Friendly recommendations from investor point of view to fix intel

From my point of view intel’s problem is 70p execution issue and 30p macroeconomic.

Before sharing my path to recovery, let’s take a look how intel ended up in this state.

Over the past 15 years intel has made huge business mistakes such as exiting GPU in 2009, not accepting Apple offer to work on iPhone, etc. however, the most important one started around 2017-18 when Intel become no longer an attractive place for young engineers to work. The primary reason was giving lower than avg market compensation. AMD, TSMC, and Samsung started hi------g top talent.

Now let’s talk how to fix this as I believe it’s never late! Intel needs to reduce management headcount similar to Facebook as Mark outlined. Intel has too many management layer and high ratio to engineers from what I have heard.

Total Headcount should be around 95k for company. Reducing headcount to this level is necessary to balance OpEx and margins.

Give the best and higher than average compensation that your top talent will never leave or think about it. There is a famous saying which says, “take care of your employees and they will take care of your business”

During 2008 crash I remember job market was much worst than 2023, but still top talented engineers found new jobs. Just go to LinkedIn and see still Meta and google hire top talent. Salary, bonus, 401k match was the worst decision that a company could make. This forces your top engineers to leave. You maybe happy that lowers headcount without cost of layoffs, but consequences are much worst on projects.

Intel should completely eliminated the dividend.

As I said, take care of your employee and they will take care of your business.

If you have 15 employees unhappy because of pay cuts vs 10 employees pay with higher than avg market comp. Which one works better and motivated?

Lastly, in Santa Clara AMDs office is across the street and your people are leaving. In Folsom they have opened another office across the street. See why people are leave and fix loosing your top SOC designers.

I’m not in favor of layoffs, to help reducing headcount first open VSP for people who want to retire.

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Intel openly classifies “high performers” as bloviators, thieves, backstabbers, cousins and wives. Therefore, layoffs and pay cuts targeting low performers actually makes things worse.

I think its wrong to always think that institutional knowledge walking out is a bad thing. Sometimes we are encumbered by ourselves and our past. Sometimes these older processes are what are chaining us. So some of it which may have worked in past walks out, I dont think its a bad thing.

We need more optimists and folks who want to approach the problem in a new way and take risks. And while its cliche to say fail fast, we must be able to fail fast and take risks.

Every employee thinks he is a high performer. Most managers like braggers, friends, and pets. They don't know what high performance is since they are not paid for consequences. So OP's approach will only make the wrong people get paid a lot and accelerates the exodus.

Problem with higher pay for high performers it these are chosen by direct management and +1, on occasion +2. Usually using the buddy system.

Intel just needs to clean house, from ELT and down.
Simplify the management structure. This will require CEO to pay attention to the business and not his world wide company paid vacation.

Maybe ELT does not want to cut themselves if you target incompetence

I agree it is too late!

You can cut employees and boost the pay of those that you want but the company as a whole is going to be uncompetitive given scale and product.

Barring a conflict escalation in far east Intel is finished

It is 100% poor management.

Too late.

A lot of institutional knowledge has walked out the door and will NEVER come back.

It takes decades to replace those kinds of people. People that really move the needle.

Rebuilding is hard as Intel’s brand is irreversibly damaged. Ask young people where they want to work. It ain’t Intel.

Even with competitive pay, there’s no growth and nobody wants to work in a no growth environment. It leads to zero sum mentality.

Management is also quite incompetent.

The pay stuff is no brainer. Many high performing employees are just going to be demoralized with the pay cut. They should have done the necessary to find the low performing employee and cut them to save cost rather than an easy button of reducing blanket pay.

10 high performing over achieving employees are much better than 15 average employees with a paycut.

Thread regarding Intel Corp. layoffs

Friendly recommendations from investor point of view to fix intel

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