Intel Reorganizes In Wake of 7nm Woes; Chief Engineering Officer Murthy Renduchintala To Depart
by Ryan Smith on July 27, 2020 5:30 PM EST
Coming in the wake of last week’s disclosure that their 7nm yields are roughly a full year behind schedule, Intel this afternoon has announced that they are reorganizing the technology side of the company. Key to this change is that Intel is breaking up its monolithic Technology, Systems Architecture and Client Group (TSCG) into several smaller groups, all of which will report directly to CEO Bob Swan. Meanwhile Intel’s chief engineering officer, Dr. Murthy Renduchintala, who had been leading the TSCG, will be departing the company at the end of next week. The reorganization is effective immediately.
As a result of this reorganization, TSCG is being broken up into five groups focusing on manufacturing and architecture. These are:
- Technology Development: Focused on developing next-generation process nodes. Led by Dr. Ann Kelleher.
- Manufacturing and Operations: Focused on ramping current process nodes and building out new fab capacity. Led by Keyvan Esfarjani.
- Design Engineering: A recently-created group responsible for Intel’s technology manufacturing and platform engineering. Led on an interim basis by Josh Walden while Intel searches for a permanent leader.
- Architecture, Software and Graphics: Developing Intel’s architectures and associated software stacks. Led by Raja Koduri (continuing).
- Supply Chain: Handling Intel’s supply chain and relationships with important suppliers. Led by Dr. Randhir Thakur (continuing).
It should be noted that while Intel’s brief announcement does not mention last week’s disclosure, the timing and resulting personnel changes are unmistakably related to the 7nm delay. Today’s reorganization is the second shuffle for Intel in as many months, as the company reorganized a number of product groups after Jim Keller departed for (honest to goodness) personal reasons.
Meanwhile, TSCG’s former president, Dr. Murthy Renduchintala, will be departing the company on August 3rd. Renduchintala joined Intel in 2015, and for most of the past half-decade has been responsible for overseeing all of TSCG’s efforts, and especially involved in the development of the company’s next-generation process nodes. Intel’s reorganization announcement makes no specific mention of Renduchintala beyond his date of departure, however it is difficult to imagine that this is anything other than Intel pushing out Renduchintala in light of their process woes. More than anything else, Renduchintala was the face of Intel’s monolithic, vertically-integrated design and manufacturing strategy; a strategy that is no more as Intel seriously investigates building parts of leading-edge processes at competing fabs.
Going forward, the task of developing Intel’s 7nm and 5nm process nodes will be led by Dr. Ann Kelleher. Kelleher gets the incredibly important (but less-than-enviable) challenge of getting Intel’s fab development process back on track, as Intel seeks to regain its crown as the world’s leading chip fab. Kelleher was previously the head of Intel’s manufacturing group, overseeing the recent ramp-up of Intel’s 10nm process. Meanwhile Dr. Mike Mayberry, a central figure in Intel’s labs who was already set to retire this year, will be staying on until then to assist in the transition.
Overall, while Intel’s reorganization is unlikely to dramatically change the company’s day-to-day operations, it’s very much the start of a new era for the company. As Intel’s ongoing manufacturing woes have driven them to look towards outside fabs for more products, the company’s traditional vertically-integrated structure is less than ideally suited for the task – and as much as Intel manufacturing would like to keep Intel-designed products within the company, Intel’s chip and architecture groups need to be able to freely look elsewhere. And this reorganization is going to be an important step in enabling that.
Source: Intel
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Lord of the Bored - Monday, July 27, 2020 - link
How would The Rona and current political environment make it harder to get engineers from the Republic of China or South Korea than from the People's Republic of China? It seems the opposite would be true.Kamen Rider Blade - Monday, July 27, 2020 - link
I'm only talking about China specifically.Taiwan / South Korea are a different matter entirely.
Peskarik - Tuesday, July 28, 2020 - link
After Biden? :-)))))))SystemsBuilder - Monday, July 27, 2020 - link
OMG - This is terrible management!Why on earth is the CEO first announcing the problems with 7nm etc in an earnings call with some weak action plan (outsource to another fab).
Then he sort of notices the dramatic share price drop and scrambles over the week end to quickly assign blame and come up with some quick reorg that he the announces today Monday.
This way the CEO looks like he was caught flatfooted sort of not understanding the seriousness of the situation (like not understanding that the core strength that drove Intel to where it is today is failing!), did not understand that the market would punish Intel fro that. he then almost in panic mode scrambles to assign blame and fix the org - REACTIVE!
What he should have done - (like a investor relations 101):
If you have bad news you present the bad news WITH a solid plan to address them in the earnings call! Not 4 days later...
Conclusion: the CEO does not know what he is doing and he is ultimately accountable for what happens in the company! He cannot assign blame for this - that is not how accountability works in a world where the board and investors calls the shots!
We hold the CEO accountable.
The CEO needs to go.
Intel have plenty of competent executives with strong bottom-up engineering background.
Get one of them that knows what he/she is doing to run the company.
Kamen Rider Blade - Monday, July 27, 2020 - link
Bob Swan is a first time CEO.https://en.wikipedia.org/wiki/Bob_Swan
The only other time he was CEO, he was CEO for Webvan.
That job lasted 4 months before the company went under.
Bob Swan is a NOOB at being a CEO.
Peskarik - Tuesday, July 28, 2020 - link
Exactly, first time CEO getting played like a fiddle, learning by doing (time), getting paid tens of millions for his school and for destruction of jobs. What a crying shame!flgt - Tuesday, July 28, 2020 - link
He didn’t decide to do it this week. I’m sure the production slips were becoming clear and they decided to let Murthy go weeks or months ago . This announcement was going to impact billions of dollars of investments in a publicly traded company. If they announced his departure first it would have led to even more chaos. They decided to lead with the production slip at the investor call and announce the firing after.SystemsBuilder - Tuesday, July 28, 2020 - link
and that is NOT how you do it!You do it at the same time: present problem, the root cause analysis and a credible action plan to address the problem - Investor Revelations 101. (or any management/board meeting for that matter).
Sometimes it may even be smart to lead with the solution: start talking about what you are doing, what you have done before you get to connecting it to a problem and then explain how these actions address the problem - Corporate communications 101.
You NEVER come with a problem without presenting what you have already done and a plan going forward to 100% solve it. Doing it the opposite sequence is incompetent.
The communications mistake was to present a fundamental problem with a weak plan on the earnings call surprising the investors so he had to come back 4 days later with a more forceful one. This makes the CEO look reactive and incompetent - which is what he is!
Spunjji - Friday, July 31, 2020 - link
Unless you want your stock price to dip and then recover, for some mysterious reason. But that would be insider trading, and we know nobody ever does that because it's illegal, right? 😂Sailor23M - Tuesday, July 28, 2020 - link
^This. Also I have worked at lots of large companies have stumbled in their R&D efforts, the answer is unfortunately not to look outside but double/triple down. As mfg and fabs become more and more complex its a source of competitive advantage. Going outside to TSMC/Samsung will just raise cost and drain talent where you will be fully dependent on the external fab for all your future production. The company needs to focus on fixing the 7nm issues and take a longer term view.