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Cisco: Company Analysis Case Study

External recruitment

Cisco was established in 1984 with the mission of becoming the supplier of choice and attaining a high market share coupled with developing a high level of customer satisfaction and profitability. The core purpose for its establishment was to influence the outlook of global networking positively by creating exceptional opportunities and value for its partners, customers, investors, and employees.

Moreover, venturing into the global networking industry would provide Cisco with an opportunity to enhance interaction amongst businesses hence attaining global domination.

In a bid to succeed in the global networking industry, Cisco appreciates the importance of developing a strong workforce. Consequently, the firm has integrated an effective employee recruitment policy.

Upon its inception, Cisco was facing unprecedented growth both in its local and international market. One of the main reasons for the firm’s growth during its formative years relate to adoption of growth and acquisition strategy. In order to satisfy the human resource needs for the expanding firm, Cisco adopted external recruitment strategy.

Secondly, decision to adopt external recruitment was also motivated by the need stimulate employee and organisational growth. External outsourcing hinged on the firm’s quest to meet its fast-growth needs as guided by the principle of outsourcing the best employees from the market in order to become the market leader. By undertaking external recruitment, Cisco was able to pool talent from the external labour market hence increasing its competitiveness.

External recruitment provided the firm with an opportunity to outsource candidates with the necessary experience and skills. In an effort to be competitive, Cisco appreciated the need to be more innovative. The firm was of the opinion that external recruitment would culminate in stimulation of a high level of innovation.

The reason is that external employees would question how the firm operates hence creation of a forward-thinking culture amongst the employees. In line with its commitment for high employee growth, Cisco has incorporated the concept of executive coaching. Decision to implement executive coaching was motivated by the need to accelerate development of a strong executive team.

In its executive coaching, the firm outsources external coaches who collaborate with its managers to undertake executive training. This aspect has played a significant role in developing peer coaching within the firm. Outsourcing the firm has significantly enabled the firm to identify gaps hence improving its competitive strength.

Recruitment and retention tactics of Cisco

Considering the competitive nature of the global networking industry, Cisco is committed at developing a high level of employee retention. During the 1990’s, Cisco developed sufficient competitive advantage due to the high rate of employee retention. The firm’s rate of attrition in 1999 was 6.3 per cent and did not exceed 7.3 per cent during the 1990’s, which shows that the firm has been experiencing a relatively low rate of employee turnover.

During this period, employee retention within the internet industry was as high as 30 per cent. However, the firm had managed to sustain a relatively high rate of employee retention. Most employees from the firm that Cisco had acquired were in the firm. Approximately 70 per cent of managers from acquired firms were in stills with Cisco.

One of the tactics that the firm has incorporated relates to nurturing a strong organisational culture. Cisco appreciates the importance of operating ethically by incorporating the concept of Corporate Social Responsibility (CSR) as illustrated by the fact that the firm is concerned about its workforce’s welfare.

For example, the firm provides state-of-the art day-care centre that is fitted with “nanny cams” for its employee’s children. The employees can watch over their children at the comfort of their workstation. The firm provides moral and financial support in the event of disasters such as fires.

Cisco has implemented a comprehensive employee induction policy. The policy entails assigning “buddies” to new employees who are required to provide personalised attention to the new candidates. Cisco ensures that newly hired employees are indoctrinated with the company’s values, which has greatly contributed towards development of a strong organisational identification amongst the new candidate hence developing a high level of employee retention.

The concept of “buddies” has played a fundamental role in the firm’s effort to manage and lead change. The high rate of employee retention is also enhanced by implementation of an effective reward system. For example, the reward system offers stock options to employees in lower management levels. Bonuses and free dinner amounting to $5,000 also constitute a part of the firm’s reward system.

Problems experienced in Cisco with regard to organisational culture

Upon its inception, Cisco was committed at developing an organisational culture that addresses the needs of the various stakeholders such as customers and employees. Cisco’s organisational culture relied on a number of principles, which include trust, integrity, employee empowerment, and corporate social responsibility.

However, the firm has been experiencing a challenge with regard to sustaining its organisational culture. During the 1990s, the firm undertook rapid acquisition for existing and start-up firms in the global networking industry in its quest to attain its competitiveness.

However, the flipside of the rapid acquisition is that the firm’s organisational culture has been diluted. The major challenge that the firm experienced during the 1990s was how to ensure that the cultures of the acquired firm are effectively integrated in the organisation.

Failure to undertake effective cultural integration upon undertaking a merger and acquisition can adversely affect the success o the merger, which arises from the fact that employees would experience cultural crash that might culminate in resistance hence affective the firm’s long-term performance negatively.

