MME30001

ENGINEERING MANAGEMENT 1

Assignment 1: Research Project Report

Prepared By:
Muhammad Hasan Tariq (4327608)
Isaac Mering Ating (100063249)
Tay Guan Yu (4317157)
Alexander Soon Ghim Kion (4321111)
Javan Liew San Jer (4317114)

Research Group Project: 12

Tutorial Group: 3

Lecturer/Tutor:
Ms. Tan Yiing Chee
Ms. Wong Din Wen
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Executive Summary
This report was written to evaluate, analyse and compare the management aspects of two
organisations Intel and AMD. The report provide an in-depth and thorough research of the
culture and working style of the organisations and their decisions and strategies.
The environmental factors of each organisation is analysed using the PEST analysis. This is
followed by the contributions of these companies towards sustainability and how the ethical
issues and social responsibilities were considered by the organisations. In addition, Porters
five forces and SWOT analysis were used to further understand the environmental factors and
gives a current status of the companies. Furthermore, problems, decisions and decision making
style of the two organisations were compared. The analytical comparisons were also made
throughout the report for the companies. The report ends with recommendations and
conclusion of these two organisations.

Contents
1.0 BACKGROUND ................................................................................................................. 1
1.1 Intel................................................................................................................................... 1
1.1.1 Introduction ............................................................................................................... 1
1.1.2 History ....................................................................................................................... 1
1.2 Advanced Micro Devices (AMD) .................................................................................... 3
1.2.1 Introduction ............................................................................................................... 3
1.2.2 History ....................................................................................................................... 3
2.0 ENVIRONMENTAL FACTORS ........................................................................................ 5
2.1 Intel................................................................................................................................... 5
2.1.1 Internal environment.................................................................................................. 5
2.1.2 External Environment ................................................................................................ 6
2.2 Advanced Micro Devices (AMD) .................................................................................... 8
2.2.1 Internal Environment ................................................................................................. 8
2.2.2 External Environment ................................................................................................ 9
2.3 Intel vs. AMD................................................................................................................. 10
3.0 Sustainability...................................................................................................................... 10
3.1 Intel................................................................................................................................. 10
3.1.1 Environmental Sustainability .................................................................................. 10
3.1.2 Business sustainability............................................................................................. 12
3.2 Advanced Micro Devices (AMD) .................................................................................. 12
3.2.1 Environmental Sustainability .................................................................................. 12
3.2.2 Business Sustainability ............................................................................................ 13
3.3 Intel vs. AMD................................................................................................................. 14
4.0 Ethical Issues ..................................................................................................................... 14
4.1.1 Code of Conduct ...................................................................................................... 14
4.1.2 Misconducts ............................................................................................................. 14
4.1.3 Atonement ............................................................................................................... 16

4.2 Advanced Micro Devices (AMD) .................................................................................. 16

4.2.1 Code of Conduct ...................................................................................................... 16
4.2.2 Misconducts ............................................................................................................. 17
4.2.3 Atonement ............................................................................................................... 17
4.3 Intel vs. AMD................................................................................................................. 17
5.0 Social Responsibility ......................................................................................................... 18
5.1 Intel................................................................................................................................. 18
5.1.1 Education ................................................................................................................. 18
5.1.2 Social ....................................................................................................................... 18
5.1.3 Environment ............................................................................................................ 18
5.1.4 Health....................................................................................................................... 18
5.2 Advanced Micro Devices (AMD) .................................................................................. 19
5.2.1 AMD Foundation ..................................................................................................... 19
5.2.2 Education ................................................................................................................. 19
5.2.3 Social ....................................................................................................................... 19
5.2.4 Environment ............................................................................................................ 19
5.2.5 Health....................................................................................................................... 20
5.3 Intel vs. AMD................................................................................................................. 20
6.0 SWOT ANALYSIS ........................................................................................................... 20
6.1 Intel................................................................................................................................. 20
6.1.1 Strength .................................................................................................................... 20
6.1.2 Weakness ................................................................................................................. 21
6.1.3 Opportunities ........................................................................................................... 21
6.1.4 Threats ..................................................................................................................... 22
6.2 AMD............................................................................................................................... 22
6.2.1 Strength .................................................................................................................... 22
6.2.2 WEAKNESS ........................................................................................................... 23
6.2.3 Opportunities ........................................................................................................... 24
6.2.4 Threats ..................................................................................................................... 24
6.3 Intel vs. AMD................................................................................................................. 24

7.0 PORTERS FIVE FORCES ............................................................................................... 25

7.1 Intel................................................................................................................................. 25
7.1.1 Threat of New Entrants............................................................................................ 25
7.1.2 Threat of Substitutes ................................................................................................ 25
7.1.3 Bargaining Power of Buyers.................................................................................... 25
7.1.4 Bargaining Power of Suppliers ................................................................................ 25
7.1.5 Current Rivalry ........................................................................................................ 25
7.2 AMD............................................................................................................................... 26
7.2.1 Threat of New Entrants............................................................................................ 26
7.2.2 Threat of Substitutes ................................................................................................ 26
7.2.3 Bargaining Power of Buyers.................................................................................... 26
7.2.4 Bargaining Power of Suppliers ................................................................................ 26
7.2.5 Current Rivalry ........................................................................................................ 27
7.3 Intel vs. AMD................................................................................................................. 27
8.0 PROBLEMS ...................................................................................................................... 27
8.1 Well-Structured Problems .............................................................................................. 27
8.1.1 Intel .......................................................................................................................... 27
8.1.2 AMD ........................................................................................................................ 27
8.2 Unstructured problems ................................................................................................... 28
8.2.1 Intel .......................................................................................................................... 28
8.2.2 AMD ........................................................................................................................ 28
8.3 Intel vs. AMD................................................................................................................. 28
9.0 DECISIONS ....................................................................................................................... 29
9.1 Intel................................................................................................................................. 29
9.1.1 Policies..................................................................................................................... 29
9.1.2 Procedures ............................................................................................................... 29
9.2 AMD............................................................................................................................... 30
4.2.1 Policies..................................................................................................................... 30
9.2.2 Procedures ............................................................................................................... 31
9.3 Intel vs. AMD................................................................................................................. 31

