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Intel CEO Grove Speaks About Industry Changes

By Christopher L. Falling
Staff Reporter

On Wednesday, Andrew S. Grove, president and CEO of Intel Corporation, spoke in the fifth lecture of the Industry Leaders in Technology and Management seminar series.

The School of Engineering and Sloan School of Management are sponsoring the series in conjunction with the Center for Technology, Policy, and Industrial Development. The series will bring to MIT leading CEOs who have distinguished themselves in endeavors involving technology and management.

The lecture, titled "Exploiting the Crisis Points: Challenging Every Company and Career," was held in a full Wong Auditorium in the Tang Center. An overflow room was quickly filled with a standing room only crowd.

Grove discusses major changes

Grove talked for most of his lecture about "strategic inflection points." These points are fundamental changes in a business or industry. Grove also addresses these inflection points in his new book, Only the Paranoid Survive.

An example of a strategic inflection point would include a Walmart moving into a small town and forcing the local retailers to change the fundamental nature of their business, Grove said.

A larger-scale example is the development of the personal computer, an event that changed not just one company or town but forced many industries to reinvent themselves.

In a business, a strategic inflection point may be something that is largely unnoticed by senior management but may cause front-line employees to start behaving differently, Grove said.

"A sign that the Internet is resulting in a [strategic inflection point] is that the original people involved in the Internet found a large influx of people who had no business being in the Internet," Grove said.

After describing strategic inflection points, Grove examined strategies that can be used to deal with them. "Every right decision I have made has been made at least a year late," he said.

Grove divided the process of dealing with fundamental changes into two different phases: one where chaos can reign and one where one reigns in chaos. These different phases will require different management strategies, Grove said.

Individuals in control of careers

Grove also applied his analysis to individuals. Since companies are no longer guaranteed a lifelong existence, they can not afford to give lifelong employment, he said. Because of this, every individual is the owner of his own career.

During the question and answer section of the lecture, Grove spoke of Intel's next strategic inflection point - that of communication-based applications. The spread of such applications will result in increased demand for computing power and thus more business for Intel, Grove said.

"Intel cannot really grow by increasing market share, so [we are] trying to expand the entire industry," Grove said, citing that most of the development that Intel has is in diversifying its technology.

3M CEO to speak

Levio Desimone, the CEO of 3M will be speaking on Dec. 3 and will be last lecture of this term. However, the speaker series is ongoing, said Donna Carty, the program manager for the Center for Technology, Policy and Industrial Development.

"We don't have anyone booked after Desimone, but our goal is to have one lecture a month during the term," Carty said. "The series is limited to chairmen and CEOs of major corporations but we are looking for student input of who to invite."

Jack Smith, CEO of GM spoke last week at the fourth lecture of the series. Alex Trotman of Ford Motor Company, Gordon Binder of the biotechnology firm Amgen, and Jorma Olliva of Nokia, a cellular phone and consumer electronics company, spoke in the first three lectures of the series last year.