In a bid to deal with the threat of its organisational culture being eroded, Cisco ensured that it undertook a comprehensive cultural fit analysis of the firm targeted for acquisition prior to the actual acquisition. The cultural analysis focused on people in order to determine the probability of the employees adjusting to the new environment.

Additionally, Cisco protected its culture from being eroded through continuous communication to its employees. Cisco continuously reminded its employees on its organisational values and mission thus creating a sense of direction.

In addition to the risk of cultural shock faced by Cisco, its organisational culture was also facing a challenge emanating from poor leadership. The firm had not appreciated the concept of employee development with regard to leadership.

Consequently, the firm experienced ineffective leadership development culture. Most of the organisational leaders were concerned the firm was not in a position to deal with the changes in the business environment due to lack of dynamic capabilities at Cisco.

In a bid to deal with this challenge, Cisco formulated an effective HR strategy that entailed ensuring that it leverages on its employees talent. The firm appreciated the importance of incorporating an employee development culture that would result in the firm being able to effectively deal with the challenges faced. Therefore, to achieve this goal, Cisco formulated a HR development strategy, which entailed training its workforce through Cisco University.

The HR development strategy was composed of various leadership development approaches and programs whose objective was to enhance the development of leadership skills amongst its employees. The firm’s focus on leadership development aimed at facilitating Cisco’s cross-functional alignment and productivity.

The training was required to give the employees a chance to prepare for the firm’s future success by focusing on development of the most important organisational capabilities, which include an agile and knowledgeable workface, a workforce that is appreciative of change, customer focus and foster employee productivity.

The leadership development strategy instituted by the firm during the 1990s focused at ensuring that the firm’s leaders become effective influencers who focus at stimulating attainment of customer satisfaction. Additionally, the firm has also been committed at developing a strong teamwork and collaboration with various stakeholders such as customers.

Human resource planning at Cisco

Cisco, as a global networking company, has been concerned about developing competitiveness in the industry. Thus, the firm has incorporated the concept of human resource planning. A number of HR planning aspects illustrate its commitment towards HR planning, which include talent management, developing an effective work environment, and nurturing organisational effectiveness.

Over the years it has been in operation, Cisco has consistently emphasised on the need to develop a strong human capital in addition to creating a high level of customer satisfaction. Thus, the firm has integrated talent management amongst its strategic management processes.

In its talent management efforts, Cisco is cognisant of the role of effective recruitment to the firm’s long-term survival. Consequently, it incorporated both internal and external employee recruitment strategies, which played an essential role in the firm’s quest to develop a strong labour force.

Its commitment in talent development is also evidenced by its investment in employee training. The firm undertakes employee training by incorporating both in-house and through outsourcing. The firm outsources the services of renowned institutions such as Harvard Business School to assist in employee training.

The training offered is essential in ensuring effective on boarding for its employees hence improving their productivity and the overall organisational performance. Additionally, incorporation of an employee-training program has significantly contributed towards the firm nurturing a high level of customer satisfaction.

Most employees are able to develop strong organisational identification due to the high level of job and career satisfaction developed. The training positions the firm’s employees in addressing future challenges that they might face in the course of executing their duties.

The firm’s commitment in HR planning is evidenced by the management team’s effort to ensure that an environment conducive for working is created. Consequently, the firm has integrated the concept of people management as illustrated by its compensation plan.

Cisco has instituted an optimal employee reward policy that factors in both monetary and non-monetary rewards. The policy has played a fundamental role in enhancing job satisfaction.

Alternative HR planning method that Cisco could use

Systematic forecasting of human resource needs

To improve its competitive advantage with regard to human capital, Cisco should also have considered undertaking systematic forecasting with regard to its human capital needs. In this strategy, Cisco should have considered integrating continuous evaluation of its business conditions in order to determine its future needs effectively.

Incorporating manpower planning will play an important role in anticipating HR shortages hence avoiding future personnel challenges. Consequently, Cisco will ensure timely labour surpluses and shortages. Additionally, manpower planning will also assist the firm to develop optimal HR policies such as employee recruitment and training.

Thus, manpower planning will form the basis upon which Cisco will undertake career development. Through manpower training, the firm will be in a position to improve the employees’ attitude, behaviour, and skills hence ensuring optimal utilisation of its human capital.

This aspect arises from the fact that the employees will be in a position to apply the skills, knowledge and abilities developed hence stimulating organisational success. Manpower planning will improve Cisco’s efficacy in controlling labour costs.

