1,000-Employee, $150 Million Expansion Puts Cisco's Passage to India in High Gear

One of the world's hottest companies, Cisco Systems (www.cisco.com) keeps pouring it on, with the latest evidence emerging in India:

Cisco has announced that it will spend US$150 million in adding a 1,000-employee operation in Bangalore.

Bangalore is already home to Cisco's largest non-U.S. global development center. The announced expansion, however, marks a major increase in the company's commitment to capturing an Indian market verging on a huge boom in Cisco's snowballing sector.

The Bangalore expansion will triple Cisco's current Indian work force; and it will double the $75 million Cisco has expended since entering the Indian market in 1995.

India a Key Cisco Market

Even before the project was announced, though, India has established itself as a key Cisco market. For the fiscal year ending July 2000, the world's second most populous nation accounted for 10 percent of Cisco's revenues.

India now ranks as Cisco's second fastest-growing market in the world, and it figures heavily in the company's long-term strategy, explained Gary Jackson, Cisco Systems vice president of Asian operations.

"We are seeing phenomenal growth in the Internet and telecommunications markets in India, and there is tremendous potential for the country to establish itself as a leader in the Internet economy," Jackson said. "Our investments in the country are a symbol of our commitment to do what we can to help the country achieve that through next-generation infrastructure equipment and transfers of skills and knowledge."

Added Jayshree Ullal, vice president and general manager of Cisco's Enterprise Line, "The Cisco Global Development Center in Bangalore is a significant investment for us and is our largest R&D facility outside the U.S. This center will play a strategic role in Cisco's ability to rapidly develop technologies and scale our engineering processes in order to quickly deploy the solutions and products that customers are demanding in the Internet economy."

A Typically Slam-Bang Scenario

The Bangalore project was announced in a fashion that typifies Cisco's current rapid growth. It seems the San Jose, Calif.-based company is barely finished with one expansion project these days before it's time to start another.

For a time, in fact, Cisco's headquarters operation was expanding so rapidly that it was dubbed "the building of the month club." Currently, Cisco is adding some 1,000 employees in its worldwide operations every month. (For more on Cisco's expansion and workplace strategies, see the upcoming November Site Selection cover story.)

The new Bangalore project continued that slam-bang clip. Cisco officials announced the expansion while they were simultaneously opening 60,000 sq. ft. (5,400 sq. m.) of space recently leased to facilitate an expansion of the company's Bangalore R&D operations. And Cisco officials announced at the ceremony formally opening those 60,000 sq. ft. that the company had already leased an additional 175,000 sq. ft. (15,750 sq. m.) at another location in Bangalore to accommodate yet more expansion.

Cisco's rapid expansion of its Indian presence comes as the nation's government is steadily moving toward liberalization of the telecom and Internet sectors.

"With more players in DLD telephony, India will witness a quantum jump in telecom infrastructure leading to enhanced economic growth," noted Manoj Chugh, Cisco president of India and the SAARC Region. "Indian companies will now benefit from Cisco's dynamic convergence technologies just as our international customers."

Cisco's Indian Roots

Cisco's rapid expansion in India also marks a return to roots of sorts. Cisco officials say that employees of Indian origin make up about 25 percent of the company's U.S.-based technical personnel.

Recognizing India's wealth of software talent, Cisco will add a complete chip-design center as part of its Bangalore center expansion. Until now, center employees have only performed verification and qualification functions. Chip design will begin in some six months, company officials say.

"The reason we are not doing it right away is because of the engineering logistics involved with the other design centers in San Jose and Israel," said T.S. Srinivasan, general manager of Cisco's Bangalore R&D center. "There is no question that the design talent is here." Ullal echoed the same theme. She called Cisco's Cisco Global Development Center in Bangalore an example of "Indian brains coming back home."