In 1988, Intel had a spectacular year. However, Andy Grove, Intel's CEO, wanted to reevaluate the company's position in "systems"--Intel's OEM PC, boards, and supercomputer businesses. This case explores Intel's position in both the semiconductor industry and its growing competition with its customers in systems.
Authors :: David B. Yoffie, Ralinda Y. Lurie, Ben Huston
Swot Analysis of "Intel Corp.--1988" written by David B. Yoffie, Ralinda Y. Lurie, Ben Huston includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Intel's 1988 facing as an external strategic factors. Some of the topics covered in Intel Corp.--1988 case study are - Strategic Management Strategies, Customers, International business, Mergers & acquisitions and Global Business.
Some of the macro environment factors that can be used to understand the Intel Corp.--1988 casestudy better are - – increasing commodity prices, there is backlash against globalization, banking and financial system is disrupted by Bitcoin and other crypto currencies, challanges to central banks by blockchain based private currencies, customer relationship management is fast transforming because of increasing concerns over data privacy, digital marketing is dominated by two big players Facebook and Google, increasing household debt because of falling income levels,
increasing energy prices, talent flight as more people leaving formal jobs, etc
Introduction to SWOT Analysis of Intel Corp.--1988
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Intel Corp.--1988 case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Intel's 1988, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Intel's 1988 operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Intel Corp.--1988 can be done for the following purposes –
1. Strategic planning using facts provided in Intel Corp.--1988 case study
2. Improving business portfolio management of Intel's 1988
3. Assessing feasibility of the new initiative in Global Business field.
4. Making a Global Business topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Intel's 1988
Strengths Intel Corp.--1988 | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Intel's 1988 in Intel Corp.--1988 Harvard Business Review case study are -
Effective Research and Development (R&D)
– Intel's 1988 has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Intel Corp.--1988 - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
High switching costs
– The high switching costs that Intel's 1988 has built up over years in its products and services combo offer has resulted in high retention of customers, lower marketing costs, and greater ability of the firm to focus on its customers.
Innovation driven organization
– Intel's 1988 is one of the most innovative firm in sector. Manager in Intel Corp.--1988 Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Low bargaining power of suppliers
– Suppliers of Intel's 1988 in the sector have low bargaining power. Intel Corp.--1988 has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Intel's 1988 to manage not only supply disruptions but also source products at highly competitive prices.
Analytics focus
– Intel's 1988 is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by David B. Yoffie, Ralinda Y. Lurie, Ben Huston can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Training and development
– Intel's 1988 has one of the best training and development program in the industry. The effectiveness of the training programs can be measured in Intel Corp.--1988 Harvard Business Review case study by analyzing – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Digital Transformation in Global Business segment
- digital transformation varies from industry to industry. For Intel's 1988 digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Intel's 1988 has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Organizational Resilience of Intel's 1988
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Intel's 1988 does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Diverse revenue streams
– Intel's 1988 is present in almost all the verticals within the industry. This has provided firm in Intel Corp.--1988 case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Highly skilled collaborators
– Intel's 1988 has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Intel Corp.--1988 HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Superior customer experience
– The customer experience strategy of Intel's 1988 in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Ability to lead change in Global Business field
– Intel's 1988 is one of the leading players in its industry. Over the years it has not only transformed the business landscape in its segment but also across the whole industry. The ability to lead change has enabled Intel's 1988 in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Weaknesses Intel Corp.--1988 | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Intel Corp.--1988 are -
Slow to strategic competitive environment developments
– As Intel Corp.--1988 HBR case study mentions - Intel's 1988 takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Aligning sales with marketing
– It come across in the case study Intel Corp.--1988 that the firm needs to have more collaboration between its sales team and marketing team. Sales professionals in the industry have deep experience in developing customer relationships. Marketing department in the case Intel Corp.--1988 can leverage the sales team experience to cultivate customer relationships as Intel's 1988 is planning to shift buying processes online.
Lack of clear differentiation of Intel's 1988 products
– To increase the profitability and margins on the products, Intel's 1988 needs to provide more differentiated products than what it is currently offering in the marketplace.
High operating costs
– Compare to the competitors, firm in the HBR case study Intel Corp.--1988 has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Intel's 1988 's lucrative customers.