10.0 DECISION MAKING STYLE ........................................................................................ 32

10.1 INTEL .......................................................................................................................... 32
10.1.1 Right decisions ...................................................................................................... 32
10.1.2 Wrong decision- .................................................................................................... 33
10.2 AMD............................................................................................................................. 33
10.2.1 Right Decisions...................................................................................................... 34
10.2.2 Wrong decisions .................................................................................................... 34
10.2 Intel vs. AMD............................................................................................................... 35
10.3 Characteristics of Good and Bad Decision-making Process ........................................ 36
11.0 RECOMMENDATIONS ................................................................................................. 37
11.1 AMD............................................................................................................................. 37
11.2 INTEL .......................................................................................................................... 37
12.0 CONCLUSION ................................................................................................................ 38
13.0 REFERENCES ................................................................................................................ 39
14.0 APPENDICES ................................................................................................................. 46
MEETING TEMPLATE .......................................................................................................... 46

1.0 BACKGROUND
1.1 Intel
1.1.1 Introduction
Intel is a multinational technology company with its headquarter in Santa Clara,
California. Based on its revenue, it is the biggest and highest valued semiconductor chip
maker. Founded by Gordon Moore and Robert Noyce, Intel as of today produces CPUs
(Central Processing Unit), network controllers and flash memory such as solid-state
drives (SSD). Brian Krzanich is the current CEO with Andy Bryant as the chairman.
Intel had 107,300 employees as of 2015 (Intel 2015).
Its main competitor as of today is AMD on the CPU side and Broadcom on the network
side. On the NAND flash based storage (SSD) side Intel competitors include Samsung,
Toshiba, SK Hynix, and STMicroelectronics.
Intels line of CPUs as of today includes the Pentium for lower end computing and the
Core series of CPUs with the iconic i3, i5 and i7. Intel also produces tablet and phone
processors with their Atom line. For the server and workstation, Intel offers the Xeon
brand. Intel is currently in the works with their new architecture Kaby Lake, which will
succeed the current Skylake CPUs.
The company also sells SSDs such as the 750 series line. These come in SATA interface
and also the more powerful NVMe SSDs using the PCIe interface.
Based on the Q1 2016 reports, Intels revenue is at $13.7 billion with a total estimated
assets of around $103 billion.

1.1.2 History
Intel was founded by July 18, 1968 by Gordon Moore, a chemist and Robert Noyce, a
physicist credited for co-inventing the integrated circuit. Both have left Fairchild
Semiconductor halfway throughout their career after co-founding it to establish NM
Electronics. The name Moore Noyce was dropped as the namesake of the new company
as it is sounds similar to more noise (Interview with Moore). The two eventually came
up with the name Intel, but had to buy the rights to it from the hotel chain Intelco due
to trademark issues.
Intel rolled out its first product, the 3101 Schottky bipolar random access memory
(RAM) in 1969 (Intel Timeline: A History of Innovation). The ones Intel made were
nearly twice as fast as the ones manufactured by Fairchild Semiconductors and the
Japanese, Electro technical Laboratory. Intel introduced Intel 1101, a metal-oxide
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semiconductor (MOS) in 1969. In 1970 the company introduces the 1103 with a 1
kilobyte DRAM, the first of its kind to hold, at the time, that large amount of
information (Intel Corporation History).
After gaining another 2 million USD in 1971, the company went public. The same year
also marked a significant history of the timeline at Intel as they debuted the Intel 4004,
the first commercially available microprocessor. Similar to many of Intels innovations,
the 4004 is a by-product of helping the Japanese calculator manufacturer Busicom to
design cost-effective chips for their calculator. The result was a microprocessor that can
handle 4-bit instructions and a maximum clock speed of 740 kHz.
In 1974, the company introduced the Intel 8080, an 8-bit microprocessor. While other
companies sold computers for thousands of dollars, Intel with its 8080 processor only
charged $350. Soon Intel became the industry leader.
1978 saw one of the first x86 processors when Intel unveiled the 16-bit 8086. The 8086
took a long two years to achieve wide usage as its competition, while the Motorola
68000 had been selling faster. Intel responded with the help of sales effort and
marketing to establish its proprietary architecture as the go to standard. In 1976, AMD
entered a cross-licensing agreement with Intel, therefore allowing AMD to reproduce
its products. By 1980, Intels 8051 and 8751 introduced and quickly became the bestselling microcontrollers. Also Intel reached 15,000 employees from the 12 employees
it had in 1968.
In 1981, IBM introduced the Personal Computer (PC), which was met with huge
success. By 1982, Intel had created the Intel 80286 and IBM has interest in using it for
their PC line-up. Due to the early nature of semiconductors, IBM requested for a second
source of the microprocessor and AMD signed the contract with Intel to a 10-year
technology exchange agreement.
When Intel launched the 80386, Andrew Grove who became the CEO of Intel redirected
the company to put all company resource into microprocessors. The most significant
redirection is to single source the 80386 therefore denying license of other
manufacturers. Processors during the early days are risky to produce but Intel opted to
produce the processors in three different areas while convincing the customers for
consistent supply. IBM PCs became popular during that period and along it Intels
processors.
Intel introduced the 486 in 1989 and rolled out its first Pentium chips in 1993. The
company debut the Core line of processors starting with the Core and Core Duo for
laptops in January 2006. It was followed by the Core 2 Duo for the desktops in July

2006 and the Core 2 Quad in 2008. The iconic i3, i5 and i7 line of processors were
launched from September 2009 to January 2010.

1.2 Advanced Micro Devices (AMD)

1.2.1 Introduction
Advanced Micro Devices (AMD) is a semiconductor organisation based in Sunnyvale,
California, USA. Founded by Jerry Sanders, the company makes CPUs (Central
Processing Unit) and after acquiring ATI Industries, makes GPUs too (Graphic
Processing Units). The CEO of AMD currently is Dr. Lisa Su with Raja Koduri as the
head of the Radeon Technologies Group. AMD had 9139 employees as of Q1 2016.
Its main competitors as of today are Intel on the CPU side and NVIDIA on the GPU
side. AMD also produces what it calls APUs (Accelerated Processing Unit) by
combining CPUs and GPUs onto a single chip in the processor. AMD also provides
APUs to game consoles, the two more popular of these are the Xbox One and
PlayStation 4.
AMD sells their processors to servers and home PCs. As of today, their line-up of CPUs
includes the FX line and the A-series APUs for the desktop and mobile and the Opteron
line for workstations and servers. AMD will be launching their new 14nm CPUs with
the new Zen architecture that promises 40% increase in IPC (Instructions Per Cycle)
over the last generation later in 2016. AMD currently holds the Guinness World Record
of being able to achieve 8.429 GHz (Chiappetta 2011). Also, AMD sells the Radeon
brand of GPUs with the R5, R7 and R9 series of graphics cards. As of June 2016, AMD
unveiled their new GPU architecture Polaris and launched new graphics card as the RX
series with the first card being the RX480. Other architecture of GPUs codenamed Navi
will be launching late 2016. The company also produces workstation graphic cards
branded as the FirePro series.
Reports from 2016, suggests the revenue of the company at $832 million with a total
asset amounting to $2.98 billion.

