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Assignment 07 - Intel

Strategic Management Individual Assignment analyzes Intel's strategy development processes over three epochs. [1] In epoch 1, Intel utilized a learning organization process. [2] In epoch 2, it used resource allocation routines and strategic planning, which lacked creativity. [3] In epoch 3, externally imposed strategies helped diversification but created communication issues. The document proposes a matrix structure and entrepreneurial units to maintain competence and innovation as Intel diversifies.

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FazlanMarikkar
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785 views

Assignment 07 - Intel

Strategic Management Individual Assignment analyzes Intel's strategy development processes over three epochs. [1] In epoch 1, Intel utilized a learning organization process. [2] In epoch 2, it used resource allocation routines and strategic planning, which lacked creativity. [3] In epoch 3, externally imposed strategies helped diversification but created communication issues. The document proposes a matrix structure and entrepreneurial units to maintain competence and innovation as Intel diversifies.

Uploaded by

FazlanMarikkar
Copyright
© Attribution Non-Commercial (BY-NC)
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Strategic Management

Individual Assignment

Ba (honors) in business & management

Offered by Cardiff metropolitan university

Strategic management
Assignment 08 Intel
Word count - 1044

Submitted to: Mr. Shane De Silva

M.F.M.M Fazlan ICBT/ BABM/07/30

Strategic Management

Individual Assignment

1. Introduction
Intel Corporation is an American multinational semiconductor chip maker corporation headquartered in Santa Clara, California. Intel is the worlds largest and highest valued semiconductor chip maker. Intel Corporation is founded on July 18, 1968. 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.

2. The Different Strategy Development Processes Operating in Intel


Intel uses many different strategy development processes in different epochs. There strategy developments for each epoch are different from each other. In epoch 1 the company utilized learned organization as their strategic development process. In epoch 2 the company used resource allocation routines and strategic planning as their strategic development processes. In epoch 3 the company utilized externally imposed strategies as their strategy development process. There are many similarities and differences from each strategy. Epoch 1 and the strategy development process of strategic planning in epoch 2 were processes which added discipline to the organization however epoch 2 lacked creativity and innovativeness when compared to epoch 1. The strategy development process of resource allocation routines in epoch 2 and the strategic development process in epoch 3 were used with the strategic intent to maintain the position of Intel as a technological leading edge company. When they are setting their strategies, they focus only in the financial point of view. They focus only about the cost and the profit. But they should focus in the marketing point of view as well.

Strategic Management

Individual Assignment

3. The Effectiveness of those Different Processes


The strategies should align processes to strategic context. Processes in Intel changed as time went by sometimes by design and intent; sometimes not. But arguably the processes suited the context. Processes should be less top down when innovation is required by the environment. It is not a matter of a process always producing a good performance, but a matter of the right process for the context the organization is working in at that moment. The strategy development process in epoch 1 was effective in providing a clear understanding of what is expected out of the employees since the process was structured, disciplined and had control. It helped the company to come up with innovative ideas through employee participation, for an example: the development of microprocessors. The strategy development process of resource allocation routines in epoch 2 was highly ineffective as the managers were unable to use the provided freedom to make both DRAM and SCRAM businesses survive. This in turn also indicates how badly the process has affected the performance of the business. The strategy development process of strategic planning in epoch 2 was also highly ineffective as the business plans created by each business unit lacked innovativeness and renewal to drive success. The strategy development process in epoch 3 was highly effective as the company was able to successfully diversify their product line significantly.

4. The Tensions between Processes within Each Epoch


Between Epoch I and II the tension was around staying true to what had made the company successful in product terms versus staying true to innovation and therefore letting go of old products and changing processes to meet this challenge. Between Epochs II and III the tension was around how to, on the one hand, cope with getting big and on the other hand stay innovative. Whilst such tensions might be uncomfortable, arguably they were inevitable and even productive.

Strategic Management

Individual Assignment

Epoch 1 Logical instrumentalism - Information was passed down only to engineers and marketers. Epoch 2 Resource Allocation Routines - Resources could have been allocated through using other criterions as well but the company preferred to use profit as their only criterion to allocate resources. This process provided too much strategic freedom for mangers which ultimately lead to the demise of both DRAM and SRAM businesses. Strategic Planning - The combination of formality and discipline included in this process has created a rigid environment which limits the creativity and the innovativeness of the business units when making long term plans. Epoch 3 Externally imposed strategies -The use of this process has helped the company to expand significantly through mergers and acquisitions. An expansion of this caliber is bound to create communication problems thus creating conflicts and misconceptions between all the employees in the organization.

5. The Proposal for the Most Appropriate Strategy Development Process that Should exist as Intel Moves into a more diversified business model
Matrix structures can ensure competence is maintained in technical and functional areas to create products that work and are innovative and embed technological convergence into them. Interand intra-organizational entrepreneurial units, given the freedom to generate new processes, can be considered. Being big can mean investment in R&D can continue in down-turns. Intel can simultaneously exercise effective control and ensure good levels of profitability and return, whilst achieving innovation and the diversity it believes facilitates innovation.

Strategic Management

Individual Assignment

Their both epoch 1, epoch 2 and epoch 3 consists of strategy development processes which are effective, highly effective, highly ineffective. The strategy development processes in epoch 2 also should not be continued as it is highly ineffective mainly because as one process provided too much freedom which ultimately lead to the destruction of two companies and the other process lacked creativity and innovativeness. The strategy development process in epoch 3 should be continued as it is highly effective in terms of diversification, exploiting new markets, creativity and innovativeness and all these elements are more than enough to maintain or improve the position of Intel in the long run.

6. Conclusion
Intel has developed many strategy development processes. They have developed by their own ideas rather than adapting to the changes in the environment. Adapting to environmental change is vital for organizations for example encyclopedia swept out of the market because of that. Intel was a company which was holding on to the same strategy development process or processes for quite a long time instead of adapting to the changes in the external and internal environment. This was visible in epoch 1 and epoch 2. The company has not used the strategy development process of learning organization properly therefore it would be advisable to make full use of learning organization and use it along with the process of externally imposed strategies. Additionally the process of learning organization will help to develop new capabilities and also it will help to consolidate the existing capabilities.

References
Intel. 1968. Company Overview. [ONLINE] Available at: http://www.intel.com/content/www/us/en/homepage.html. [Accessed 19 July 13 Johnson, G, Scholes, K, Whittington, R. (2008). Strategy Development Processes. In: Prentice Hall Exploring Corporate Strategy. 8th ed. Essex: Prentice Hall. p400.

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