BALACED SCORE CARD

ASSIGNMENT
Instances of Emergent Strategy

PREPARED BY:
SARAH KAZMI (FH15004)
AYUSH SINGH (H15136)
DEBJIT BOSE (H15139)
HENA MATHEW (H15145)
Ciscos Five Pillar Innovation Strategy
Cisco is a multinational technology company headquartered in San Hose California. Cisco is the
market leader in the networking industry, with a revenue of $49b. Given the massive size of the
company, it has become increasingly difficult to innovate. The company has taken an Emergent
Strategy approach to focus on technologies such as Telepresence and IoE that are up and coming.
WebEx or Telepresence is an example of a strategy that emerged from the resource allocation
process. While WebEx is for B2C as well as B2B clients, Telepresence is only for B2B clients. A
strong Cisco presence was already present with the many clients as Cisco was a networks
solutions provider. This market penetration was leveraged to launch the new conferencing
solution to improve effectiveness of communication at the workplace.
Cisco has a Five Pillar Innovation Strategy to encompass their product or corporate strategy:
build, buy, partner, invest, and co-develop.
Build- Cisco makes a high investment in R&D, around $6.3b. Cisco also ensures that out of its
25,000 engineers, a 35% are engaged in an agile development environment. The focus on Alpha
projects that develop disruptive technologies, thus helping the company to maintain market
leadership and create new and innovative
Buy- Cisco has made some highly successful acquisitions such as WebEx, a teleconferencing
platform, and Meraki, a leading innovator in cloud based hardware. The acquisitions have
expanded Ciscos product portfolio.
Partner- Partnering with a broad spectrum of companies has generated $43b (90%) of Ciscos
revenues. Cisco partners with leading IT players to cover almost 700,000 channel resellers.
Invest- Cisco has a $2b fund for investing in companies that will utilize Cisco technologies or
facilitate demand for them.
Co-develop- Cisco has an Entrepreneurs in Residence Program or EIR which helps startups crate
disruptive technologies over a 6-month period. Cisco also has 9 Innovation Centres for Internet
of Everything in tech hubs like London, Rio De Janeiro, Korea, Barcelona, Sydney, Tokyo and
Toronto. Innovation Digital Enterprise Alliance (IDEA) in the national IoE incubator in London
and it has 16 to 18 startups on-site at any given time
T.C.S risk diversification strategies
All IT companies who work in the outsourcing model take advantage from the low cost labor
availability in India. However, T.C.S provides a tagline of Experience Certainty. It merely
boils down to two strategies: Cost efficiency and Service Efficiency. However unlike Infosys
which created a high cutoff criterion to bid for projects of only high end nature, T.C.S has taken a
multi-pronged approach. It realized that it has to continue to exploit the arbitrage opportunity of
favorable exchange rate and low labor cost, but at the same time invest heavily on future
technologies and diversify its operations globally. Some of the key strategies that emerged as a
response to day to day issues like tough visa regulations, increased automation in IT sector,
increasing labor costs are as follows:
Nearshoring: T.C.S set up offices in Mexico and Uruguay to cater to the need of US clients. It
allowed them to grab higher end projects, exploit the time zone opportunity and work round the
clock on developing projects. It also helped them to gain expertise in new technology
Government Projects: T.C.S earns very low margins on government projects. But, it uses this
opportunity to allocate resources and develop capabilities adequate for such projects, as a huge
number of projects are supposed to come in a foreseeable future and the company in this process
can build good relationship with the customer to garner the advantage
Moving away from consultancy to digital solutions: Most of the competitors of T.C.S has
invested heavily on consulting services. T.C.S had also begun its journey as a technology cum
consulting arm. However, as a response to the current changes, it has moved its positioning from
a consulting company to one which can provide a complete portfolio of IT and digital solutions
to its customer. For instance, it has developed an app to streamline the processes of SMEs and
integrate its disparate processes into one. Also, it has invested big time in data analytics. Through
a series of acquisitions in India and abroad it wants to expand its service portfolio to a plethora of
markets and in different technologies. In this way it is slowly moving away from being a
consulting company to a tech based digital solution provider
Diversification into oil and gas technical solution provider: With continued stagnation of
Banking Services sector, T.C.S has tactfully diversified into oil and gas sector to create a
sustained competitive advantage. It is a partner of British Petroleum providing end to end
solutions and a market leader in this space. It has used its existing capabilities along with adding
a few subject matter experts to achieve this feat.
Resources/ Capabilities supporting the strategy
TCS co-innovation network (COIN): A network that links TCS with other hotbeds of
innovation like TCS research labs, startups, venture funds, global academic institutions,
multi-lateral organizations and other strategic alliances
TCS domain academy: A collection of Subject Matter experts
Heavy investment in Training and Development to build capability Data analysts, big
data and mobility solutions
Knowledge sharing platform (Knowme)
References:
https://www.tcs.com

PR Newswire US. 09/01/2016 article on TCS emerging as a leader in oil and gas professional
services

http://www.forbes.com/sites/patrickmoorhead/2015/12/18/demystifying-ciscos-five-pillar-
innovation-strategy/#4d0cc72541d9

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