Cisco Systems Inc Case


Executive Summary


This report generates the factors for ERP implementation in Cisco on both success and failure aspects. Some of these factors are, as described in the general theory, the basic principles or steps that needed to be followed in implementing all ERPs; some of them are the lucky elements that are only experienced by Cisco, Inc. Even though Cisco’s ERP implementation was a success, there are also numbers of failure factors, or can be called difficulties, which could be encountered by other organizations when they implement ERP. These factors are vital. The lessons learned from Cisco and the factors that are found in the process will benefit the on coming implementations on which the top management will make careful decisions.


The other point the writer makes here is that the factors which made the ERP implementation success in Cisco and the success of the Cisco implementing are not the only factors that can make business success. The wholly success of Cisco is base on the aim and its strategy which are achieving its goals through setting industry wide standards; customer orientated; making systematic acquisitions; forming strategic alliances with the right partners and its ultimate emphasis, ensure its customer’s success by helping them achieve productivity and improve profitability via end-to-end network solutions.


Cisco the Company Background


Cisco Systems is one the most important successful cases on an ERP implement with the internet and since then it has added substantial CRM capabilities for customer service and an extensive portal for internal and customer-oriented knowledge management. Even with its lead, the company never rests: It recently went through another round of reengineering key processes to make better use of available technology.


Cisco System, Inc. was founded in 1984; became public in 1990, their primary product is the “router” hardware & software that control Intranet & Internet traffic. The rise of the Internet made Cisco one of the top companies, a company that has been growing by acquisitions. With the rise of Internet technologies demand for Cisco’s products boomed and the company started to domain the market. In 1997 Cisco ranked among the top five companies in return on revenues and return on assets, 1998 just 14 years after being founded, Cisco market capitalization passed the $100 billion.[1] Until 2000 Cisco Market Capitalization was 153.67 Billion and Cisco Sales was over 20 Billion.


ERP Project Background


Initial situation:


Cisco relied on Unix-Based software package to support its operations: Financial, Manufacturing & Order Entry, the system lacked reliability and the ability to expand. At that point, the CIO knew that they needed a change however; he wanted to avoid an ERP project.
The first approach used was that each functional area would determine when and how it would be upgraded. This approach did not help, little progress was made, up to the point that the systems had put Cisco out of operation for over two days. This was the point where Cisco realized that a simply “Band-Aiding” the system was not going to work; an ERP project was the only way.


When it was time to go to the board key questions had to be answer such as cost and time. The board adopted the decision with a committed of 9 months of implementation and a total cost of $15 million.


Cisco’s process:



o An Investigation team was put together
o Regardless of what they did, it had to be quick (Big-Bang) and as simple as possible (Standardization)
o Selecting an ERP Product
o Internal Involvement

o Requires people from all areas of the business community
o External Involvement

o Strong partnership to help the selection and implementation
o KPMG became their key partner, because they were most experienced in the industry
o Selecting an ERP Product

o Information search
o Build on the experiences of others.
o Four stages: CRP 0-3 (Conference Room Pilots)
o Decision speed was the key due to its emergency.
o Promises: long term development based on the functionality of the package, this was a key factor for Cisco’s success. The promise was not only on a product in was on the capability of this product.

o Flexibility since Oracle was close to them
By reviewing the process of Cisco’s implementation one can then dig into the details what factors that made it