consciousness of the alone state of affairs the house is in ( both in footings of indicating out what needs to be done and in seting jobs into position ) , but besides provides a roadmap to keep, construct and leverage the strengths every bit good as deter or extinguish failings so as to prosecute, exploit and capitalise on the chances even while avoiding, countering or at least supporting against potentially lay waste toing menaces.In the words of a top adviser: `` It gives a comprehensive construct of internal and external factors and how to creatively and innovatively develop a scheme that is directional, cost-efficient and of class feasible '' ( Excelsia Blog 2009 ) .

SWOT Analysis of Cisco

Strengths

Market leadersDedicated Management TeamStrong trade name equityStrong fiscal clasp

Failings

Fluctuating planetary bordersHigh pricingLow Gross saless Ability

Opportunities

InventionMerchandise and services enlargement

Menaces

Economic lagMonetary value warsMerchandise permutationIBMDell

A

Cisco Strengths

Financially, Cisco is debt-free and has approximately $ 21 billion hard currency in the bank ( Omnivorous 2003 ) . It generated around $ 3.2 billion in hard currency flow from operations entirely for the 2nd one-fourth of financial 2009, compared with $ 2.

4 billion for the 2nd one-fourth of financial 2008, and compared with $ 2.7 billion for the first one-fourth of financial 2009 ( Cisco 2009 ) . The immense turnover non merely aided them to fund the critical countries such as R & A ; D or selling, but besides gave them the strength to get engineering with lower venture capital support in the market. It besides enabled the company to purchase back $ 2 billion in common stock during FYQ1 ( Omnivorous 2003 ) .

An extra property of Cisco 's strength is their fiscal direction. Cisco 's cardinal balance sheet figures province:DSO ( Distinguished Service Order ) is 25 yearssInventory bends were 7.3 in Q1, up from 6.8 in Q4FY2003 ( Omnivorous 2003 ) .Grosss per employee were $ 525,000, more than 46 % higher than Juniper Networks and about double than Nortel Networks, harmonizing to Joel Fishbein of Janney Montgomery Scott ( Add mentions ) .

Gross borders are highly high, at 68.7 % ( Omnivorous 2003 ) .Cisco 's fiscal strength has complemented its long term vision and scheme since they moved into new market contiguities in concurrence with prioritising the bing chances ( Chambers 2009 ) . Thus Cisco has been working on the simple rule of geting new companies and utilizing their bing values to successfully incorporate them.Furthermore, Cisco Management is well-respected for its ability to respond to adverse concern conditions, peculiarly the dot.

com explosion that started in 2001. Stephen Kamman, of CIBC World Markets writes in his Sept. 26, 2003 Cisco Systems analysis: `` Looking back at Cisco 's handling of the past 3 old ages of industry-wide catastrophe, it seems reasonably clear that Management has a house clasp over the kineticss of Cisco 's organisation and operating construction. While Cisco took an initial hit along with everyone else, it responded and refocused much faster and more efficaciously '' ( Add matching ref ) .

The gross revenues direction of the company is extremely respected. They are used to working with aggressive marks in head, good international coverage and engagement in all cardinal sections -- from international service suppliers ( ISPs ) to authorities instruction and Fortune 1000 distributers ( Omnivorous 2003 ) . The one piece losing in their long list of accomplishments was a strong merchandise offering for little concerns and place, which was filled in by the Linksys acquisition. The Cisco Management besides has strong ability to pull off channel partnerships, including IBM ( storage country webs ) , Verizon Communications, Telstra, Sony Electronics and others.Sing the work environment, Cisco was late nominated to the National Association for Female Executives ' ( NAFE ) list of `` Top 50 companies for Executive Women '' ( Cisco 2010 ) .

The list recognizes organisations whose policies and patterns encourage adult females 's promotion and whose Numberss at the highest degrees of leading, demonstrate that committedness. In the article that accompanied the list, NAFE highlighted their Inclusion Advocacy Program ( IAP ) , which paired high-voltage employees with senior executives from other concern units, who non merely mentor the person, but besides become an advocator for that individual 's professional development ( Cisco 2010 ) . Cisco is highly proud and feels privileged to be recognized on this list.

Cisco Failings

As is frequently the instance, some strength 's are besides possible failings. Cisco 's high gross borders are non believed to be sustainable, even by direction. With the acquisition of Linksys, mean gross borders declined by 1 % because consumer merchandises typically have gross borders in the 30-40 % scope ( Omnivorous 2003 ) .

Analysts feared Dell 's entry into the concern, utilizing low-priced off-the-rack constituents ( Omnivorous 2003 ) to cut down into Cisco 's concern.The pricing scheme of Cisco has come under examination as some of the merchandises are extremely priced in the market. The clients of Cisco have expressed their perceptual experience of the pricing of the single merchandises every bit overpriced as compared to Cisco 's rivals.The company has besides done some perpendicular integrating, including buying chip-maker Seagull Semiconductor in 2000 ( Omnivorous 2003 ) , but with this another job arises which is, it has become extremely reliant on outside sellers who may be capacity-limited during periods of high demand.

