Submitted by:-Ankita JainMonika StanPalak MittalSahil NarangSwati TomarWartika Vashisht

OverviewOverviewCompany Overview

◦ History◦ Mission Statement◦ Goals and Objectives

Core ValuesExternal Environment

◦ Competition◦ Industry Life CycleIndustry Life Cycle◦ R & D

Overview (Continued)Overview (Continued)The Intel Case: Fading Memories (Burgelman,

1991, 1994)Leadership & Capabilities Model (LCM)Reconsidering the Intel caseObservations and ConclusionsPRODUCT AND SERVICES Internal Environment

◦ Current Financial Performance vs. RivalsSWOT AnalysisSWOT MatrixBGC MatrixFuture

Company OverviewCompany Overview Intel is the world's fifth most valuable brand

valued at around $35 billion. It is the inventor of the X86 series of

microprocessors, the processors found in most personal computers.

Intel also makes motherboard chipsets, network interface controllers and integrated circuits, flash memory, graphic chips, embedded processors and other devices related to communications and computing.

HistoryHistory1968  Robert Noyce and Gordon Moore incorporate

NM Electronics .1970  The development of DRAM and dynamic RAM1971  The world’s first microcomputer is introduced 1974  The first general purpose microprocessor is

introduced to the world1992  Intel’s net income tops the one billion dollar

point 1993   The Pentium is introduced, a fifth generation

chip  1997, The Pentium 11 microprocessor is introduced

to the world 1999 Intel is added to Dow Jones Averages. 2000 The world’s very first Intel 1 gigahertz

processor  hits the shelves. 

Mission StatementMission Statement

“Delight our customers, employees, and shareholders by relentlessly delivering the platform and technology advancements that become essential to the way we work and live. “

Geographic ReachGeographic Reach Philippines Malaysia

Shanghai Israel Ireland Massachuse

tts Costa Rica New Mexico Colorado Arizona California Oregon

Company ObjectivesCompany ObjectivesExtend our silicon technology and

manufacturing leadership.Deliver unrivaled microprocessors and

platforms.Grow profitability worldwide.Excel in customer orientation.

Company ValuesCompany Values• Customer orientation• Results orientation • Risk taking • Great place to work • Quality • Discipline

“Our values are timeless and do not depend on businessconditions.”

—Andy Grove, Intel Chairman

IntelIntel

10

IntelSuppliers

Competitors

Substitutes

Channel CustomersKyocera, etc

Motorola

AMD, TI, Cyrix

RISC

日本の DRAM

END

USER

Licensees-IBM-Others

DirectIBM

CompaqDell

Packard Bell

CHANNEL

SoftwareProviders• OS• Application

collaborators

Identifying the problemIdentifying the problemDue to a number of clone products in

the market, Intel was unable to differentiate its products from the herd.

Consumers were left baffled for choice and often guessing as to the content and performance of MP.

Consumers knew Intel through its product offerings which were often being cloned. Intel wanted consumers to recognize its product through the brand Intel itself that connoted reliability and superior performance.

Developing Strategic Developing Strategic SolutionSolutionIntel Coop Program marked the

birth of brand Intel.The program intended to levitate

Intel as a brand through 3 strategic steps:

1.Developing and using a brand logo in advertisements of OEMs.

2.Engaging tier 2 and 3 OEMs in the program via profitable propositions.

3.Prolific advertisement to create awareness about importance and superiority of Intel chips.

Implementing the Coop Implementing the Coop ProgramProgramDesigning a unique logo.Convincing tier 2 and 3 OEMs

initially of the short term and long term benefits of alliance and engaging them.

Direct advertisement aimed at organizational rather product communication thus enabling a ‘brand consumer connect.’

Assessing the programAssessing the programAwareness of Intel logos prior to IB strategy

was a meagre 24% in European PC market.That, within 2 years of its launch soared wildly to 94%

Worldwide sales within a year of launch of IB strategy rose by63%.

By 2002 Intel broke into the list of top 10 most valuable brands.

Power of Intel brand Power of Intel brand equityequity

Leveraging Brand EquityLeveraging Brand EquityYear Brand Equity

Interbrand Rank2008: $31,261 mln 72007: $ 30,954 mln 72006: $ 32,319 mln 52005: $ 35,588 mln 52004: $ 33,499 mln 52003: $ 31,112 mln 5

2002: $ 30,860 mln 52001: $ 34,670 mln 5

Intel Memory Market Share and SalesIntel Memory Market Share and Sales(Adapted from Burgelman, 1994; (Adapted from Burgelman, 1994; Grosvennor, 1993)Grosvennor, 1993)

Estimated memory Sales and Estimated memory Sales and Estimated Microprocessor Estimated Microprocessor SalesSales (Adapted from Burgelman, 1994; Grosvennor, 1993) (Adapted from Burgelman, 1994; Grosvennor, 1993)

Brief ConclusionBrief Conclusion Strategic decision in 1984 to exit memory was

“sensemaking” after-the-fact

Intel’s internal selection environment, i.e., “the production rule”that favored microprocessors, was more adaptively robust that top-down strategy

Combination of top-down strategy and bottom-up, or autonomous, strategy is enacted at firms

• Importance of knowing how and when to bring top-level official strategy in line with bottom-up strategic action

• Such realignment does not necessarily involve a change in leadership

Intel Corp: Cost and price Intel Corp: Cost and price curvescurves

Intel’s Strategy with Intel’s Strategy with DRAMDRAM

Innovative Design: Intel was the first to develop DRAM. Moor’s Law was the brain child of Gordon Moore who was the founder. The law was based on the demand of memory . Intel also produced World’s first 1Kb DRAM.

Price High in early life-cycle: make money and reinvest in subsequent generations.

Move Quickly to New generations: As competitors offered substitute products and overall market price decreased, Intel moved to new generations.

Thus, Intel emphasis was on product design, not so much on process development or realizing efficiencies through manufacturing .

Why was Intel unsuccessful Why was Intel unsuccessful in the DRAM Market?in the DRAM Market?Wrong Strategy

◦Intel though that pushing product design through new features

◦Lack of process capabilities and efficient manufacturing capabilities resisted putting new features to market.

◦Japanese also entered the EPROM market

What did Intel learn? What did Intel learn? Be careful with unidimensional (one

product) strategyProtect your technological

innovations or avoid commodity business. When a novel technology becomes a commodity, the company(s) with higher manufacturing capability wins.

Competitive advantage is temporary. Life span of strategies are getting shorter.

Use current profits to develop complimentary capabilities.

Creating and sustaining Creating and sustaining competitive advantage in competitive advantage in microprocessors microprocessors

Some Important Strategic Some Important Strategic IdeasIdeasWhere is the most “value” in a computer? Success attracts competition, company must

protect against ◦ 2005 Intel has 82% of PC processor market

Technology moved so rapidly that patents became obsolete◦ protect by know-how, branding, scale, luck

Small stuff that goes inside other stuff◦ Allows focus, expertise, scale, “piggy-backing”

Thrived on derived demand driven growth and rapid change