TMCnet News

Cisco Moves Top Leadership to India
[February 01, 2007]

Cisco Moves Top Leadership to India


TMCnet Contributing Editor
 
Since the IT revolution began in India, companies in the developed countries have been outsourcing to India to save on costs without compromising on quality. While that trend continues without showing any signs of slowing down, India may soon witness a new trend, where not only the services, but also the top leadership of the leading companies in the world will move to India.


 
Leading this trend from the front is Wim Elfrink, the chief globalization officer at Cisco Systems (News - Alert) who has shifted base from Silicon Valley to Bangalore with his seven member team. As India and China become the new technology hotspots with their low cost work force and high number of skilled workers, companies like Cisco are concentrating more on the Eastern part of the world. Cisco’s ambitious, $50 million research and development center in Bangalore is a symbolic representation of the plans the company has for Bangalore. According to the company, by 2010, the talent pool in the Bangalore center will consist of promising executives from San Jose and Bangalore.
 
Cisco foresees a high growth potential in Asia and wants to be ready with suitable infrastructure and manpower to explore this opportunity. All of the company's primary business functions, including engineering, customer support, sales, business development, finance, IBSG, marketing and human resources will be represented both in India and the US. The company believes that India, with its educated workforce and rich culture can help Cisco to create new ways to deliver information, products and services.
 
The opinions of industry watchers are divided on this new move by Cisco. While many believe that shifting the business to Bangalore is a masterstroke, many others question this move and feel that Cisco is acting in a hurry. While it may be a significant loss to US economy, both Cisco and India stand to gain from this new move. While Cisco will gain easy access to an educated workforce at a lower cost, India will be able to create more employment opportunities and high technology. Although this move by Cisco may not threaten America’s position as a technology leader in the immediate future, if the trend picks up, US may not have to invest in new technologies.
 
Since the dotcom crash in 2000, companies looking to save costs and explore new markets are attracted to Asia. There was immense pressure from venture capitalists and investors on these companies to cut costs. While some firms outsourced part of their businesses to India, some others moved their entire operations, be it software development, data analysis, or research and development to Asia.
 
But moving the top executives of a company in US to Asia is a rarity. The reason for this is no matter where these top executives live, they command the same salary and most of the times, they earn more when they are outside the US thanks to hardship allowances and other such perks. This move from Cisco indicates the fact that the company views its operations in Asia as a strategic growth step rather than just a cost saving measure.
 
With technology giants like IBM, Oracle, Yahoo, Google (News - Alert) and others shifting to India for R&D and other important operations, India is getting ready to stake its claim as one of the important tech hotspots in the world. With its abundant workforce and low cost of living, it may just pull it off!
 
 
-----
Raju Shanbhag is a contributing editor for TMCnet. To see more of his articles, please visit his columnist page.
 
 
Don’t forget to check out TMCnet’s White Paper Library, which provides a selection of in-depth information on relevant topics affecting the IP Communications industry. The library offers whitepapers, case studies and other documents, which are free to registered users
 


[ Back To TMCnet.com's Homepage ]