1.2.2 History
The founding of AMD can be attributed to the founder Jerry Sanders and seven of his
colleagues when they decided to leave Fairchild Semiconductor and start a company in
May 1, 1969.
The company took a year to overcome a low stock market and raised 1.5 million USD
from investors. Sanders and the team have experiences as engineers throughout their

carrier at Fairchild, thus they knew the business itself and sought to help manufacturers
of electronics with new challenges. (Silicon Valley Historical Association, 2008)
The company humbly began by revising and retooling existing products by making
them faster and more efficient. AMD landed its first product by 1970 with the Am2501,
a 4-bit shift register which was immensely popular and gained the company its first
revenues. In 1971, the AMD entered the RAM chip market with the Am3101, a 64-bit
bipolar RAM. The company went public in 1972. The company grew in size and
managed to establish an assembly plant in Malaysia, particularly in Penang whistle
increasing its headquarters over at Sunnyvale. By 1974, the company earned up close
to 25.5 million in sales and had over 200 products.
Its main competitor Intel launched the first commercially available microprocessor, the
Intel 4004 in 1971. AMD followed suit into the microprocessor market in 1975 by
introducing the Am9080, a reverse engineered clone of Intel 8080. In 1976, AMD
entered a cross-licensing agreement with Intel. In 1979, AMD debuts on the New York
Stock Exchange (NYSE), enabling more investors on the company.
When IBM moved its company from mainframes to the Personal Computers (PC)
market, it decided to use x86 processors, which then were built by Intel under the
condition that there must be a second source to guarantee a constant supply. AMD
signed the contract along with Intel in 1982 which both companies agree on technology
exchanges that would last for 10 years. The company did not just supply IBM with
processors but to other companies that cloned the blooming market of PCs by IBM, one
example being Compaq.
AMD also produced the Intels 80286 as the Am286, a significant PC processor in the
market those days. While Intels processors range from 6 to 10MHz, AMDs iteration
goes up to as high as 16 to 20MHz, overshadowing those of Intels (Singer 2012). AMD
was denied by Intel the access to the 386 license during an important duration when
IBM PC's market share exploded from 55% to 84%, despite the 10-year technology
exchange agreement. AMD took five years to reverse-engineer the 80386 into the
Am386. While the Intel 386 reached 33MHz, the Am386DX can reach 40MHz. By
then AMD gained its notoriety for having processors that performs better than Intels
at a cheaper price tag.
The trend repeated with the Am486 with roughly 20% more performance than its
competitor for the same price. By 1994, the company revenue doubled to over 2 billion
from 1 billion in 1990. In 1995, AMD unveiled the Am5k86, better known as the K5.
After the acquisition of NexGen in 1996, the K6 processor was launched. The K6 was

a legendary success as it offers the same if not better performance of Intels competition
for almost up to half the price.
In 1999, AMD introduced the Athlon family of processors and quickly made it into
ArsTechnicas CPU of the year. (Farivar and Cunningham, 2013). The Athlon made
headlines everywhere when it became the first CPU to break the coined Gigahertz
barrier by reaching clock speeds up to 1GHz, a milestone in those days paramounting
to breaking the sound barrier (AMD beats Intel to the 1-GHz processor punch, 2000).
In 2003, AMD beat Intel to the punch again by introducing the first commercially
available 64-bit processor, the Athlon64 (K8).
In 2006, AMD acquired ATI Technologies and entered the discrete Graphical
Processing Unit (GPU) market to compete with NVidia. With the acquisition, AMD
sought to combine graphics, Northbridge and CPUs to one single package with their
Fusion initiative.

2.0 ENVIRONMENTAL FACTORS

The necessary step in any organisation to grow and prosper is to able to recognise, anticipate
and deal with the changes in the environment of the organisation using the process called
environmental scanning. Intel and AMD both have an internal and external environment.
The internal environment of the organisation refers to those factors that are present within the
organisation which can impact the success or failure of the organisations. The primary factors
of the internal environment are the employee, management and the organisational culture.
The external environment are the factors and forces that are beyond the control of the
organisation that can indirectly affect the ability of an organisation to function. External
environment can be subdivided into specific and general environment. Specific environment
consists of those factors and influences that can have immediate and direct impact on the
operations of an organisation. Whereas general environment comprise of conditions of
political, economic, social and technological that can affect the performance of an organisation.
Analysis of general environment is also known as PEST analysis.

2.1 Intel
2.1.1 Internal environment
2.1.1.1 Employees
Research suggest that employee engagement can be enhanced by workplace flexibility
which leads to longer job tenure time. Intel has planned to launch a new program called
GROW that promotes individuals growth and inclusion so that employees can have
their career best. According to Danielle Brown, chief diversity and inclusion office,
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Intel believes that keeping their employees engaged and work in team-oriented
environment drive innovation in the organisation. At Intel, every voice is valued and
different perspectives of employees are encouraged (Intel website, 2016). Rewards and
recognition are used by Intel for employee motivation by engaging their hearts. Number
of steps are taken by Intel to award employees:
Promotions are rewarded to those who deserve them.
Managers avoid favouritism.
Performance of employees is fairly evaluated by the team.
2.1.1.2 Management
Intels management philosophy has always been non-traditional. Personal and formal
rankings have never been used in the organisational process. In 1970s, the president of
Intel, Andy Grove implemented a new technique called Objectives and Key Results
(OKR) for setting goals in an organisation (Weekdone, 2016). The current chairman of
the board of Executive management is Andy D. Bryant who continues to utilise this
approach for achieving goals of the organisation.
2.1.1.3 Organisational culture
Intel upholds and support principles and values that contributes to unique organisational
culture. The shared values of Intels culture have a strong influence on the employees
in terms of how they act, dress and perform their routine jobs. The characteristic of
Intels organisational culture are as follows
Innovation: Intel has been a front-runner in technology innovation. Managers at Intel
encourage employees to be innovative and risk taking. As a result, Intel has created
number of projects ranging from microprocessors to fastest solar car powered by digital
tracking technology.
Team orientation: Most of the projects at Intel are team based. The employees
maintain open communication between team members. Managers utilizes the strengths
of individuals in the group to benefit the team.
People orientation: Each individual within the organisation receives the same amount
of care by the managers. It is important to treat the employees with dignity and respect
therefore individuals at Intel are fairly compensated for their dedication towards work
by awards and initiatives (Employee Equity Incentive Plans, 2013).

