Nortel says that outsourcing of non-core functions is allowing management to free up resources that can be used to strengthen the company s competitive position in optical networking and related technologies. Cisco uses acquisitions to acquire key technologies quickly. Key to the Cisco approach is issuing the company s highly inflated shares as the main payment vehicle for acquisitions. This approach can be likened to a central bank printing money to finance government programs. Not wanting to be left behind in the technology acquisition game, Nortel has adopted Cisco s acquisition-based strategy.
Speed is god and time is the devil .
Rely on the HR function Cisco relies on the human resources function as a mainstay to boost competitive position. It has always put a great deal of emphasis on having a competitive HR function, with the goal of attracting the best available talent, particularly technical. Cisco offers a wide range of programs, targeted at making the company attractive both for new recruits and permanent employees. They have also developed strategies for ensuring that the key people in its acquisition organizations are quickly and happily absorbed into the parent s hierarchy. Cisco s entire human resources initiative is underpinned by an active stock option program, which ties workforce motivation to the larger goal of making key people rich.