The Chip Insider®–TSMC'S True Cost: Lip Bu Tan’s Intel Challenge

Lip Bu Tan’s Intel Challenge: By now I’m sure you know that Lip Bu Tan has taken the helm of Intel. Intel was in limbo for exactly 105 days between Lip Bu’s first day and Pat’s departure. Why so long? … Lip Bu is an industry legend, with an impeccable reputation, having turned around Cadence. The question is, can he turn around Intel? His background is mainly in EDA. Before that … Having served on Intel’s board and leaving under a cloud, I’m sure he has a good idea of what’s wrong with the company and what fixes are most urgently needed. There are the oft-cited financial issues stemming from attempting to build unneeded fabs based on wishful thinking about foundry demand. On top of this is its high BMI (Bureaucratic Mass Index), which is costly and slows decision cycle times (DCTs). Intel has been on the organizational equivalent of GLP-1s to lower its BMI. However, it’s not an overnight process

Beyond those, here’s my take on four strategic challenges that have often been overlooked:

• Intel’s dual-future problem
• Loss of scale
• Intel's product marketing failure
• The foundry business is a marathon, not a sprint

Intel’s dual-future problem: The company is split, with one group that lacks a future while generating revenue today, and a second with a future that can’t pay for its keep today…

Maxims: Innovation barriers and Bureaucracy chokes product development. It is a mistake to believe that the primal drive to meet quarterly numbers is the sole reason why big companies fail to make big… breakthrough innovations. There are three underlying problems one needs to attack to solve the problem of underwhelming innovation in a big company: 1) lack of R&D accountability, 2) Long Decision Cycle Times (DCTs), and 3) Structured Risk Aversion…

“The present is the new future...that where you sit, you create everything that’s going to come” — Sarah Jones