2.1.2 External Environment

The external environment of Intel will be analysed using PEST analysis tool.

2.1.2.1 Political
Intel is a multinational company therefore it has to operate in different countries with
different government policies, rules and regulations. The political instability of various
countries prevent Intel from conducting their business efficiently and effectively. In
2007, due to instable political conditions of India, Intel had to choose Vietnam for chip
manufacturing. (Forbes 2007) But it took around 4 years to receive the license from the
Vietnamese government. Intel is subjected to international trade regulations due to
increasing internationalism of semiconductor organisations. Therefore consumer
protection has become a major consideration for Intel, which results in Intel focusing
its research on environmental management to protect their consumers.
2.1.2.2 Economical
The target market for Intel is the electronics industry. Electronic industry growth is
coupled with stable exchange rates and the industry growth is fairly progressive,
promises high wealth of opportunities for Intel. The demand for semiconductor is
stronger than ever due to change in technology and need for advanced technology. This
offered an entire avenue of opportunity for Intel to develop their semiconductors and
other electronics products at high rate to keep up with the current demand of market.
Seeing Vietnam that is the fastest growing economy in South East Asia with low labours
cost and low living cost, Intel selected Vietnam to invest millions of dollars in its
economy. (Intel 2007)
2.1.2.3 Socio-cultural
Intel operates in an industry of dynamic nature which requires innovations and changes
to happen every now and then, which requires Intel to respond quickly to the changes
in market preferences and demands. The countries where Intel has invested, Vietnam,
Taiwan and China, have a large workforce due to high population of these countries.
Due to high unemployment rate for educated people and hardworking people in these
countries, Intel has employed a reliable and cheap workforce. (Ralph Jennings, 2015)
2.1.2.4 Technological
Technological factors can be major threats and opportunities and must be analysed
while formulating organisational strategies. Technology is the key survival point for
Intel as its operations depends heavily on technology. Technological breakthroughs in
organisations can influence the firms suppliers, competitive position in industry and
product distributors. Intel has huge profit potential in technology and therefore they
have shifted their attention to wireless devices such as electronic gadgets and smart
phones. Intels advanced facilities and talented staff puts Intel at the top of new
technology for manufacturing more powerful processors and components.

2.2 Advanced Micro Devices (AMD)

2.2.1 Internal Environment
2.2.1.1 Employees
Candidates at AMD have to go through a recruitment and hiring process before being
appointed by AMD. AMD strength of employees, as of first quarter of 2016, is 9,139
and runs operations in 31 countries. (AMD 2016) The employees at AMD make a world
of difference while building a corporation to last. This is the reason that the employees
of the company was listed in 100 Best Corporate Citizens List 2010. (CRO 2010)
2.2.1.2 Management
AMD is where it is currently due to its outstanding practices of management. The CEOs
that have joined the organisation from the beginning have managed to diversify the
revenue of the corporation. The current CEO of AMD, Lisa T. Su, has held several
management positions before joining AMD in 2014. Ms. Lisa, was named in Top 100
Young Innovators by MIT in 2002, managed to lead AMD towards innovative and
fame due to her excellent skills. AMD has been continuously named in Fortune 500
List fifteen times in a row due to its management commitment to be innovative and
useful to customers. The management of AMD collaborates with the views of nonmanagerial employees to top managers in making corporate decisions. (Advanced
Micro Devices, Inc. 2016)
2.2.1.3 Organisational Culture
AMD has a very strong organisational culture and live their core values through actions
(Advanced Micro Devices, Inc. 2016). Employees at AMD are motivated to innovate
and work hard and are offered to make a difference through skills and abilities. The
core belief at the AMD are supported through; (Advanced Micro Devices, Inc. 2016)

Agility: learn and adapt to changes in business.

Accountability: Building trust through honouring commitment.

Achievement: Achieve customer focus through innovations and new ideas.

Alignment: work unitedly to perform a task.

AMD culture encourage employees to energize the industry by being the first mover in
the industry. AMD has broken many records like first fully DirectX 11- Capable
Graphics Card in 2009 and record breaking CPU in 2011. Finally, AMD culture is
innovative, team oriented and people oriented where employees work in teams to carry
out the projects and management decisions are in the best interest of employees. (AMD
Culture, 2016)

2.2.2 External Environment

2.2.2.1 Political
AMD (Advanced Micro Devices) is a multinational company, therefore this firm
requires to handle terms with contrasting political conditions of different countries
where it operates. Although some countries provide favourable stable political
environment for business growth, others do not possess such environment. AMD
operates in 31 countries with more than 24 manufacturing facilities in Asia. James A.
Clifford joined the corporation in 2014 as vice president of Global Operations to handle
global operations and technology strategy. Taxation system and government
interventions varies across the globe, for example, operating in USA requires to submit
tax returns annually in the second quarter of the year where as China and Taiwan has
fairly low tax rates and less government intervention compared to USA. Therefore it is
beneficial for AMD to manufacture its products in Asia.
2.2.2.2 Economical
Due to fluctuating exchange rates, depreciation and appreciation of currency will
greatly affect the operations of AMD in that particular country where AMD operates
and manufactures its product. For AMD to be stable and grow in terms of profits, it is
important for the country to be economically stable. The economic crisis of 2009 had a
great impact on the multinational companies in world, including AMD. During the time
of economic crisis, AMD recorded declined in their sales due to lower lending rates by
banks. Once the situation improved, AMD managed to grow back again. This illustrates
that how important is the economic environment for the positive growth of an
organisation. (Economist 2009)
2.2.2.3 Socio-Cultural
The values, principles, cultures and norms are features that specify how an organisation
operate in foreign countries. When AMD operates their business in such countries, the
ideology from their home country, United States of America, will not be of any
meaning. Thus, a geocentric and polycentric view should be implemented when setting
up the business in foreign country. Therefore the corporate culture of AMD will also
vary in order to adapt the culture of natives where they operate. In order for AMD to
work effectively, there is a need to analyse the employment policies, managerial
behaviour and type of products required in that particular country.
2.2.2.4 Technological
Technological inventions seems to have significant changes in the semiconductor
industry. The wide-range of semiconductor devices in the market leads to an elastic
market. AMD needs to continuously transform its technology and introduce advanced
and innovative products to compete in global market. By making products smaller in
9

size, the density of development on the chip increases which means more functions can
be grouped together in a given area causing the cost of electronic devices to decrease.
The advancement in technology varies globally in every country AMD has invested in,
due to heavy dependence of resources availability in the respective country. Taiwan and
United States of America, having high rate of technological advancement, are among
the countries where AMD has successfully invested in.

