Having just completed a stint at a young, fast-growing networking company as SVP of Worldwide Sales, the challenge of competing with and trying to beat Cisco is fresh in my mind. Given their market dominance and strong brand, this is easier said than done. But Cisco is changing, and their pursuit of growth outside their traditional networking markets has made them more vulnerable to competitors whose focus remains primarily on the network.
John Chambers, Cisco’s CEO, recently spoke about the company’s focus on “adjacencies,” the idea of adding technologies that are adjacent, or incremental to, their existing offerings. Added primarily through acquisition, the objective is to expand Cisco’s addressable market and, in doing so, find a way to maintain their high growth. Cisco has openly discussed their desire to expand these adjacencies from their current number of approximately 30, to 50 or more. So, these days Cisco is not just a networking company - they’re a video-conferencing, set-top box, flip-video and server company too!
This may be a smart strategy for Cisco, but it’s also good news for Cisco networking competitors. If you think of these “adjacencies” as priorities, then it’s obvious that 30 or 50 are too many. When I’m fighting for business and I know that I’m competing with someone who has 30 or more priorities while I have only one or two, I like my chances. In fact, you could argue that if someone has 30 or more priorities, then in reality they have none, because it’s impossible to truly focus on so many things and consider them all “priorities.” Smart competitors will exploit this lack of focus.
Cisco is doing what is necessary to continue to drive growth. Their dominant market share in the traditional networking space limits their opportunities for growth in that arena. As they widen their product portfolio, they also expand their focus, creating opportunities for more single-minded competitors to exploit. Good news for Cisco’s networking competitors and start-ups everywhere!