Hector Ruiz advises Intel to split up
First off, Hector Ruiz is the man who is responsible for the state of AMD as it is right now. Now speaking to BusinessWeek, former AMD CEO Hector Ruiz gave some advice to Intel's next CEO on how to take the company forward. Ruiz explains Intel is no longer the firm it was a decade ago, and says Intel needs to make clear to the world that it's in the computing business, and not purely a PC company. Second, Ruiz says Intel would do well to split up the company and move toward becoming a portfolio company consisting of autonomous business units, each with a clear vision and value proposition.
Divvy up the company. Intel dominates the PC market, and the PC market dominates Intel. The company needs to get out of its own way or risk going the way of Boeing (BA), a masterful maker of jumbo jets that entirely missed the boom in regional travel. In that case, Brazil’s Embraer (ERJ) saw the need for smaller commuter planes and, having achieved dominance in that market, is now challenging Boeing on its turf. Intel can’t let its powerful PC business squash innovation that could help it establish leadership in mobile technology; soon its competitors in mobile may get strong enough to eat away at its PC market share, especially with the advent of new three-dimensional interconnect technology for microprocessors—where no one yet has the competitive edge.
My advice to Intel: Split the businesses.
Move toward becoming a portfolio company, with autonomous business units, each of which has a clear vision and value proposition. One focused on big data and the high-end market for servers, another focused on the PC and similar markets, and a third dedicated entirely to mobility. With intelligent restructuring, they all can benefit enormously from the parent’s superior manufacturing capability. Then revisit and, if necessary, repeat the process in three to five years.
Considering the state in which Ruiz left AMD we doubt Intel's next CEO will take advice from him.