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Technology Stocks : Rambus (RMBS) - Eagle or Penguin
RMBS 95.26+3.1%Nov 14 9:30 AM EST

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To: Don Green who wrote (41061)4/28/2000 4:42:00 AM
From: Bilow  Read Replies (2) of 93625
 
Hi Don Green; <<<Begin FUD warning!!! Re the Intel reorg, from zdnet article and also Intel's press room:
intel.com

In a dramatic move to address some of the problems that have plagued the company over the last year, Intel Corp. is undergoing a major reorganization,
...
With the reorganization, Gelsinger assumes the title of chief technology officer and will oversee product implementations across all business groups.
zdnet.com

A lot of us engineers have been saying that Intel's problems resulted from Intel's management directing engineers to do less than optimal things, for non-engineering reasons. Most of those silly decisions were made in the desktop group. Gelsinger was general manager of that group:
techweb.com
General manager of something that size is a big responsibility. A lot of people report to you, and you have a budget that is incredibly huge. You have the ability to change the course of technology. To order the memory makers to produce overly expensive memory chips, for instance...

The reorganization is to address problems that Intel has had over the past year. Most of those problems have been in the desktop group. Would it make sense that Intel would promote the guy responsible for that group, or that they would demote him? Did they promote him or demote him? A position like "chief technology officer" is not a position in the management chain of command. CTOs have responsibilities, but it is the general managers that make the decisions. And firing a general manager just isn't done at such high levels. Instead, you put him into a position where he can't do any more damage, and then let him find another job, and leave "for personal reasons."

The reason you have to get rid of the managers that were responsible for making wrong decisions is that humans have extreme difficulty admitting they are wrong. Those of us who trade a lot eventually learn that the best thing to do is to admit the error (sell the loser) right away, before it can make a big equity hole. But management at large companies can be amazingly insulated from the kind of feedback that the market provides. People who report to upper managers don't like to give them bad news. So if it is possible to believe, for instance, that the engineers might get the Camino ready for the September delivery, then the message that is passed to management is that the Camino will probably be ready. The poor guy then goes out to the press (and to the CEO) and tells them that everything is on schedule. Everybody shades the truth of everything they say to him, and shades it in such a way as to make him feel good about himself, and to therefore feel good about the bringer of news. This is the ancient problem of powerful people, the "emperor's new clothes" syndrome. Nobody wants to tell you the truth, if it hurts. So management will continue on with a bad move long after the rest of the world has noticed that something isn't right.

When one bad thing or another happened, (for instance the Camino delay), Gelsinger was the one who had to tell it to the press. It is also traditional in upper management to force the guy who screwed up (or the guy who they have decided will take the blame) to talk to the press about it.

My interpretation of the management moves at Intel is that the main supporter of Rambus at the company, has been demoted.

end FUD warning!!!>>>

-- Carl
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