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Selected Case

published: 25 Mar 2010, 20 Pages
  • Research Area: Strategy
  • Industry: Telecom and networking equipment
  • Region: USA

Abstract:
The case first describes the evolution of Cisco Systems of San Jose, California, from a narrowly-focused routing and switching equipment vendor, with a highly effective competitive strategy, into a diversified networking and IT giant. This growth was fuelled by many acquisitions, the rationale of which developed over time, in light of the growth opportunities and challenges which Cisco encountered. The events described in the case took place in early 2007, while Cisco was considering the acquisition of IronPort, a security software company. A decision to purchase IronPort would symbol a continual divergence from Cisco’s old and famous acquisition strategy of acquiring young entrepreneurial firms, to complement its internal development efforts and become a one-stop-shop for its networking customers. This divergence started a few years earlier, with the acquisition of large firms like Linksys and Scientific Atlanta, labeled by Cisco’s management as “platform” deals.

Pedagogical Objectives:
This case can be taught in courses on corporate strategy, mergers and acquisitions, and general management. It contains ample data to discuss Cisco?s strategy and its contingent approach towards acquisitions. It provides insights into implementation issues involving processes and routines underlying the various phases of the acquisition process from target selection to post-merger integration. In particular, this case can be taught with a specific focus on post-acquisition integration (providing an interesting setting to apply the Haslespagh and Jemison?s integration matrix- absorption, symbiosis and preservation).

Keywords:
Mergers and Acquisitions, Corporate Development, Post-Merger Integration, Corporate Strategy, High-Tech Acquisition


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