Slowdown Is Cisco's Chance to Gain Market Share: CEO
The current slowdown, which is making other CEOs think about cutting investment because of the uncertainty, is a good period for Cisco to invest in order to grow its market share, even if this approach is seen as counter-intuitive, John Chambers, Chairman and CEO at Cisco, told CNBC.
The information technology company's business is growing in some emerging markets and Cisco is taking a longer-term approach than the next few quarters to see the results of its investment, Chambers said in an interview at the Saint Petersburg International Economic Forum.
"You can actually pick up more market share gains when things are slowing or right before they're picking up than you do in normal times," he said.
"When we see things starting to slow in an area that's actually when we may invest more aggressively."
Cisco invested in Russia over three years ago and its business in the country grew by 50 percent last year and it has increased "in the high teens" so far this year, according to Chambers.
"We see the emerging economies not only as being able to grow…faster than out traditional business but we see them as an opportunity for us to begin to talk about how do you change the whole economy," he said.
Chambers pointed out that in China the government is looking at changing the healthcare system and is also seeking to make changes to the education system to create jobs in the current global slowdown.
In Russia "you can't deny how much progress they're making," he added.
While developed countries' governments did cut spending on IT around 15 months ago, continuing to reduce investment in the area is not a good strategy for these governments because the quality of their services such as healthcare, education, security of defense would drop, Chambers said.
"I would argue that governments around the world, if they don't invest in IT, aren't going to be able to work their way out of this," he said.