New Intel boss quick to shake things up
After just 30 days on the job, Brian Krzanich has shaken up the chipmaker with a sweeping reorganisation that emphasises innovation and, perhaps, leapfrogging troublesome competition in the mobility market
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New Intel CEO Brian Krzanich is making his presence known, implementing a sweeping reorganisation that places all of the product groups under his direct supervision.
Krzanich, who assumed control from longtime predecessor Paul Ortelli a month ago, initiated the immediate restructuring yesterday. The intent, analysts and insiders say, is to catch up to and leapfrog rivals in the burgeoning mobility segment.
"As your CEO, I am committed to making quick, informed decisions. I am committed to being bolder, moving faster and accepting that this means changes will be made knowing that we will listen, learn and then make adjustments in order to keep pace with a rapidly changing industry," Krzanich wrote in an internal e-mail.
Under the reorg, most of the product and development groups will fall directly under Krzanich. Corporate strategy and global manufacturing will fall under Renee James, the company's new president and previous head of the software group. The software group will fall under Doug Fisher, and Hermann Eul will assume full responsibility for the smartphone chip unit.
The fate of Dadi Perlmutter, who had overseen the product groups, remains undetermined. Krzanich reportedly told employees his new role and responsibilities will be defined following the management transfer.
While Intel remains a strong and vibrant company, it's been slow to respond to the explosive growth in the mobility market, namely chips and controllers for smartphones and tablets. Rivals Qualcomm and Samsung Electronics have capitalised on the mobile chip market with products based on the ARM processor.
The reorganisation, analysts say, is a clear signal Krzanich is listening to his advisors and ignoring calls to play catch up with the market. Instead, the moves are intended to push Intel toward emerging products and opportunities in the mobile device market.
The shakeup is also acknowledgement that Intel did let a market opportunity slip by when it didn't move fast enough on mobile products. At its recent Intel Solutions Summit in Los Angeles, Intel channel executives spoke at length about new generations of ultrabooks, all-in-one devices, convertible PC/tablets and even large-format mobile computers as the next big opportunity. Intel's confidence in such devices will revive the flagging PC market, which saw sales decline 14 per cent in 2012.
"Our business faces significant challenges, and we simply must continue to execute while finalising our future strategy," Krzanich wrote.
Intel's strength over the past four decades is being the influencing - if not dictating - force in IT design. Anything that had a chip, Intel held sway over. That produced huge revenues for Intel through a system of mutual development with device manufacturers, and a reservoir of cash that flowed out to the channel.
If successful, Intel could find itself in a position to call the shots in product development and go-to-market strategy through the entire value chain, including the channel. While Intel has maintained that position, most famously in its rivalry with AMD, its new competitors - particularly Samsung - are proving more adept and innovative.
Intel actually has a real fight on its hands.
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