Acquiring companies that offer attractive technologies, products, or market opportunities is a major growth strategy for Cisco. Since 1993, Cisco has acquired more than 120 companies, from small startups to large, well-established firms such as Linksys, Scientific Atlanta, and WebEx.
With multiple acquisitions occurring each year, it was essential for Cisco to develop standardized processes for integrating the newly acquired companies in each major functional area, including human resources, sales, manufacturing, customer service, finance, and IT.
“Cisco acquires only companies that will help to grow our business, so we always look at how we can protect and grow the value that we expect to attain from an acquisition,” says Graeme Wood, director of acquisition integration in the Cisco Business Development group.
Cisco has developed, and continues to evolve, a well-defined approach to integrating acquired companies. This approach involves several components, including a formal, centralized team for integration management. With each acquisition, cross-functional teams plan, manage, and monitor integration activities. These teams repeatedly apply standard principles, metrics, tools, methods, and processes to new integration efforts, adapting them to the unique issues and parameters of each deal.
To save time and ensure efficiency, the integration teams use standard collaboration tools such as Cisco MeetingPlace conference calls, WebEx online meetings, e-mail, online document sharing, and project management software. And to enhance communication, Cisco TelePresence virtual meetings facilitate discussions between remote integration team members and employees of acquired companies in distant locations.
Cisco’s standardized approach to acquisition integration has numerous business benefits, including:
- Ability to gain the value expected from each acquisition
- Faster, more efficient, and less disruptive integration efforts
- High levels of employee retention and easier cultural integration
- A significantly optimized operational infrastructure
- Standardized, repeatable, and adaptable integration processes for each department
- Continuous development of integration expertise across the company
Individual Cisco functions, such as the sales department, also realize significant benefits from using the structured integration approach. Says Pat Belotti, senior manager of sales acquisition integration in the Cisco Worldwide Sales Operations group, “The most important benefit of our standard integration processes is that we can avoid a dip in revenues. In fact, we can increase revenues quickly by applying Cisco resources to help the acquired sales team reach their full potential.”
For More Information
Cisco on Cisco
Cisco Acquisition Integration Case Study
Cisco IT Acquisition Network Integration Case Study