Cisco

Inside lake herrings $2 Billion Blunder By: capital of Minnesota Kaihla  Issue: March 2002 Print name | Email This Article    How the worlds most admired supply chain screwed up, and how chief operating officer John Chambers plans to fix it. [pic] As corporate humiliations go, it had to be one of the worst. In May 2001, Cisco Systems (CSCO) announced the largest scrutinize write-down in history: $2.2 billion erased from its balance flat solid for components it narrateed but couldnt use. The gaffe was made all the more(prenominal) embarrassing by waves of prior publicity about Ciscos brilliant integration of its vast information systems. The network was so antiphonary, gushed Cisco CEO John Chambers, that the company could close its books in 24 hours, any day of the year. Yet the system wasnt responsive enough to stop building billions of dollars worth of stuff nil wanted. Cisco blamed the fiasco on a plunk down in technology spending that Chambers called as unpredictable as a 100-year flood. If company forecasters had only been able to feel this coming, Cisco implied, the supply-chain system would have worked perfectly. But Business 2.0 has intentional that, in fact, flaws in the system contributed significantly to the breakdown.

Cisco recognized many of these problems even before last years scrutinize bubble, and ever since, an elite group of execs and engineers has been working on a top-secret remediation program called eHub. Heres the first internal look at how this ambitious, multimillion-dollar project could help avoid a repeat of last years disaster ... if it works as planned. Inflating the Bubble During the late 1990s, Cisco became famous for being the hardware manufacturing business that doesnt make hardware. Instead, Cisco farms out most of its routers and switches to electronics contract manufacturers. This scheme has several advantages. For one, it allows Cisco to concentrate on marketing and reaping innovation. It also liberates Cisco from much of the hassle and expense of maintaining inventory, as Ciscos information... If you want to get a full essay, order it on our website: Ordercustompaper.com

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