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Netgear: Tops in productivity

Apr 26, 20042 mins
Cisco SystemsSmall and Medium BusinessWi-Fi

Netgear debuts on the NW200 with distinction as the most productive company.

One quick conversation with Netgear CEO Patrick Lo is all it takes to understand how this small office/home office equipment maker came to carry the NW200 title for most productive, having pulled in $1.4 million per employee in 2003. Lo is enthusiastic and energetic, passionate about changing the way people live and work.

“I would like everybody here to love coming to work everyday because they know they’re participating in a mission that’s revolutionary,” Lo says. “We’re promoting the Internet revolution around the world. We’re doing something really big for mankind.”

That is, Netgear is outfitting homes and small offices with some of the most advanced, easy-to-use and reliable Ethernet switches, broadband routers and wireless LAN switches available for SOHO buyers. Lo says he loves the idea that Netgear equipment is leveling the playing field for small businesses.

Lo’s enthusiasm must be contagious. In 2003, Netgear reached $299 million in revenue with an employee count of 207. By comparison, Netgear’s archrival Cisco generated about $583,000 in revenue per employee, according to NW200 statistics.

Netgear, No. 100 on the NW200, closely monitors revenue per employee – the amount of revenue should grow hand in hand with the number of employees, Lo says. But operating profit per employee is an important benchmark for the company, too. Netgear, which posted a $13 million profit in 2003, is positioned to achieve operating profit of $120,000 per employee for 2004, Lo says. Lo is gunning for the $160,000 mark, which just happens to be Cisco’s benchmark, he says.

“In networking, everyone looks to Cisco as best in class. So if its operating profit per employee benchmark is $150,000 to $160,000, that’s what we’re marching toward,” Lo says. “Then we’ll evaluate if we can set the bar higher.”