How Cisco IT Improved Strategic Vendor Management

With more than 35,000 employees and hundreds of locations, each Cisco office has many complex IT requirements. Cisco uses its own products and services wherever possible, but still spends US$500M a year globally on other IT products and services. These out tasked products and services used to come from local suppliers, resulting in a number of issues, including lack of formal contracts, support time problems, and disagreements over prices and warranties. In response, Cisco created a new global IT group called the Cisco Vendor Management Organization (VMO) in May of 2002. Its mandate includes managing strategic vendors that supply hardware infrastructure, software, storage, telecom services, and outsourced services. In addition, the VMO provides value and expertise in process and business development, asset management, and vendor engagement.