Cisco Opportunities

The company is positioned good overall, as IP-based webs that form the anchor of the Internet expand and drive productiveness. Howard Charney, in a presentation to Korean clients of Cisco, notes that U.

S. non-farm productiveness has been turning at an mean rate of 3 % per twelvemonth since 1995 ( when the Internet and browsers became widely used ) -- more than double the 1.4 % of the old 20 old ages ( Add mentions ) . Cisco has abundant inputs in regard to this germinating market and can play an of import portion in this concern sector.

Specifically, this is opening up the undermentioned types of chances, harmonizing to market research: Storage Area Networks: 16 % CAGR ( Compounded Average Growth Rate ) Voice-over-IP ( VOIP ) : 44 % CAGR Security: 20 % CAGR Wireless LAN: 18 % ( Omnivorous 2003 ) .The company has been seeking to place 12 advanced engineerings that could bring forth $ 1 billion per twelvemonth if markets develop up to the outlooks. Harmonizing to John Chambers, CEO Cisco, six have been identified and are in the Advanced Technology gross group ( IP telephone, place networking, optical networking, security, storage networking, and radio ) ( Add mentions ) . The staying six are yet to be identified.Finally, the addition in networking velocity has offered the company significant growing.

The common criterion today is 100Mbps Ethernet ( frequently referred to as 10/100 Ethernet because of its support for the older, slower 10Mbps velocity ) . Christin Armacost, of SG Cowen, believes that growing in that market will fuel Cisco growing, as it 's merely approximately 10 % of the market -- and has an mean sale monetary value of $ 356 vs. $ 61 for 10/100 Ethernet ( Add mentions ) .

Cisco Threats

The Form 10-K ( A comprehensive drumhead study of a company 's public presentation that must be submitted yearly to the Securities and Exchange Commission ( Answers.

com n.d. ) ) is a good topographic point to turn for the company 's ain analysis of menaces. However, the company 's top three hazards mentioned in the signifier are:1. Uncertain planetary economic system2. Variability of grosss3.

Product gross borders may non be sustainable ( Omnivorous 2003 )Extra menace factors mentioned by analysts and direction include the followers:An confederation of Microsoft ( as package provider ) and low-priced hardware sellers ( Dell, Gateway or offshore Personal computer providers ) may eat into the market portion of Cisco ( Omnivorous 2003 ) . There is besides a possibility that Juniper Networks, which outsources all of its fabrication ( in contrast to Cisco ) , is able to construct a lower-cost operating theoretical account, peculiarly in the high-velocity web sphere. Besides, possible acquisition of Juniper by a major strategic spouse, such as IBM is a hinderance to its scheme of planetary enlargement ( Omnivorous 2003 ) . Recently there are plentifulness of low cost hardware entries in the Wireless LAN market every bit good, that contribute to important eroding of Linksys 's net income borders.Asiatic markets contain tremendous potency but due to inadequate rational belongings protection, Cisco is unable to put to a great extent in these markets. Regulatory and logistical issues have prevented the outgrowth and constitution of new market countries such as voice over IP.

Mentions ( By Archak ) :

Kotler, P. , Armstrong, G. , Saunders, J. , and Wang, V. ( 1999 ) Principles of Marketing.

Second European edn. Europe: Prentice Hall Inc, 94-95Excelsia Blog ( 13 March 2010 ) Leverage success with SWOT analysis. [ on-line ] available from & lt ; hypertext transfer protocol: //www.excelsia.ch/htmlgb/blog/index.php & gt ; [ 15 March 2010 ]Wikiswot ( 15 March 2010 ) Cisco Swot Analysis [ online ] available from & lt ; hypertext transfer protocol: //www.wikiswot.com/SWOT/4_User_Generated/Cisco.html & gt ; [ 08 March 2010 ]Cisco ( 11 Jan 2010 ) Cisco Reports Second Quarter Earnings [ online ] available from & lt ; hypertext transfer protocol: //newsroom.cisco.com/dlls/2009/fin_020409.html & gt ; [ 17 March 2010 ]Example essays ( 13 March 2010 ) Cisco Systems Inc SWOT Analysis [ online ] available from & lt ; hypertext transfer protocol: //www.exampleessays.com/viewpaper/96161.html & gt ; [ 17 March 2010 ]omnivorous-ga ( 08 December 2008 ) Strategic paper - Cisco [ online ] available from & lt ; hypertext transfer protocol: //answers.google.com/answers/threadview/id/282626.html & gt ; [ 09 March 2010 ]Cisco ( 15 March 2010 ) The Platform Opinions and Insights From Cisco [ online ] available from & lt ; hypertext transfer protocol: //blogs.cisco.com/news/comments/cisco_nafe2010/ & gt ; [ 10 March 2010 ]Answers.com ( 16 March 2010 ) Mention replies [ on-line ] available from & lt ; hypertext transfer protocol: //www.answers.com/topic/form-10-k & gt ; [ 16 March 2010 ]