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Cisco finds India soothing in tough times

By Apurva Venkat
August 19, 2016 07:38 IST
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Cisco has around 11,000 employees in India, a majority of whom are into core research and development

India continues to show steady growth for Cisco, the multinational networking equipment maker. The US-based entity has already said it would cut 5,500 global jobs this year.

In the quarter ended July, its India business grew 20 per cent, whereas emerging markets declined six per cent overall and China dipped 12 per cent. This is nine straight quarters of growth for it in India, where the government and the corporate sector are seen embarking on a big digitisation drive.

Which is why sector experts feel the job cuts it has announced might have only minimal impact in India. For, they add, increasing cost pressure would also make it send more work here; this country houses its 'Globalisation Centre East'. Cisco has around 11,000 employees in India, a majority of whom are into core research and development.

Two sides of the coin
Cisco's India business grew 20 per cent but the global story is a bit different
Cisco would cut 5,500 global jobs this year
This is the second major job cut by the company in two years
6% decline in emerging markets
12% decline in China
6,000 were laid off in 2014
Its staff base in the country was 1,200 in 2007 and is now around 11,000

While announcing its financial numbers, Cisco had announced the plan to reduce employee count by 5,500 this year, around seven per cent of global staff strength. This is the second major job cut by the company in two years; in 2014, it had laid off 6,000 employees.

Information technology (IT) news portal CRN had on Wednesday said the decision was predominantly driven by Cisco being in the process of transforming itself with its root in hardware to a software-centric organisation.

Cisco has said the job cuts are a response to the changes big businesses are making in how they operate and to shift IT from clunky hardware to online cloud computing.

“Today’s market requires Cisco and our customers to be decisive, move with greater speed and drive more innovation than we’ve seen in our history,” the management was quoted in a Guardian report.

“Today, we announced a restructuring enabling us to optimise our cost base in lower growth areas of our portfolio and further invest in key priority areas such as security, IoT (internet of things), collaboration, next generation data centre and cloud.”

Despite there being various staff retrenchments in the company for the past four years, none of these had any serious impact in India. Its staff base in the country was 1,200 in 2007 and is now around 11,000.

India is also a growing market for Cisco. In the past eight quarters, it has shown steady growth here, while in terms of market share, it leads in seven of the eight segments it operates.

Photograph: Albert Gea/Reuters

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Apurva Venkat in Bengaluru
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