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    2020 and CEO Bob Swan’s Impressive Year at Intel

    By
    Rob Enderle
    -
    January 8, 2021
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      When Bob Swan, Intel’s CEO, took over the company from beleaguered Brian Krzanich in 2018, it looked like he had inherited a train wreck. But he appeared to hit the ground running since he had been CFO and knew where all the bodies were buried. He had to rebuild the company that had been ravaged by ill-advised layoffs, a lack of focus on Intel’s core business and what had been a lengthy process of alienating Intel’s largest customers. 

      Frankly, had I been him, I’d have said “no thanks” and run for the hills. But he rolled up his sleeves and drove into the problems, making impressive changes and progress over the last 12 months. Let’s use this closeout week to go over some of what he accomplished.

      Refocusing Intel

      Intel’s strategy was in the dumpster when Swan took over, allowing him to reform the firm around a different concept. That concept was the XPU, a massive shift from Intel’s historic but languishing CPU strategy. More similar to how Qualcomm approaches the smartphone and tablet markets, the XPU is more of a complete solution than simply a collection of parts. This solution consisted of a multi-architectural solution containing large and small core CPUs, their new Xe GPU, Altera FPGA, Habana AI accelerators and other internal and acquired technologies. Intel stepped sharply out of its CPU comfort zone into something that looks more like Qualcomm’s successful Snapdragon strategy.  

      While Intel’s initial camera-focused approach to autonomous driving seemed to be a knee-jerk reaction to NVIDIA’s success in the same space, under Swan Intel fleshed out the solution into something far more compelling. By moving from parts to platforms, Intel created a viable alternative with unique advantages in the emerging self-driving car segment. Intel reported they are currently ranked No. 1 in the emerging advanced driver assistance market in 2020. 

      While there is some speculation that Intel may exit manufacturing, this is something I think is less likely, given the fulfillment problems tied to the pandemic. These problems forced many companies to rethink outsourcing manufacturing, particularly outside their country of origin. Under Swan, Intel has made several improvements. These improvements include better tools and improved foundries and disaggregated design principles that more efficiently lead to workloads that are optimized for cost and ensure that promised milestones are met.  

      These changes have helped Intel grow revenue by $20 billion since 2015 while improving the firm’s diversity at the same time. 

      Overcoming adversity to drive growth

      The changes Swan has made weren’t easy. For instance, under his leadership, Intel divested its 5G smartphone modem and NAND businesses. But he didn’t just divest; he also acquired Habana, Moovit and Bearfoot Network to complete his vision for Intel’s future. Intel remained the largest semiconductor manufacturer globally in 2020, primarily due to nearly doubling its manufacturing capacity during the last three years. Intel’s advancements enhanced this improvement in Superfin, the largest single intranode improvement in Intel’s history (Tiger Lake). 

      Intel also streamlined product roadmaps under Swan’s leadership and reached a better than 90% on-time delivery rate to customers, despite the pandemic shutdowns. This improvement is critical in a market currently plagued by product shortages and supply chain problems resulting from the global crisis.  

      These changes helped Intel grow significantly in new markets. For instance, when Intel was mostly in inference, its AI division grew to $3.8 billion in 2019, and the firm moved into training more aggressively in 2020. On top of all of this, Swan also drove rigor into Intel’s operations with improved transparency and accountability, with weekly checkpoints to ensure milestones and overcome one of Intel’s historical problems of missing critical expectations. 

      Wrapping up

      Coming in after someone else made a mess is problematic for a new CEO. Fortunately, as CFO, Bob Swan would have had an excellent idea where he needed to focus and stepped up to the challenge. As a result, Intel leaves 2020, despite the pandemic, in better shape than the firm entered the year and better positioned for the future. 

      If Swan and his team can keep up the pace, Intel should have a healthy 2021 as well. Intel is a critical national asset, and assuring its future isn’t just beneficial to Intel customers, employees and investors. It is critical to the future of the country. Fortunately, it is in good hands. In a year defined by bad news, I thought that pointing out some good news at the end of the year was appropriate. 

      Here is hoping you all have a safe and prosperous new year!

      Rob Enderle is a principal at Enderle Group. He is a nationally recognized analyst and a longtime contributor to eWEEK and Pund-IT.

      Rob Enderle
      https://enderlegroup.com
      Rob Enderle is a principal at Enderle Group. He is a nationally recognized analyst and a longtime contributor to eWEEK and Pund-IT. Enderle is considered one of the top 10 IT analysts in the world by Apollo Research, which evaluated 3,960 technology analysts and their individual press coverage metrics.
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