1. Cisco's Supply Chain In Crisis
It started out innocently with some protracted lead times for Cisco product lines, and then mushroomed into a full-scale calamity: months-long delays for Cisco security, data center, switching and other products, a lack of communication by Cisco on the scope of the problem that frustrated and infuriated VARs and distributors, competitive wins by some of Cisco's key networking rivals taking advantage of the vendor at a weak moment and an influx of Cisco business into the gray market.
Cisco's supply chain shortfalls, which began about July 2009 and continued until they were nearly eradicated this fall, were not a problem of its own making. As Cisco's Executive Vice President Randy Pond told VARs at Cisco's Partner Summit in April, the unexpected pickup in demand for Cisco product following last year's economic slowdown caught the vendor -- and many like it -- by surprise. Coupled with a shift in economic and labor conditions in China, where many of the component factories Cisco relies on are located, and the problem was that much more magnified.