2.3 Intel vs. AMD

Both organizations Intel and AMD share similar internal and external factors. Both
organizations are investing great amount of money in the innovation, research and development
process to maximize their profits. Both organization are affected at some point due to external
factors that were analyzed using PEST analysis. In order to overcome the issues and sustain a
positive business, both companies develop efficient plans and strategies to eliminate the
ambiguity cause by these factors.

3.0 Sustainability
Sustainability is an act to support or endure something. As the two largest micro-processors
companies throughout the world, Intel and AMD face challenges of environmental
sustainability. This has become a serious matters to both companies as it is to reduce climate
changes and reduce the uses of natural resources. Beside that, both companies also face
problems dealing with sustaining their business to keep up the companys performance and
longevity.

3.1 Intel
3.1.1 Environmental Sustainability
3.1.1.1 Green Buildings
The biggest concern of Intel about the environmental impact is their manufacturing
buildings and sites. To have less impact, Intel had included green design standards and
building concepts into their construction of facilities. As a result, around 25% of their
manufacturing facilities had been awarded for Leadership in Energy and Environmental
Design (LEED). In Jerusalem, the old chillers in the facility were replaced with a
greener and modest models which as a result, around 15% of electricity were reduced
while decreasing the noise level and gas emissions. Moreover, Intel had also install a
photovoltaic solar and thermal panel to produce energy from the sun to reduce the uses
of fossil fuels. (Intel News Release 2010)

10

3.1.1.2 Reducing Climate changes

Climate change is a serious environmental challenge that Intel had face. In order to
reduce the direct climate footprint from the facilities and the supply chain, Intel focuses
on increasing their handprint. Intel had set up a greenhouse gas (GHG) reduction goals
to conserve the energy and minimizing the air emission. Intel had been collaborating
with others companies to decrease the uses of fluorinated gases in their manufacturing.
In the 1990s, they also removed the uses of ozone depleting substances. Besides, Intel
also had invested in alternative energy such as solar, wind, fuel cell and many more to
reduce the emissions and costs over long term. (Intel Climate Change Policy, 2016)
3.1.1.3 Reuse and Conservation of water
Most of the water discharged is from Intels factories and operations. Reducing the
water consumption will help in reducing Intels utility cost as well as the environmental
impacts. Intel believe that one of the way to reach their environmental goals is by reuse
and conservation. The company found out that most of their water use is due to ultrapure water (UPW) to clean up the silicon water during the production. To counter this,
Intel plan is to reuse UPW for another industrial purposes after the manufacturing
process. Besides, Intel also used gray water from the local water treatment centres for
their operations. In 2015, these strategies helped Intel to conserve around 4.1 billion
gallons of water which is equal to the 45% of the companys water withdrawal for the
year. Since 1998, the company invested more than $223 million into water conservation
programs. In result, the programs help to conserve over 52 billion gallons of water.
(Intel Climate Change Policy, 2016)
3.2.1.4 Waste
Intel believed that most of the waste comes from the manufacturing of their product
whereas the construction waste is generated through building and developing new
facilities. Intel had divided the waste into two groups which are hazardous waste and
non-hazardous waste. For hazardous waste, Intel had set a goal of achieving zero
hazardous waste to landfill by year 2020. To reach this goal, Intel had been finding
plenty of innovation ways to treat or remove water streams. To reduce the overall
hazardous water generation, the company focused on the type and use of the chemical
during the manufacturing process. Intel planned to use the 3R strategy for the nonhazardous waste. For example, the company donated unused materials to schools and
some non-profit organizations. To achieve the 2020 recycling goal, the company is
working on raising their global recycling rates. Sites located in Ireland, India and
Shanghai have already reached the recycling rates over 90%. (Corporate Responsibility
Report 2011)

11

3.1.2 Business sustainability

3.1.2.1 Advertising
While developing a new micro-processors, Intel took a new path to enhance its business
which is by advertising the brand and making campaigns. People dont always think
about buying a processor. We want to make the purchase a memorable experience.
People dont buy processors. They buy experiences (Veneski.D, 2012). To let more
people know about the brand, Intel spent a lot in advertising with their own
technologies. Intel had created one of the coolest visual effect in advertising a model
wearing a blue dress with blue butterflies surrounding her. The blue butterflies were
made by an electronic device powered by Intel technology. Besides, Intel had famous
actor, Jim Parsons advertising Intel processors (Tim Nudd, 2015). This advertisement
eventually caught peoples attention quickly and made them associate with the new
Intel products.
3.1.2.2 Innovation
One of the crucial business of Intel comes from their innovation. Intel always had come
out with new products and new technology to maintain and increase their business. Intel
has a very good understanding about the data center market and is innovating in the
right area to maintain its competitive edge (Venkatraman, 2014). During year 2006 and
2007, Intel lost a lot of its market share but able to climb back by developing a new
software-defined storage and data. According to Intels second quarter 2014 earnings
statement, the business group for data centre had increase by 19% annual growth. Due
to the new technologies of Intel, its networking, HPC, cloud and enterprise income had
increased more than 15% in the second quarter of the year. According to Nebojsa
Novakovic, one of the HPC architect at Singapore Computational Resource Centre,
Intel had to develop a lot more innovation in technology. Most of Intels success is
because of the lack of innovation by its competitors. But Intel continue to develop new
technologies and products to help in growth of its business.

