Andy Bryant, executive vice president, technology, manufacturing and enterprise services and chief administrative officer, Intel“No one does it alone anymore, not even Intel.” In one of his closing lines from his keynote address on Wednesday, Andy Bryant, executive vice president, technology, manufacturing and enterprise services and chief administrative officer for Intel, explained that although consolidation has positioned the industry behemoth ahead of competitors, the company still needs to be agile and aware of what’s happening in the market and with competitors. Bryant, who has worked at Intel under four different CEOs, including the legendary and colorful Andy Grove, revealed some of the thinking that goes on there.
Bryant repeatedly emphasized the importance Intel places on technology and innovation and how if as a company you’re not innovating, you’re falling behind. The recent recession was a precarious time for the industry and was the wrong time to cut back on innovation, Bryant said. “You don’t save your way out of a recession.” He stressed how important it is to come out every year with better technical products and features. “If you’re not innovating, you’re falling behind.”
Bryant shared the company’s investment mandate:
- It is not enough to survive.
- We must move ahead and continue to thrive.
- We do this through efficiencies and continued investments in valuable technologies and people.
The company achieves this, Bryant said, by moving technology forward and adapting to the constantly changing business models, like several years back when gigahertz took a back seat to power consumption.
A key tool that has helped Intel remain agile during volatile times is supply chain excellence. The company was able to reduce its fab cycle time by 65%, which made it able to react more quickly to market fluctuations. Bryant said Intel increased its response time to customers by a factor of 3×, which made changing or canceling orders much more realistic. By reducing its inventory, the company was also able to not have as much capital tied up in finished product.
Other tips Bryant offered in down times were to attack non-essential spending and to proceed with investments that make the company more competitive. “Having money doesn’t get you a solution,” Bryant said. “Many of Intel’s businesses failed, I think, because they were given too much money.” If they were given a tight budget and forced to innovate, chances are they might have succeeded.
Bryant admitted the major costs involved with having a factory and said a company needs about $10 billion in revenue per leading-edge fab it supports. This obviously limits the number of players in the industry, especially since R&D continues to grow in expense as well as a percentage of a company’s revenue. The integrated model, however, works for Intel, and Bryant said it’s because everybody works for the same owner, there is a more thorough transfer of knowledge, and there is more agility under that model. This leaves smaller players left with collaborative efforts, a practice Bryant fully supports. “With more companies seeking to collaborate and integrate,” he said, “value flows back and forth through market segments.”
To clarify, Bryant said that the industry itself isn’t consolidating as an industry, but the businesses within it are. Regardless, opportunities for growth remain significant, with potential gains in the automotive, government and healthcare industries, he said.
“Growth is going to continue,” Bryant said. “The question is, how are we going to adapt to it?”
— Arthur Patterson, SEMICON West Daily News