Performance management strategies Cisco

In line with its commitment to employee development, Cisco incorporated performance management that aimed at ensuring performance evaluation. The strategy adopted by the firm entailed each employee undertaking his or her performance evaluation. The evaluation strategy entailed filling a 6-12 page document, which was later reduced to 2 pages.

Additionally, the performance management strategy also entailed leadership review process (succession management) and talent assessment process. The leadership review process entailed aligning individual goals with the set organisational goals and initiatives.

In a bid to simplify the performance management evaluation, Cisco automated its performance management process, which made it possible for employees to adjust their evaluation on performance in line with their job enrichment.

Additionally, the strategy also entailed collecting and sharing performance feedback in order to support career development. Therefore, the performance management strategy adopted by the firm entailed a dialogue between the employee and the manager.

On the other hand, talent assessment process entailed evaluating individual employees’ performance based on predetermined elements, which include their productivity, versatility, and alignment to organisational performance.

The talent assessment strategy was inclusive in that it evaluated all the employees irrespective of their position in the organisation. The strategy entailed assessment of employee performance based on their leadership and knowledge skills.

Performance management strategy that appeared most effective

Leadership review process or succession management strategy appeared to be most effective performance management strategy. Its appropriateness emanates from the fact that it takes into account the employee life cycle. Through succession management, organisations are able to identify the employees’ development potential.

As a result, the firm can implement career development programs that align to both the employees and organisational success. Succession management strategy will also provide Cisco with an opportunity to develop an effective leadership pipeline, which will culminate in the firm meeting its organisational demands. In conclusion, one can assert that succession management enhances an organisation’s ability to have the right workforce at the right time.

Advantages of performance management over performance appraisal

Performance management is relatively strong compared to performance appraisal with regard its effectiveness in developing and nurturing relationship between the subordinates and the top management. Performance appraisals are mainly focused on assessing the top-down performance of an organisation.

On the other hand, performance management is more effective in developing relationships between the management and lower level employees by stressing on joint dialogues between the two parties.

Additionally, performance management stimulates development of a strong organisational identification by incorporating a comprehensive reward system. On the other hand, performance appraisal is concerned with monetary remuneration.

Cisco’s leadership and development program

Cisco has incorporated a comprehensive leadership and development program that aims at stimulating the firm’s productivity. Cisco is cognisant of the fact that one source of organisational productivity is a strong human capital. Over the years, Cisco has been committed towards development of strong organisational leadership and to achieve this goal, the firm has instituted an executive leadership development program.

The program aims at equipping its employees with skills and techniques necessary to deal with the changes in the business environment. Additionally, leadership development also aims at supporting the organisation achieves its goal of being the global leader with regard to the provision of networking services.

Occurrence of the 2007/2008 economic recession stimulated the firm’s commitment towards leadership and development program, which arises from the fact that the firm was adversely affected by the recession hence leading to poor performance.

In a bid to stimulate its growth, the firm invested in leadership and development in order to create a strong team. The firm’s leadership development program also aims at nurturing a strong organisational team that can enhance attainment of the firm’s goals.

One of the strategies that the firm has incorporated in leadership development is executive coaching. The coaching is undertaken through collaboration of internal and external stakeholders. Executive coaching provides an opportunity for Cisco to identify gaps hence adjusting its leadership development program.

Various strategies which include online learning, on-the-job training, job enrichment, job rotation, and assignment of challenging tasks are some of the strategies that Cisco has incorporated in its quest to encourage leadership development.

Training and development design and delivery program

In a bid to develop and sustain its competitiveness, it is fundamental for Cisco to incorporate effective employee training and development. The training will provide the software engineers with an opportunity to develop software products that address the prevailing market needs. In its training and development program, Cisco should ensure that clear training and development goals are formulated.

The training goals will prevent deviations that might occur in the training process. Secondly, setting the goals will ensure that the software engineers have a comprehensive understanding of the training objectives. The training goals should be effectively communicated to the engineers.

The training and development design should also incorporate the various design factors. Some of the factors that Cisco should take into account include the content of the design, design needs, the participants, and resource requirements. The content of the training program should include the necessary expertise for the training and the number of participants.

On the other hand, resource requirements should include both tangible and intangible resources such as time, cost, number of instructors needed, and the equipment, technology and software requirements. A comprehensive evaluation criterion to determine the success or failure of the training program should be incorporated.

With regard to delivery, a comprehensive design should be prepared. The design should outline the content, the tasks to be undertaken, and the necessary materials. After completion of the design, it is important for the firm to ensure that the involved stakeholders are in agreement with the proposed design.

Consequently, it is vital for the stakeholders to be involved in a discussion in order to explore and identify areas whereby possible adjustments can be undertaken.

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