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The Growth and Expansion of Cisco System

Shubham Kadariya is a business student studying Computer Information Systems at Apex College, Kathmandu.

The Fortune 500 List:

The Fortune 500 is a famous ranking of businesses that are thought to make enormous sums of money globally. It is the pinnacle of achievement and establishes the company's significance in terms of worldwide dominance. If a company is included in this historical list, it is considered reputable and esteemed. Being recognized as the greatest among numerous institutions is a sign of distinction. An idea to rank the largest industrial corporations in the US was first conceived in the 1950s by an editor at Fortune magazine. Since the Fortune 500 is based on sales, it is these 500 businesses that account for the majority of the GDP each year.

Walmart has dominated the list for several years and is expected to produce revenues of more than $500 billion annually. The Fortune 500 is different from the stock market since it only ranks businesses according to their market valuation, which means that Apple and Google should lead the pack. This list includes a wide range of businesses from various industries and sectors. When a company appears on this list, interest in them increases, and more individuals are eager to invest, making it the ideal place to invest. Numerous employees and contributors are trying to give an accurate list, and in addition to the list, another magazine that reflects the analytics and offers proof is also available.

Image by: Christopher Andreola

Image by: Christopher Andreola

History of the Cisco Systems:

Cisco System Inc, widely known as Cisco, is a networking company that placed 74 on the fortune 500 list; it is estimated to be valued at over 200 billion dollars. It all started back in the December of the year 1984 when Sandy Lerner, director of the computer facilities at the prestigious Stanford Graduate School of Business, and her husband Leonard Bosack, who was in the in-charge of computer at

computer science department of Stanford University, emerged together to start a startup named the Cisco Systems. They heavily gravitated towards the Stanford Campus Technology used in the early 1980s. Students and staff used the computers linked together that enabled efficient communications with the help of a blue box named the Cisco Router. The blue box used the software developed by William Eager, widely praised by many computer critics and companies. This was the first marquee product of Cisco that labeled its success.

After experiencing astronomical growth and generating profits, they began a new project in 1985. Kirk Lougheed, a Stanford employee, and Bosack established a formal project modeled after the Stanford Network System. They modified it to incorporate Yeager's code, which serves as the basis for Cisco IOS. This progress was hindered since Stanford University were dissatisfied with their staff using their technology for their enterprises; hence they were forced to resign from their position at the university. Later, Stanford filed a lawsuit for software, hardware, and other intellectual property theft. This was a low point for Cisco, but it took some time for them to bounce back. Cisco's name was derived from the city of San Francisco. Earlier, Cisco insisted on being recognized by the lowercase 'c' in the beginning, and their logo depicts the golden bridge of San Francisco.

After reaching a low point, their first popular product was another router, which stood out since it supported several different network protocols. Due to the success of this router, they developed more projects that required funding to complete. When Sequoia Capital, an investment firm, bought them, they thought it was the best decision they had ever made. However, things quickly changed when Bill Graves, the company's current CEO, was replaced by John Morgridge. Despite having strained relationships with the company's founders, John Morgridge was a very skilled CEO who guided the business appropriately. As the industry developed, it went public in 1990 on the NASDAQ with a market cap of 224 million dollars. After in august of 1990, Sandy Lerner was fired, and soon after, her husband Bosack resigned out of anger with the decision of the boards. But they received a total of 170 million for their stocks and ownership. This was the history of Cisco, from the family venture to a global tycoon.

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Image by: Sundry Photography

Image by: Sundry Photography

Why was Cisco so successful?

They weren't the first company to develop and sell network nodes, that is true, but they were the first company to market commercial routers capable of multiple network protocols. The classic CPU architecture from their early devices also set them apart. Their instruments were advanced; as a result, the customers didn't have to buy every generation of Cisco devices. This was a win-win situation for both parties as customers saved their money, and the sellers (Cisco) didn't have to design new products and develop new products every year. This allowed them to focus on their software and evolve with the rapidly growing technology. They concentrate on providing frequent software updates that keep their devices up to date. Their most popular product Cisco 2500, would stay in production for almost a decade physically unchanged.

Image by: robas

Image by: robas

Growth and Expansion:

This was further demonstrated in the 2000s when the rise of dot com hindered most technology companies except Cisco, which became the most valued company. Their market value soared to $500 billion, but when the dot com bubble burst, Cisco Systems suffered a sharp collapse, just like every other technological business, including Dell and Oracle. The main rivals, Juniper Networks, were determined to unseat Cisco as the leading networking provider in the industry; thus, this was the ideal time for them to strike. They were successful and chipped 30 percent of the Cisco market capitalization. This ignited Cisco, and they soon retaliated by introducing faster processing cards and GSR routers. They flourished more when the market for mining Bitcoin and Ethereum expanded by developing the Ant Miner device. They made a horrible error in 2006 when they changed the company's name from Cisco System to Cisco to establish a house brand. They attempted to focus on their regular business while expanding the venture worldwide. They invested a great deal of money to open numerous offices worldwide, but there are only so many things a corporation can accomplish simultaneously and succeed at. Due to this, their rivals swiftly gained footing, including Juniper Networks at home and Huawei abroad. All these factors contributed to the Cisco company's 2011 profits being incredibly underwhelming.

When Chuck Robbins took over as CEO after John Chambers resigned, it marked a turning point for Cisco and helped to resurrect the business. He shifted the emphasis to cloud-based networking, allowing the company to escape its predicament. They sold consumer brands like Technicolor for $6 million and invested in a brand-new startup company called VeloCloud. In 2017, they would introduce their own cloud-based secure internet gateway called Cisco Umbrella, which would give users who don't connect to remote data centers using corporate networks or VPNs safe access to the internet. And these adjustments allowed their revenue to skyrocket. They just acquired Accompany, an AI-focused business that will aid them in collaborating with emerging technologies. As a result, they are now performing better than ever before.

Image by: AndreyPopov

Image by: AndreyPopov

© 2022 Shubham Kadariya

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