3.2 Advanced Micro Devices (AMD)

3.2.1 Environmental Sustainability
3.2.1.1 Programs for employees
To reduce the environmental impacts while improving the employees life style, AMD
had started a go green program call My Sustainability for all the employees in the
companies. This program targets three areas of the employees which is home, commute
and work. In 2014, AMD provided free home solar panels and installation for the
employees and the result is satisfying. The employees in total generated up to 50,000
kilowatt hour of solar energy which is equal to burning 37,000 pounds of coal. Since
12

2007, AMD inspire employees to use alternative transport from or to work such as
providing discount to bike shop, vanpool tickets and more. As a result, they avoided
254,000 gallons of CO2 pollution. (AMD environmental sustainability 2016)
3.2.1.2 Water Reduction Goals
As a semiconductor design and marketing company, AMD had a serious environmental
impact. In 2009, the company set a 5 years goal to water use for approximately 20%
and above. To archive the goal, AMD had identified and evaluated water conservation
and recycling opportunities throughout their companies and manufacturing facilities in
the world. In 2014, the facilities in Suzhou and Penang had reused a total of 13,000
cubic meter of water. The AMD campus located in Austin, Texas had captured and used
500,000 litres of rainwaters for their sites cooling towers. (AMD environmental
sustainability 2016)
3.2.1.3 Supply chain
In AMD supply chain, silicon wafer manufacturing is one of the biggest environmental
problem that AMD faced and is increasing annually. In year 2014, AMD and its
suppliers set goals on environmental, health and safety for the water production. The
company is expanding the goals to its direct suppliers in year 2016. These goals were
set to reduce the environmental impact and increase in its safety measurement metrics.
AMD and its manufacturing partners, Global Foundries and TSMC had achieved all
their goals by the end of year 2015. As a result, both foundries gained outstanding
recognition by 2015. Global Foundries were awarded for its energy management system
and achieved a LEED certification. Besides, the title Industry Group Leader was also
awarded to TSMC. (AMD Supply Chain Responsibility 2016)

3.2.2 Business Sustainability

3.2.2.1 New business philosophy
In order to keep the company stronger, the former CEO and chairman of AMD, Dr.
Hector Ruiz created a new business philosophy. He once stated that Customer-centric
innovation is the pre-eminent value at AMD. It is our reason for being and our strategy
for success. This philosophy is to strengthen the relationship between the companies,
partners and customers and invested in each other. To have a better relationship, AMD
had created a new developer centre to help their partners with the production built with
AMD technology with good efficiency and effectiveness. Besides, AMD also joined
with the China Basic Education Software Company to create a new AMD technology
based computers to help the children with their education in China. In year 2003, AMD
finally comes up with a better processors, the AMD Opteron processors. This
processors gave consumers a better performance which end up AMD made partner with
Sun Microsystems.
13

3.3 Intel vs. AMD

Intel and AMD are the two largest microprocessors companies in the world. Although they are
rivals, but both the companies take good measurements towards their environmental and
business sustainability. Throughout the year, they face many different challenges but they
overcame it with the right measurements. This shows that they have the right policy and
management in their company.

4.0 Ethical Issues

4.1.1 Code of Conduct
Intels code of conduct states that uncompromising integrity and professionalism are the
cornerstone of their company. Intel also insists that their growth depends on these values and
principles.
The Intel Code of Conduct is the standard by which Intel, cooperates to produce products, how
Intel conducts business, and how it preserve the values of Intel and its branch companies. All
employees are bounded by the Code.
The Code of Conduct is affirmed by Intels 5 principles
Conduct Business with Honesty and Integrity
Follow the Letter and Spirit of the Law
Treat Each Other Fairly
Act in the Best Interests of Intel and Avoid Conflicts of Interest
Protect the Companys Assets and Reputation
Intel revised its Code of Conduct in January of 2016 to ensure that directors and executive
officers are expected to provide any conflict of interest directly to the General Counsel, Chief
Compliance Officer, or Board of Directors, as previously the Intel Code required all Intel
employees to report such conflicts of interest to their managers.
The updated Code represents Intels intention to counter human-trafficking, slave labour and
debt-bonded in their company operations.

4.1.2 Misconducts
1) In 13 May 2009, the European Union General Court, the second-highest court ruled that
Intel had misused its position as the dominant market organisation to hurt AMD, and will be
required to pay a fine amounting to 1.06 billion Euros, or the equivalent of $1.45 billion to

14

AMD in damages. The case relates to a proceeding under Article 82, EC Treaty and Article 54,
EEA Agreement.
In the EU General Court proceedings, it was found that, in part:
I.
II.
III.
IV.

V.

Paid rebates to OEMs on the understanding that they (Dell) would buy all or nearly all
of the CPUs from Intel.
Paid rebates to retail stores to only provide stock for x86 parts.
Paid OEMs(Dell, Acer, Lenovo and NEC) to halt or delay the launching of AMD
hardware
Restricted AMD CPU sales on business segment and market. While permitted to sell
higher percentages of AMD desktop chips, OEMs were forced to buy 95% of business
processors from Intel. One manufacturer was forbidden to sell AMD notebook chips
under all circumstances.
Further restricted OEM sales by only permitting the 5% of business systems to be sold
to SMEs, only through direct distribution, and only if business distributers pushed the
launch back by a further six months.

2) In 2009, American Federal Trade Commission (FTC) charged Intel with engaging in
deliberate campaign to hamstring competitive threats to its monopoly and paying AMD $1.25
billion to settle.
The Commission documented an authoritative protest against Intel Corp., the world's top PC
chip producer, with the charge that the organization had wrongfully utilized its overwhelming
business position for 10 years to eliminate competition and reinforce its monopoly. The
complaint alleged that Intel engaged in a course of conduct to shut out rivals competing
microchips by cutting off their access to the marketplace. Specifically, Intel is charged with
syndication in important focal preparing unit, or CPU, markets, and tried to procure a second
restraining infrastructure in the applicable representation markets, utilizing an assortment of
uncalled for strategies for rivalry
3) South Korea's antitrust regulators announced Wednesday, 25 June 2008 that they would fine
Intel 26 billion Won ($25.4 million) for charges of competitive law abuses.
In a statement, the Korea Fair Trade Commission (KFTC) stated that Intel had offered rebates
to two South Korean PC makers in exchange for not dealing with rival AMD. Regulators have
instructed Intel to stop all related actions
Bruce Sewell, General Counsel for Intel Santa Clara criticized by telling the Wall Street Journal
that the company will likely appeal. He said The conduct they're seeking to attack is the
conduct at the heart of competition. It is offering lower prices in order to sell your products.

15

4.1.3 Atonement
1) In the lawsuit case by the EU General Court against Intel, Intel has settled the lawsuit by
paying a fine of 1.06 billion Euros, or the equivalent of $1.45 billion.
2) In the FTC lawsuit, other than paying AMD $1.25 billion, under the settlement, Intel will be
prohibited from:
I.
II.

Providing incentives to OEMs in exchange for their agreement in buying Intel chips
exclusively and to refuse to buy other chips.
Retaliating against OEMs that carryout businesses with non-Intel organisations, by
halting incentives.

III.

Modifying their intellectual property contracts with other microprocessor companies,

such as Nvidia, AMD, and Via so that they are not bonded by Intel from attempting
mergers or joint ventures with other companies, with Intel threatening them with patent
infringement lawsuits.

IV.

