Most Important Aspects (Not a List of Everything That Might Have Mattered

Topic 2.2: Intel

Assignment Details:

• Due before Class of Week 8.

Synopsis

The Intel case illustrates how changes in added value can change the fortunes of a company. We will examine how Intel evolved from a memory chip company to a microprocessor company to the dominant microprocessor company. We will pay careful attention to how added value changed with this evolution. We will also investigate what Intel does to make sure that they not only have added value, but that they are able to capture that added value as profits.

Preparation Questions

Come to class prepared to discuss the following questions:

1. What are the lessons useful for their future microprocessor business that you think Intel should have taken away from their experience in the DRAM industry?

2. In the early years of the personal computer industry (approximately 1980-1982), who had the largest added value among the various participants in this industry? Why?

3. Intel begins in the microprocessor business without a lot of added value, and ends up with a lot. How and why did Intel’s added value change? That is, what crucial watershed moments, events, or decisions brought about that change?

4. What were the most important things Intel did between the late-1980’s and mid-1990’s to make sure that it obtained a large share of its added value as profits?

5. Which changes in the late-1990s and early-2000’s in the personal computer industry do you see as the most significant threats to their profitability that Intel has had so far? Why? Do you think its responses are likely to be effective? Are there other things you think it should do?

Individual Assignment

Prepare a 1-page memorandum that answers question #3. Aim to focus your attention on the most important aspects (not a list of everything that might have mattered). Choose one or two things to discuss in detail.