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Case Study: Cisco Addresses Supply Chain Risk Management

This Case Study documents a presentation made at Gartner's Security and Risk Management Summit conference in 2010 on how Cisco manages the risks associated with supply chain disruptions. Gartner assesses Cisco's supply chain resiliency program as one of the better-executed programs we have seen, and recommends other clients study it to understand how they might "derisk" their own supply chains.

CISCO’S SUCCES in SCRM

Cisco's program for SCRM combines tools, policies, practices and management support into a comprehensive system that enables the company to truly understand and manage the risks associated with the supply of most of its products.
Cisco managed to predict potential risk and points and work with members of supply chain to manage and minimize risks connected with with enviroment full of uncertainty.

THE „RESILIENCY CHALLENGE”

Cisco's business model is complicated, relying extensively on outsourced manufacturing for more than 95% of the >12,000 products it delivers, most of which are configure-to-order. Cisco sells to a broad range of customers from the private and public sector, and as Cisco expands its presence in the consumer sector (with products such as the Linksys line), it is seeing a growing presence of make-to-stock products. The company's growth strategy includes being highly acquisitive. It has made more than 140 acquisitions since its founding and is presently making three to four acquisitions per quarter.

To adress this complexity, CISCO started with two practices which allowed it to be more flexible: 1) Outsorced/ contract manufacturing model (part of businnes not related to the „core business” ) 2) Implementing lean practices through the businnes including supply chain operations.

While operating and growing its business in this environment, Cisco…...

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