Offering Vias x86 licensing contract, an extension of 5 years beyond the contract
period, which would expire in 2013.
Intel will admit to software developers, of existing discrimination of Intel computer
compilers that would discriminate between Intel and non-Intel processors. All software
vendors who want to recompile using a non-Intel compiler, will be recompensated by
Intel.

V.

VI.

Regarding Intels past behaviour and Intels practice of eliminating competition, Intel
will consent to the settlement containing provisions that would fix the impacts of Intels
past behaviour, and disallow Intel from eliminating competition later on.

3) Intel has settled the KFTC lawsuit by paying AMD $25.4 million.

4.2 Advanced Micro Devices (AMD)

4.2.1 Code of Conduct
The AMD Code of Ethics backs the dedication of the companys corporate officers and key
account officials to the highest moral standards and follow the laws, regulations, and company
policies applicable to corporate financial exchanges, reporting and disclosure.
AMD Executives are vested with obligation, and sometimes, power, to ensure, adjust, and
protect the interests of the Company's partners. AMD Executives satisfy this obligation,
partially, by endorsing and authorizing proper arrangements and methods for the organization's
finance association and by implementing and holding fast to the standards put forward in this
code

16

4.2.2 Misconducts
AMD faced a lawsuit by a computer owner, over the alleged misleading information on the
performance of the Bulldozer processors. The case Dickey v. Advanced Micro Devices Inc,
charges AMD that its Bulldozer, and including its Piledriver, Kaveri, Carrizo and so on all
failed during testing, provided only half the number of cores that AMD had claimed and that
by combining certain aspects of the core into a module, and share resources was a deceptive
marketing decision and that the companys decision to combine certain aspects of the core into
a module and share resources constitutes a deceptive practice.

4.2.3 Atonement
AMD has settled the requirements of the lawsuits provided by the court.
The lawsuit seeks recovery of damages for all individuals in the United States that purchased
any of the following AMD Bulldozer processors: FX-8120, FX-8150, FX-8320, FX-8350, FX8370, FX-9370, and FX-9590.
AMD should provide the customers exact monetary compensation, or, at least, the difference
between what they paid for the processors and their actual value. Additionally, AMD is
required to stop all advertisements on its 8 core CPUs and to provide more truthful
advertisements in the future. (U.S. District Court 2015)

4.3 Intel vs. AMD

Since the founding of AMD in 1969, Intel has worked to defeat its only rival in the microprocessor industry to ensure a pure monopoly on the industry. Intel has worked to secure
contracts with Original Electronics Manufacturers (OEMs) by bribing them to only provide
contracts for Intel to deny AMD any business dealings. Intels activities has affected the
semiconductor industry by making it uncompetitive and restricting the advancement of
technology by competitive means.
Intel has committed major violations of international laws and competitive laws across multiple
countries and economic regions in its bid to impede the expansion and rivalry of AMD.
Through a business point of view, they have successfully finished off a competitive entity. But
ethically, they have done wrong by violating competitive laws to eliminate competitors to
ensure a monopoly over the industry. Intel has not shown any repentance and has continued its
questionable business practices.
AMD, on the other hand, has repeatedly misguided the public over the performance of its
microprocessors not intentionally, but with irresponsible claim that can affect its market
performance. AMD has since amended for its past actions by providing compensation for
lawsuits against them.
17

5.0 Social Responsibility

Social responsibility, known as a business practice which in returns to benefit the society. Each
companies should fulfilled the criteria which concerns the aspects of education, social, health
and environment.

5.1 Intel
5.1.1 Education
Intel has established a lot of programs to provide professional development for teachers. Also,
to support students in achieving in science, technology, engineering and math (STEM). The
Intel Teach program was built to help teachers by adding technology tools into classes in order
to engage students with technology for problem solving and critical thinking. This will not only
benefits the students who involves in the program, the teacher will also get to learn new
technology skills and collaboration with online tools which will be an upgrade in their teaching
skills. (Intel Corp. 2016).

5.1.2 Social
The employees of Intel got to experience in lots of meaningful volunteering events. In 2015,
Intel has been providing volunteer services with more than 5,500 schools and non-profit
organisations. In 2015, Intel stated that their employees has involved in volunteering jobs for
an estimated 112,000 hours. Through this Intel Involved in volunteering programs. The Intel
Foundation gives cash donations to schools and organisation for every hour of their employee
volunteered. Intel Foundation has paid out $9.1 million for schools and non-profit organisations
(Intel Corp. 2016).

5.1.3 Environment
Intel designed their new buildings to reach a minimum Leadership in Energy and
Environmental Design (LEED) Gold certification level. Most of their existing manufacturing
facilities have been LEED certified as well. This conservation projects has resulted in saving
more than 3.19 billion kWh of energy. Intel has recycled more than 75% of total waste
generated during operation and have conserved more than 52 billion gallons of water since
2008. On the other hand, Intel also invested in solar, wind, fuel cell and other energy sources
which are design to reduce emissions and cut the overall cost over the long term. (Intel Corp.
2016)

5.1.4 Health
Intel make sure their employees enjoy a better quality of life through a health and safety
program. As we know that all workplace injuries could be prevented, Intel make sure all of
18

their employees, contractors and suppliers has undergone extensive safety trainings. They
believe that the trainings will be able to help the employees to understand the responsibilities
of safety. Also, Intel Vitality program, a proactive health and performance program that focus
on mindset, nutrition, movement and recovery. The employees have to complete a series of
digital health assessment to make sure their health are maintain at a healthy state (Intel Corp.
2016).

5.2 Advanced Micro Devices (AMD)

5.2.1 AMD Foundation
AMD was found upon the value of putting people around the world first. As a result, the
company has invested their time, money and technology with local organisation to lighten some
of the challenges faced in the society. AMD foundation was formed to strengthen their
philanthropic giving throughout the community (AMD, Inc. 2016).

5.2.2 Education
AMD Changing the Game (CTG), AMDs global signature education programme was
established to provide opportunities to study critical science, technology, engineering and
mathematics (STEM) skills for the future generation. The objective of the program is to allow
the youngsters to learn how to create their own game instead of playing games. Students will
be able to improve their skill sets in problem solving, critical thinking, language skills as well
as teamwork in addition to STEM skills through the process of creating a game. This could
play an important role for students as a motivation to go to school (AMD, Inc. 2016).

