When John Chambers became CEO in 1995, Cisco had annual revenue of $70 million. Today Cisco has grown to over $40 billion and is reported to have stockpiled that same amount in non-US offshore profits. Yes, money that can be re-invested in Canadian innovation and start-ups.
The Second reason is that Cisco understands and embraces a major shift in the internet. There are currently 2.5 billion people connected to the internet but we are now experiencing a rapid acceleration of "things" (machines, sensors, devices) connecting to the internet. The Internet of Everything, as Cisco calls it, is in the early days but has been pegged as a $14 trillion value opportunity global of which Cisco believes $560 billion is from Canada alone. These are massive figures that give rise to debate but what is clear to McRock Capital is that sensors, machines and even your car will soon be connected to the internet. Connectivity creates knowledge which gets converted into wisdom. Data Analytics is moving to a new level and will create value across every major industry in Canada from oil & gas to power and water utilities to transportation. New companies will emerge, new jobs will be created and significant wealth will be generated.
A Will And A Way
With a massive opportunity around the Internet of Everything and financial resources at his disposal, Nitin Kawale, President of Cisco Canada has both the will and the way. He is firmly behind Chambers' goal of building Cisco into the No. 1 IT company in the world and has carved his own path. Cisco Canada punches above its weight, with its home market ranking third for Cisco across the globe. As you would expect, Kawale has a 5-point plan for turning Cisco into the No. 1 IT brand in Canada and we think it deserves some attention.
Cisco Canada's 5 Point Plan:
1. Increase R&D footprint - their 2011 effort is a little stale but we have big expectations;
2. University Chairs - Cisco understand Canada's core competencies in areas like mining and smart grid and is fueling research;
3. Cisco Innovate Centers - to help commercialize innovation;
4. Canadian Venture Capital Fund investments - Cisco will invest in experienced VC managers who will in-turn finance and help build great Canadian technology companies and,
5. Smart connected communities - offering the ability to participate in the global economy.
When executed, Kawale's plan will accelerate Canadian innovation and productivity which is needed to sustain or improve our standard of living in this country. Cisco has the technology, resources and the desire to invest heavily in Canada's future. Go Cisco.
Author: Scott MacDonald