Intel Hbs Case
5. Evaluate Intel’s shift in strategy under CEO Craig Barrett and new CEO Paul Otellini.
Craig Barrett’s strategic focus was on innovation and R&D. He aggressively built new businesses thru acquisitions and internal ventures, to the tune of $12 billion. Under his leadership, Intel entered a myriad of new markets – wireless, networks, communications, and online services. In 1999, he changed the corporate mission statement. Intel went from “being the preeminent supplier to the new computing industry worldwide” to “being the preeminent building-block supplier to the worldwide Internet economy”. He reorganized the company into four key areas – client platforms, server platforms, cellular and wireless, and communications and networking.
As for client platforms, he targeted innovation on an architectural level. In response to AMD, Intel sought to stay ahead by 12-18 months in process technology. He also targeted corporate buyers who were less price sensitive and more technically savvy. With server platforms, most of Intel’s energy went towards the high-end server segment that ran corporate data centers. Many of the innovations made by the server group made their way into mainstream processors. The Wireless and Cellular group focused on the wireless Web, which allowed people to access the Internet from cellular phones and other handheld devices. In 2002, Intel separated the application subsystem from the communication subsystem in the hopes that the separation would speed up the development and deployment of wireless Internet devices. The Networking and Communication team focused on the mass production of lower cost interchangeable devices. They wanted to provide the industry with standard building blocks through Internet Exchange Architecture (IXA), which allowed for more mass-produced, lower-cost, and interchangeable devices.
As the COO of the company, and head of Intel’s clients, servers, and communications businesses, Paul Otellini’s long term
Craig Barrett’s strategic focus was on innovation and R&D. He aggressively built new businesses thru acquisitions and internal ventures, to the tune of $12 billion. Under his leadership, Intel entered a myriad of new markets – wireless, networks, communications, and online services. In 1999, he changed the corporate mission statement. Intel went from “being the preeminent supplier to the new computing industry worldwide” to “being the preeminent building-block supplier to the worldwide Internet economy”. He reorganized the company into four key areas – client platforms, server platforms, cellular and wireless, and communications and networking.
As for client platforms, he targeted innovation on an architectural level. In response to AMD, Intel sought to stay ahead by 12-18 months in process technology. He also targeted corporate buyers who were less price sensitive and more technically savvy. With server platforms, most of Intel’s energy went towards the high-end server segment that ran corporate data centers. Many of the innovations made by the server group made their way into mainstream processors. The Wireless and Cellular group focused on the wireless Web, which allowed people to access the Internet from cellular phones and other handheld devices. In 2002, Intel separated the application subsystem from the communication subsystem in the hopes that the separation would speed up the development and deployment of wireless Internet devices. The Networking and Communication team focused on the mass production of lower cost interchangeable devices. They wanted to provide the industry with standard building blocks through Internet Exchange Architecture (IXA), which allowed for more mass-produced, lower-cost, and interchangeable devices.
As the COO of the company, and head of Intel’s clients, servers, and communications businesses, Paul Otellini’s long term