Skills based hiring
– The stress on hiring functional specialists at Intel's 1988 has created an environment where the organization is dominated by functional specialists rather than management generalist. This has resulted into product oriented approach rather than marketing oriented approach or consumers oriented approach.
High bargaining power of channel partners
– Because of the regulatory requirements, David B. Yoffie, Ralinda Y. Lurie, Ben Huston suggests that, Intel's 1988 is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
No frontier risks strategy
– After analyzing the HBR case study Intel Corp.--1988, it seems that company is thinking about the frontier risks that can impact Global Business strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Compensation and incentives
– The revenue per employee as mentioned in the HBR case study Intel Corp.--1988, is just above the industry average. Intel's 1988 needs to redesign the compensation structure and incentives to increase the revenue per employees. Some of the steps that it can take are – hiring more specialists on project basis, etc.
Increasing silos among functional specialists
– The organizational structure of Intel's 1988 is dominated by functional specialists. It is not different from other players in the Global Business segment. Intel's 1988 needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Intel's 1988 to focus more on services rather than just following the product oriented approach.
Employees’ incomplete understanding of strategy
– From the instances in the HBR case study Intel Corp.--1988, it seems that the employees of Intel's 1988 don’t have comprehensive understanding of the firm’s strategy. This is reflected in number of promotional campaigns over the last few years that had mixed messaging and competing priorities. Some of the strategic activities and services promoted in the promotional campaigns were not consistent with the organization’s strategy.
Slow decision making process
– As mentioned earlier in the report, Intel's 1988 has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Intel's 1988 even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Opportunities Intel Corp.--1988 | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Intel Corp.--1988 are -
Using analytics as competitive advantage
– Intel's 1988 has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Intel Corp.--1988 - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Intel's 1988 to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Leveraging digital technologies
– Intel's 1988 can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Creating value in data economy
– The success of analytics program of Intel's 1988 has opened avenues for new revenue streams for the organization in the industry. This can help Intel's 1988 to build a more holistic ecosystem as suggested in the Intel Corp.--1988 case study. Intel's 1988 can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Intel's 1988 in the consumer business. Now Intel's 1988 can target international markets with far fewer capital restrictions requirements than the existing system.
Building a culture of innovation
– managers at Intel's 1988 can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Global Business segment.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Intel's 1988 can use these opportunities to build new business models that can help the communities that Intel's 1988 operates in. Secondly it can use opportunities from government spending in Global Business sector.
Developing new processes and practices
– Intel's 1988 can develop new processes and procedures in Global Business industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in Global Business industry, but it has also influenced the consumer preferences. Intel's 1988 can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Intel's 1988 can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Intel's 1988 to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Intel's 1988 to hire the very best people irrespective of their geographical location.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Intel's 1988 in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Global Business segment, and it will provide faster access to the consumers.
Buying journey improvements
– Intel's 1988 can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Intel Corp.--1988 suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Learning at scale
– Online learning technologies has now opened space for Intel's 1988 to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Threats Intel Corp.--1988 External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Intel Corp.--1988 are -
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Intel's 1988 can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Intel Corp.--1988 .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Intel's 1988 with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Shortening product life cycle
– it is one of the major threat that Intel's 1988 is facing in Global Business sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
High dependence on third party suppliers
– Intel's 1988 high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Stagnating economy with rate increase
– Intel's 1988 can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Intel's 1988 in the Global Business industry. The Global Business industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Environmental challenges
– Intel's 1988 needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Intel's 1988 can take advantage of this fund but it will also bring new competitors in the Global Business industry.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Intel's 1988 will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Intel's 1988.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Intel's 1988 needs to understand the core reasons impacting the Global Business industry. This will help it in building a better workplace.
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Intel's 1988 in the Global Business sector and impact the bottomline of the organization.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Intel Corp.--1988, Intel's 1988 may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Global Business .
Technology acceleration in Forth Industrial Revolution
– Intel's 1988 has witnessed rapid integration of technology during Covid-19 in the Global Business industry. As one of the leading players in the industry, Intel's 1988 needs to keep up with the evolution of technology in the Global Business sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Weighted SWOT Analysis of Intel Corp.--1988 Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Intel Corp.--1988 needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Intel Corp.--1988 is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Intel Corp.--1988 is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Intel Corp.--1988 is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Intel's 1988 needs to make to build a sustainable competitive advantage.