Intel’s commitment to a company culture that promotes employee empowerment has made the tech giant one of the most profitable companies in the world today. Intel’s open door policies and cultivating of the best and brightest employees in a positive environment promotes a healthy and positive corporate culture.
In this weeks reading, I came across an article “Intel CEO Otellini on Successful Company Culture” by Rich Karlgaard. This article was a brief interview with the current CEO, Paul Otellini about how Intel has been able to successfully manage CEO succession over the past 44 years due to its corporate culture.
How does Intel create their company’s culture? In this weeks reading, “Toward a Theory of Organizational Culture and Effectiveness”, by Daniel R. Denison, Aneil K. Mishra. They talked about the CEO of Chemical Bank, Ben Love who was thought of in high regard by his employees. “The culture of the bank reflects an interesting paradox: Leadership comes from the top down and respect for that authority is high. It is virtually impossible to talk about the culture of the bank without the discussion focusing on Ben Love. (Denison, D.R. & Mishra, A.K.) . During my second year at Intel as part of Intel’s Sales and Marketing Rotation Program, our group (15 people) had a unique opportunity to sit down with the legendary Intel CEO, Andy Grove for 30 mins to talk “Big Picture”. The group discussion covered many topics ranging from the future of the company, to competing with AMD, to work life balance. Mr. Grove wanted the group to ask him as many questions as possible, which was a little intimidating since this is the man who help to create the micro-processor. However, I did ask Andy Grove a question. I asked, “Dr. Grove, knowing what you know, if you could go back in time, is there anything you would do differently today?”. Mr. Grove quickly responded and said “I wish I did not have to lay off the top talent during tough economic conditions. The loss of top talent is a great loss and sometime irreplaceable.” That answer still resonates with me to this day, for one, Andy Grove answered my question, and secondly it spoke to how much Intel values its employees. In the article, one of the many questions posed to Mr. Otellini was “What hasn’t changed in Intel’s culture?”. Mr. Otellini’s response, “The commitment to deep science and engineering… Half of our 82,000 employees today have engineering degrees and a quarter have masters degrees. We have 4,000 Ph.D.s, more than most universities in the world.” (Karlgaard). Also from the article, Mr. Otellini was asked, “How would you summarize the Intel culture?” “Egalitarian. Merit based. Anyone can speak in a meeting, but you must speak with data. Take risks. Embrace innovation, but do it with discipline. That’s Grove. World-class manufacturing... “The other thing unique to Intel, at least in Silicon Valley, is the mix of older and newer employees. Intel has more 20-year-plus veterans than any Silicon Valley company. I’ve been here 36 years. Yet the average age of our global workforce is 25. Tradition and innovation. We like both.” (Karlgaard, R)
Therefore, Intel is able to stay competitive in today’s business environment by treating its employee’s well, and having an open environment were employees feel empowered and feel that their voice is heard. Many companies in the Silicon Valley should use Intel as a blue print and learn from the leaders of Intel on how to have a positive corporate environment.
Reference:
Karlgaard, R. (2011). Intel CEO Otellini on Successful Company Culture.
Forbes, Tech. Retrieved from
http://www.forbes.com/sites/richkarlgaard/2011/02/16/intel-ceo-otellini-on-successful-company-culture/2/
Denison, D.R. & Mishra, A.K. (1995) Toward a theory of organizational culture and effectiveness. Organization Science, 6, 204-223.
Damu, how great that you had the opportunity to sit down for a face-to-face meeting with Andy Grove. That must have been a very interesting experience. You provide some good examples of the strong culture at Intel. In general, strong cultures are positively related to organizational performance. However, Sorensen notes that "strong cultures may be a liability in volatile, rapidly changing environments." Some might say that Intel is operating in a environment that is characterized by such rapid change. Why do you think that their strong culture has been an asset, rather than a liability?
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ReplyDeleteTo answer your question, “Why do you think that their strong culture has been an asset, rather than a liability?”. Intel’s environment is an open environment rather than a resreticitive environment, which leads to employee morale being rather high. Some examples of what keeps morale high at Intel are some of the perks working at the company. Google is known for the their daily free lunches, on campus daycare, and all sorts of other activities to keep employees motivated and happy. Intel also as some “very cool” perks, such as the Intel jet, which most employees can use to fly between campuses. The perk that everyone likes is the mandatory paid 6-month sabbatical after every 7 years work. Having a strong internal culture is critical to organizational effectiveness.
You also noted, “Sorensen notes that "strong cultures may be a liability in volatile, rapidly changing environments.”" The process landscape is not a rapidly changing environment. Also, Intel is head and shoulders above all its competition. AMD, which is Intel’s main rival, isn’t even on the map with the products it has to offer to compete with Intel. Actually, on of the biggest problems Intel faced was how to stay sharp and not get over confident.
BTW, sitting in a group meeting F2F with Any Grove is one of my top five moments I've had in my business experiences. Andy is truly a visionary.
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