Even after leaving Intel in 2009, Pat Gelsinger kept talking about the company he had been working for since his teenage years.
When asked about Intel, he will tell the audience how his mentor and former Intel CEO Andy Grove shaped him. Now, Gelsinger, who has returned to Intel, has the opportunity to re-establish a leadership style that once led Intel to become the overlord of chip manufacturing. At the same time, he also brought lessons learned from other places to Intel, helping the company from at least 10 years Recovery from the biggest crisis.
Bloomberg pointed out that the 59-year-old Gelsinger joined again because Intel faces better competitors and companies that were once its own customers but also entered the field. The main challenge he faced was to solve Intel’s manufacturing problems, which former CEOs Bob Swan and Brian Krzanich failed to achieve.
Unlike Swan, Gelsinger has technical know-how and extensive internal governance experience, which he needs to reverse the situation at Intel. As a former chip designer, Gelsinger understands the complex engineering of Intel products. As the former CEO of VMware, he embraced the cloud computing boom, which is reshaping Intel's most important market.
Raymond James & Associates analyst Chris Caso said that Gelsinger is the darling of investors, and in our conversation, he is also Intel’s most desired next CEO. He is also an outsider-from a much smaller and more flexible organization that has successfully created a new ecosystem and a set of industry standards in the past few decades, has many basic innovations, and is also a An Intel veteran.
Around 2006, Gelsinger was a leading technician, communicating Intel’s new strategy to the market faster than ever before, that is, bringing chip designs or updated manufacturing technologies to the market every year. This demand is imminent, because AMD is catching up, occupying a quarter of the lucrative server chip market, compared to almost zero a few years ago.
At that time, Gelsinger called this new and ruthless technological update rhythm "Tick Tock". This strategy worked. A few years later, AMD's share of the server chip market returned to less than 1%.
In 1979, when he was only 18 years old, he joined Intel just after graduating from the technical college. While studying for a higher degree part-time at Stanford University, he continued to design part of Intel's most important chip 8086. It was during his tenure as Intel's first chief technology officer that he became famous as a genius evangelist of company innovation and vision of the direction of computer technology development.
People familiar with Andy Grove's style say that, like Grove, when Gelsinger feels that his subordinates are trying to avoid questions or fail to answer questions honestly, he also reprimands them in a daunting voice. He will also take time to communicate with employees at all levels who come to him for advice.
Gelsinger made the same fair judgment about his career. After leaving Intel, he often pointed out that the technical decisions he made during his tenure were wrong, and told others that he would be fired when he was clearly not suitable for the highest position.
After leaving Intel in 2009, Gelsinger joined EMC, a data storage provider, as one of the candidates to succeed CEO Joe Tucci, who was planning to retire. Instead, Tucci chose to stay, and Gelsinger eventually became VMware's CEO, when EMC held a majority stake in VMware. When Dell acquired EMC, it also acquired the latter's ownership of VMware.
At VMware, Gelsinger faces a double challenge. The market for VMware's products has matured. At the same time, through a series of reorganizations, the relationship between the company and Dell is also changing.
In order to boost the company's performance, Gelsinger proposed several strategies and finally finalized a plan to closely integrate his company with Amazon's cloud services. Amazon is working with VMware to win customers who want to run applications on the cloud, while letting their corporate data centers run with VMware software.
During the first phase of Gelsinger's tenure, VMware's stock price plummeted, but since the beginning of 2016, with the recovery of revenue growth, VMware's stock price has begun to soar.
Bloomberg pointed out that regaining the trust of leading cloud service providers such as Amazon and Google will be a key task for Intel CEO. These companies are among the largest buyers of Intel server chips, but they are increasingly designing their own chips and producing them elsewhere. Intel’s squeezing toothpaste-style updates and iterations also contributed to such changes.
However, Gelsinger's biggest challenge will be to determine the future of Intel manufacturing. When he left, Intel's factory had the most advanced production capacity in the industry by closely integrating internal design with the new manufacturing process. Now, the company has fallen behind TSMC. TSMC does not design its own chips, but produces chips for most of Intel's competitors.
The outgoing CEO Swan is considering more production outsourcing as a backup plan, while Intel is trying to regain its leadership through its own production. Intel’s other leaders believe that chip design technology has undergone permanent changes, and a hybrid approach of doing some work internally and externally is the right way forward.
Gelsinger needs to clarify this confusing information, which has left customers and investors confused and doubtful about Intel's development direction. Last year, despite the surge in most chip stocks, Intel's stock price fell by 17%.