Andy Grove of Intel: Entrepreneur Turned Executive Essay

Andy Grove of Intel: Entrepreneur Turned Executive Essay

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Andy Grove of Intel: Entrepreneur Turned Executive Essay

Case Number 39

Andy Grove of Intel: Entrepreneur Turned Executive

Andy Grove, one of the three founders of Intel Corporation, was asked three questions by Peter F. Drucker in a 1986 interview. The three questions appear below along with Dr. Grove’s responses.

QUESTION 1

If there were one thing to tell a young man or woman who starts out with their own new business and wants to build it, what is the one absolutely essential thing you would tell them?

 

If I had one shot at getting something into a person’s mind or heart in this situation, it would be the concept of submerging their own self and putting it behind the interests of the enterprise. They should not put themselves ahead of the enterprise. And I can’t say that emphatically enough. Whatever problems I have seen all come from people wanting to succeed personally, wanting to be right personally, wanting to win an argument personally, wanting an organization change to propel them ahead personally, without considering what impact that desire or that change has on the organization.

Particularly when you are in the small boat with a number of other people—close proximity and pressures are high and tension is high. Getting into the people’s mind that you won’t get there any faster by positioning yourself at the bow of the boat; you’ll only get there faster if you row faster and move the boat forward. If you can get this into the founding people’s hearts and minds, you have won automatically the majority of the battles that will come up.

The only thing that matters is the enterprise. You cannot succeed if the enterprise does not succeed. And if the enterprise succeeds, there will be enough success to go around and you’ll get your share. So, my admonishment to any person in that situation is, Don’t put your ego ahead of the enterprise, because you will lose. What is right matters, not who is right.

QUESTION 2

What did you have to learn to do and what did you have to learn not to do at the beginning, when the three of you sat down and began to build the company and the business? And then how did this change once the company was successful and very large?

 

The job [initially] was very simple conceptually. You needed to do a certain number of things today, a certain number of things tomorrow, and a certain number of things by the end of the month. And unlike in a company like Intel today, where we are very preoccupied with the process of how to do things, we knew what to do and somebody went and did it.

This lack of interest in the process of how you are doing things started to give way to more thought to the [formal] process maybe about three years into the life of the company. For the first three years, there was no game plan; people just did things that they were naturally attracted to, and very rarely did they collide. We only hired people with very specific skills; there was no training involved. We were concerned with people right from the very beginning of the company. The nature of the concern was very heavily skills-oriented and task-oriented, rather than process-oriented or training-oriented or structure-oriented.

Now, seventeen years later, my personal behavior is substantially different because the company is substantially bigger, more complex, and because I am seventeen years older.

The content of what I do now is substantially different. Seventeen years ago I was buying equipment myself, running experiments, and reducing the data. I was one step away from silicon wafers and stuff like that at the time. Today, I am many steps away from that. Today, I deal with abstractions but still with people. People have been a constant.

I began with an instinctive way of how to hire, manage, and communicate with a person. Then, I remember two milestones. Intel started in 1968. We became aware of a growing need for some kind of a formal training process in 1971. The way that came about is that the person who headed our manufacturing organization had a series of lunches with the production operators and asked them what their concerns were. After three or four lunches, he was absolutely astounded—he was expecting to hear complaints about it being too hot or cold, or perhaps that they wanted music piped in as they worked. But the predominant complaint that came up during these lunches was that they were not being trained for their jobs. So, the impetus for formal training at Intel goes back to these lunches. And that was not in my intuition. We went around to institute the beginnings of a very sophisticated training program for operators. And then the question came up, “Should we not do this for managers also?”

In 1973, supervisors were saying, “you want us to do performance assessments and other duties; show us how to do them.” The demand for additional training, management training this time, began again. I was forced to rethink the intuitive techniques that we had started several years earlier.

I went through a gradual process. Things became more complex. You go into a new company with everything in your head. I went through a gradual realization; a shifting of tasks took place gradually. The picture of my own role emerged relatively early. I was the organizer and taskmaster. People in the initial group almost immediately gravitated to roles that fit them. The team built itself up almost. Roles that were needed gravitated to appropriate team members.

