Keep your opportunity assessment breathing: Analyzing Intel’s growth strategy over time
- Case studies
The Market Opportunity Navigator is an excellent tool to manage the on-going evaluation process and continuously update your opportunity assessment. To demonstrate this, we analyze the attractiveness of Intel’s growth opportunity and how it evolved over time.
Strategy in times of uncertainty
The business world is experiencing a challenging period: Going out of the hyper-growth market that was fueled with “cheap” money to avert the COVID-19 crisis, we are moving back to “old territories” of significant interest rates and cost of money. The last time the world has gone through such a financial shake-up was back in 2008, and it is still unclear whether the current period will be harsher or not.
One thing is clear though: if you need to set a strategy in times of uncertainty, it is critical to continuously and methodologically assess the attractiveness of your opportunities – so you can decide if it’s time to adapt, abandon or continue their pursuit.
The Market Opportunity Navigator is an excellent tool to keep your opportunity assessment breathing and manage the on-going evaluation process. The structured framework allows you to trace back your prior evaluation, bring in new data, and revise your assessment – and your strategy – if required.
The case of Intel’s foundry business
Intel is facing a pivotal moment in its existence. It is no longer the biggest semiconductor chip company: its direct competitor AMD is now equally big in value, and companies are abandoning Intel to develop their own solutions that previously were too complex to explore (Apple leading the tide). In addition, Intel is no longer the leader in manufacturing capabilities, losing that race to Taiwanese TSMC, the world’s biggest semiconductor manufacturer.
The COVID-19 market disruption coupled all of the above with massive consumption and extensive shortage of chip supply world wide. It also emphasized the United State’s dependency on external manufacturers – in a delicate geopolitical situation, which led the US administration to initiate programs that can minimize this dependency.
Intel’s 2021 newly appointed CEO, Pat Gelsinger, identified this as an opportunity for Intel to change its tide. Mr. Gelsinger decided to provide foundry services to fabless companies – for the first time in Intel’s history, and to build – with the support of the US government – massive manufacturing facilities in the US.
How attractive is this opportunity? A 2021 analysis
Applying Worksheet 2 of the Market Opportunity Navigator to assess the attractiveness of this growth engine for Intel, it seemed to be a Gold-Mine opportunity, bearing high potential and manageable challenges.
Here is a quick analysis of this opportunity according to the conditions in 2021:
Is this opportunity still attractive? A current analysis
Time has passed and A LOT has changed as we are leaning toward 2023. Is this opportunity still attractive today for Intel? Should they stick with it? We can examine the major changes through the revised Worksheet 2.
It seems that the overall potential has decreased while the overall challenge has increased, shifting this opportunity towards the Moon-Shot quadrant of the Attractiveness Map.
The power of an ongoing assessment
While we do our best to make informed strategic decisions for our company, we still don’t have a crystal ball that can tell us the future.
As the business environment is constantly changing, revisiting the assessment of opportunities in a systematic manner allows us to better understand our dynamic playground and make ongoing decisions in a timely manner.
As for Intel, they currently decided to continue building their manufacturing capacities in the US, yet they would need to better gauge this opportunity to cope with the risks involved. Time would say if this long term strategy would turn the tide for Intel.