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Juniper Gears Up for Additional Growth

Revenue growth brings with it new challenges: additional expansion, more layers of management, and continuing pressure to excel. Juniper Networks, which has been doing well, recently made some changes to better position itself for the future.While many other networking vendors have struggled, Juniper has been growing at a healthy clip. The company recently beat Wall St. revenue (growing by 32% to $879 million) and profit (increasing by 40% to $156.6 million) projections. Juniper has built itself up by focusing on the router market and gradually branching into other areas, such as security. Because of its success, the company stands at an important crossroad. The vendor has also moved into the Ethernet switch market, an area of intense competition. This move came as it was becoming a multi-billion vendor and therefore must learn how to maneuver as a larger entity.

In recognition of these challenges, the vendor decided to bring in an experienced graybeard. Microsoft veteran Kevin Johnson was named CEO of Juniper Networks Inc., effective in September. Current Juniper CEO Scott Kriens will remain active with the company as the chairman of the board. Johnson, 47, led Microsofts Platforms & Services Division, an organization with more than 14,000 employees responsible for product development, marketing and strategy for the companys Windows and Online Services businesses. Under his leadership, the division recorded more than $20 billion in revenue in fiscal year 2008.

However, the change does have some potential downsides. Kriens has been at Juniper for 12 years and been the guiding force behind the companys growth. How it will fare now that he has less of role in the day-to-day operations is unclear. Also, Johsons star seemed to be dimming at Microsoft. Some link his departure to the companys recent failure to buy Yahoo, and Microsoft's online services losing $1.23 billion in operating income in fiscal 2008.

How graceful the handoff is from Kriens to Johnson will impact small and medium businesses. Cisco has fared extremely well in the networking market, dominating many different market sectors. Juniper has been a thorn in the Goliaths side, and with its recent foray into the enterprise switch market, one with a widening portfolio for the small and medium business. Time will tell if Johnsons appointment will maintain Junipers momentum.

Do you have any Juniper products? Are you concerned about the recent management changes? How good a job has the company done in attracting small and medium businesses?