If you don’t think through the roles of the key people very early, you build up tribes and power struggles in the organization, which in the early stages has to be deadly. New people, subordinates, had a different way of operating than me. I had some real conflict with those individuals. They were not reaching for roles and colliding with the initial group but had a different way of operating. As a result of insisting that their way of operating prevail and by trying to exert power with the others, we were led to a power struggle—a struggle that resulted in our wasting substantial emotional energy. It was a very early introduction to the responsibilities that I had to deal with, responsibilities I did not want to deal with but had no choice.

The initial group was very willing to make changes with a little bit of friction and a little bit of debate. Most of us had hungry minds, the minds of a student, and the notion of getting into a new area had more attraction than imposing your views in an old area. And for the same reason we did not resist going out to the customer.

My role was not so much as “going out” rather as being “major domo” for people “coming in.” And that started relatively early. Here is a self-respecting semiconductor-device person [me] setting up tools for representatives of major corporations whose biggest concerns at that time were not technical but had to do with the viability of Intel as a company. I started doing this work almost immediately. Our industry had promised all kinds of things that it had not delivered upon. So, we had a very skeptical customer base. So, we adopted as a corporate logo Intel Delivers.

QUESTION 3

How did you go about developing yourself?

 

I get my nose into a new activity; I spend some amount of time on it. I find that I put pressure on my time. At some point, I find that something has to go. I begin to scan what I do. I look for opportunities. I look for activities that I participate in that I could stop participating in. For most of the things that have to go I can find some substitute arrangement. For example, I changed our management meeting from once each week to one each two weeks.

In every case, the pressure is around time. I ask, “What am I doing that I shouldn’t be doing?” I force myself to get overloaded, and then I look at the whole stack for something to throw out.

I look at what I do. Should I still be doing it? Am I doing it well? Am I adding enough value to what I am doing? Is it more worthwhile or less worthwhile than something else? I negotiate with myself. Perhaps what happens is that I won’t immediately stop something but I start the machinery to stop within a certain period of time, such as six months.

QUESTIONS

What did Andy Grove do right as an entrepreneur? How about as an executive once Intel grew into a complex company? What lessons do you take away from Andy Grove’s experiences as a cofounder and president of Intel Corporation?

 

RUBRIC QUALITY OF RESPONSE NO RESPONSE POOR / UNSATISFACTORY SATISFACTORY GOOD EXCELLENT Content (worth a maximum of 50% of the total points) Zero points:  Student failed to submit the final paper. 20 points out of 50:  The essay illustrates poor understanding of the relevant material by failing to address or incorrectly addressing the relevant content; failing to identify or inaccurately explaining/defining key concepts/ideas; ignoring or incorrectly explaining key points/claims and the reasoning behind them; and/or incorrectly or inappropriately using terminology; and elements of the response are lacking. 30 points out of 50:  The essay illustrates a rudimentary understanding of the relevant material by mentioning but not full explaining the relevant content; identifying some of the key concepts/ideas though failing to fully or accurately explain many of them; using terminology, though sometimes inaccurately or inappropriately; and/or incorporating some key claims/points but failing to explain the reasoning behind them or doing so inaccurately.  Elements of the required response may also be lacking. 40 points out of 50:  The essay illustrates solid understanding of the relevant material by correctly addressing most of the relevant content; identifying and explaining most of the key concepts/ideas; using correct terminology; explaining the reasoning behind most of the key points/claims; and/or where necessary or useful, substantiating some points with accurate examples.  The answer is complete. 50 points:  The essay illustrates exemplary understanding of the relevant material by thoroughly and correctly addressing the relevant content; identifying and explaining all of the key concepts/ideas; using correct terminology explaining the reasoning behind key points/claims and substantiating, as necessary/useful, points with several accurate and illuminating examples.  No aspects of the required answer are missing. 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