Cisco Bolstering its Global Strategy, Investments

From India, Elfrink leads Cisco's efforts to decentralize many of the ways the company conducts business worldwide, what he calls the "globalisation of the corporate brain."

News@Cisco recently spoke with Elfrink about Cisco's new approach to its worldwide business operations and the promise of the global economy. The following text is modified from a recent News@Cisco podcast with Elfrink.

What economic and business trends are influencing Cisco's efforts to extend the company's global activities?

Wim Elfrink: Well, first, we knew we needed to improve ways we reached other parts of the world beyond the traditional market areas such as Western Europe and Japan. India, China, and other "emerging markets" countries, ranging from Poland to Brazil, are undergoing dramatic change and modernization, especially regarding technology and their workforces. Most of these countries are growing far more quickly than traditional markets. Two hundred million people will be urbanized over the next five years and most of that will take place in emerging markets.

These markets are particularly promising because almost everything is "greenfield"-that is there is very little existing IT infrastructure. For Cisco, this means that these countries need new soup-to-nuts networks to take advantage of Internet communications and the economic and social benefits that come with them. So, having customers without existing systems to integrate is an opportunity for us to co-create new solutions.

But these countries do not just offer promising opportunities. They also provide sources of much needed talent. By investing and setting up more substantial operations in these countries-by moving closer to these areas--we feel we will be in a better position to recruit the best networking talent in the world. And the gap for talent is huge. Just in India, Cisco and other IT companies are planning to hire thousands of workers over the next few years. So competition is fierce for the best of these employees.

What are some of the tangible goals for your group, particularly at the Globalisation Centre in India?

Wim Elfrink: We are basically working off a three-year plan. Now we are in year one. Over the next three to five years we want to have 20 percent of our best talent, or about 10,000 people, here in India at our Globalisation Centre. This is not outsourcing but full company operations, with crucial management and logistical responsibilities. Some employees will come from our existing operations in California or elsewhere but a big chunk of those will be employees recruited locally.

Another important goal for our globalisation plan is to further our government relations. Many emerging countries like to work in private/public partnerships. So it is imperative that we build close relationships with these governments. Along with government relations, we also must build partnerships with businesses.

What are some of the key benefits of physically being in a location such a Bangalore rather than simply managing things from Cisco's headquarters?

Wim Elfrink: I think of two essential advantages for me or any other manager who is working globally. First, by being here you really live all of the changes taking place in these rapidly evolving markets. Your kids go to school and come home with stories. You go shopping and see what that experience is really like. This direct experience makes it that much easier to understand the country and the market, helping provide insights that can keep your company thriving and ahead of the competition. This, we feel, will help us develop new business models that will be more appropriate for these new markets.

Also, being physically closer just means it is that much easier to develop good relationships with customers. In many countries it is almost unimaginable to do business without first sitting down to dinner. So even with such communication advances like TelePresence, human contact is still crucial for starting relationships in much of the world. Having the Globalisation Centre East in Bangalore means I can reach 70 percent of the world's population within a five-hour plane ride. So that just makes it much easier to build relationships with these partners, customers, and governments.

Emerging markets are promising opportunities for Cisco, but what do the governments of these emerging markets most want from Cisco?-Cisco