By Noel Randewich
SAN FRANCISCO May 21 Intel Corp's new
chief executive, Brian Krzanich, has launched a sweeping company
reorganization and created a unit aimed at growing its market
share in mobile technology.
The shakeup, announced internally just days after the
30-year veteran took the helm, places most of the main product
groups of the world's top chipmaker directly under the CEO's
supervision and hands its sprawling global manufacturing
operation to new president Renee James, said a source close to
the company, who declined to be identified.
Details of the reorganization were outlined in an internal
memo sent to employees on Monday. It was described to Reuters by
a company source and details of the reorganization, which is
effective immediately, were confirmed by spokesman Chuck Mulloy
"As your CEO I am committed to making quick, informed
decisions. I am committed to being bolder, moving faster, and
accepting that this means changes will be made knowing that we
will listen, learn and then make adjustments in order to keep
pace with a rapidly changing industry," Krzanich said in the
email, according to the source.
"Our business faces significant challenges, and we simply
must continue to execute while finalizing our future strategy,"
he reportedly wrote.
Krzanich officially took over as CEO last week and said that
under his leadership, the top chipmaker will be more responsive
to customers in an intensified focus on the fast-growing
smartphone and tablet market where it lags rivals.
The chipmaker's main product groups - including the PC
client group, mobile communications and data center unit that
previously reported to Intel Architecture group chief Dadi
Perlmutter - now report directly to Krzanich.
After Perlmutter transfers his business groups, he and
Krzanich will "define his next significant contribution at
Intel," according to the email described by the source.
Intel has called the shots in the personal computer industry
for decades, but it was slow to react to the explosion of
smartphones and tablets. The latter two markets are now
dominated by competitors like Qualcomm Inc and Samsung
Electronics Co Ltd, which design their chips using
architecture licensed from ARM Holdings Plc.
In his three-decade career at Intel, Krzanich has become
known for making fast decisions after consulting with trusted
This week's reorganization is Krzanich's first step in a
process aimed at making Intel more focused and more agile,
Mike Bell will head up Intel's newly formed "new devices"
group," which Mulloy said will focus on emerging product trends.
"The new devices organization is responsible for rapidly
turning brilliant technical and business model innovations into
products that shape and lead markets," Krzanich said in the
email, according to the source.
James, formerly head of the software arm, will now also
oversee the company's sprawling global manufacturing operations
and all aspects of security technology.
Mulloy said Intel presidents have traditionally been
responsible for managing the manufacturing operations.
James will also lead corporate strategy and planning. Her
previous job as Intel's software chief has been taken over by
Doug Fisher, a senior executive from that group.
Hermann Eul previously shared responsibility for Intel's
mobile communications group, which makes smartphone chips, with
Bell, and he will now take full responsibility for that
Senior Intel executives in the past have privately warned
against focusing too much on catching up in smartphones and
tablets at the expense of missing out on future trends in
Krzanich's creation of the "new devices" group signals he is
also looking beyond today's gadgets.
"It's a matter of what they do with the new division, what
can they identify and then deliver that maybe would not have
otherwise been something we'd see Intel inside of. It could be
very meaningful if they can execute," said Williams Financial
analyst Cody Acree.
Venture capital fund Intel Capital, led by Arvind Sodhani,
now reports to Chief Financial Officer Stacy Smith instead of to
the CEO. Intel's IT department, which reported to Krzanich
before his appointment as CEO, will also now report to Smith.
Shares of Intel were up 0.2 percent at $24.13 on Tuesday
afternoon on the Nasdaq.