5.2.3 Social
AMD encourages their own employees and contractors to volunteer while the company support
their hard work by sponsoring volunteer events. The job scope of their employee will be
focusing on improving the quality of life for the people that work and live in or near
communities where the company operates. In 2014, AMD recorded an accomplishment of
volunteering more than 9,200 hours, donated more than 900 units of blood, and participated in
more than 110 company-sponsored volunteer events (AMD, Inc. 2016).

5.2.4 Environment
AMD is a large company. They have been operating in over 20 countries around the world.
Therefore, the company has to take action such as conserving energy. In order to achieve the
goal, part of the energy sources of AMD were derived from wind, which is a renewable energy
source. In 2015, AMD has achieved a 12% reduction in absolute energy usage and claims that
13% of the energy was derived from renewable sources. Other than that, AMD also achieved
a 10% reduction in global water usage and a 77% diversion of waste from landfills. From all
19

these achievements, the savings from all the preserving effort has exceeded an estimated
USD$4million (AMD, Inc. 2016).

5.2.5 Health
AMD do provide programs and services to ensure a safer and healthier work environment and
promote wellness of employees. Throughout the years, AMD established The Wellness
program which organises events and provide services to assist health organisations and also to
improve health-related issues of their employees. In 2012, AMD launched a wellness program
which partnered with WebMD Health Services to provide free health management services to
U.S. employees (AMD, Inc. 2016).

5.3 Intel vs. AMD

AMD and Intel are both the worlds leading company that build semiconductors and
microprocessors. Theyre not only focusing on building more quality and better products but
they never forget to contribute their abilities to the society. Both the companies have a few
similarities. Both of the companies have a Foundation which is to give donation to schools and
organisations. Also, both companies came up with a similar education program which involves
STEM concept to enhance the study experiences of the students and teachers. The program is
to allow youngster to access to technology while learning. Furthermore, both companies do
encourage their own employees to participate in volunteering work as a return to the society.
Both companies are striving to achieve a more energy efficiency in the building in their
everyday operations. Lastly, health and safety of employees do play an important role.
Employees of both companies will undergo a series of health assessment and safety training to
make sure the company is running at its full potential.

6.0 SWOT ANALYSIS

6.1 Intel
6.1.1 Strength
Intels brand name is recognised globally and has strong brand loyalty in the
microprocessor market. Its one of the biggest strength is the commitment towards
research and development (R&D). Investment in the R&D unit is vital for the company.
There would be no special innovations and improvement by the company if the
company would not spend money to develop product that will be up to the expectations
of the customers. Intels spending on R&D reached a record of $10.6 billion in 2013
(Company reports, 2013) which allowed the company to remain competitive. The
research and development did not make the company to be ahead of mobile transition
but still it allowed the Intel to be competitive in the industry.
20

Besides that, the products by Intel are produced in its own facilities. This technique
streamlined the production process, reduce its time to market and manufactures new
products rapidly. The in-house manufacturing of the products can substantially reduce
the cost of new products.
Intels one of the biggest strength is its large and loyal base of customers. When it builds
up new product, the product is easily accepted by the market. Therefore Intel is the
dominant supplier of microprocessors for the personal computers.
Finances also plays major role in the strength of the company. Strong finances helps
the company to make improvements and new innovations while taking risk for new
products. Intel is backed up heavily by the strong finances which keeps it leading the
market
Another reason for the success of Intel is that, it has a strong workforce of experienced
and skilled employees with great knowledge and innovative ideas about the area they
are working in.1.2 Advanced Micro Devices (AMD)

6.1.2 Weakness
One of the major weakness of Intel in the recent years is the downside trend in the sales
of PCs and this weakness is irreversible. In order for the company to reduce this impact,
it needs to expand and enter into new market sectors such as tablets and smartphones.
However such markets depend upon several factors such as marketing strategies as well
as completion in the market. Intel can only succeed in these new markets by
differentiating itself in cost and technology.
Apart from that, one more weakness of Intel is its underuse of its capacity. Due to
decrease in the sales of PC, the company has not been developing new products in the
past, which has left Intel a lot of wasted spaced. If the company had been manufacturing
much more products in the past, they could have overcome the lost and had been a more
money-spinning company.
Moreover, in 2006, Intel announced a new reform that resulted in the loss of jobs for
10,500 employees, or nearly 10% of its total workforce by the end of July 2006.

6.1.3 Opportunities
The aforementioned weakness of the Intel for underutilised capacity also provides
opportunities to the company. These opportunities are to manufacture more products
for other companies while they have excess capacity to do so. This would allow them
to prove to other corporations that they can build up the products to compete in the
mobile market.
21

Intel has an opportunity to offer more diversification in their products in businesses that
are related and unrelated such as cellular industry, broadband and security devices.
Besides that forward and backward integration may also help Intel to improve the
service and quality of the product while reducing the overall cost.
The demands for computer products are increasing at a high rate as time is passing by.
This demand opens the doors for Intel to success which is a great opportunity for Intel.

6.1.4 Threats
Intel operates in many countries, therefore there operations are greatly affected by
environmental regulations and strict government policies. Furthermore, fluctuations in
the current exchange causes Intels financial performance to reduce.
Besides that, Intels business model is also a threat to it. There are some companies that
designs the chips and some companies that just do chip manufacturing. This
competition allows the customers to find better deals to save money.
Even though, server industry is dominated by Intel, the threats from big giants like
Google and Facebook always remains for Intel. Lastly Intels dependency on few
suppliers causes them to lose credibility and makes them vulnerable to failure if the
suppliers fails to deliver the products on time.

6.2 AMD
6.2.1 Strength
Managerial Hierarchy: The current CEO of the company, Lisa Su has been appointed
in 2014. Therefore, the organisation will start gaining the rewards of Lisa Sus
astonishing work now. She has a 20 years of experience in semiconductor products with
a Pd.D. in Electrical Engineering. Su has sufficient amount of experience in providing
a promised products to the AMD which will be vital for the future of the Company.
Cash inflow: In October, AMD sold Semiconductor Assembly and Test services
(SATS), followed by an agreement from Na tong Fujitsu Microelectronics. This deal
gave AMD, a net cash of $320 million. As a result, AMD got enough funds to finish all
its research and products development, especially on its forthcoming Zen processors.
Gaming: Sales in the gaming consolers are rising worldwide and as predicted by the
researched, it will continue to do so in the future. Sales for PlayStation 4 have exceeded
40 million consoles (Forbes 2016) and Xbox One has also been selling a lot. This
increase in the gaming industry is a good news for AMD because it is the main supplier
of semiconductor for this industry, thus an indication for the sustainable growth of
AMD.
22

Costs: The falling costs of the products means rising profits for AMD. Sales, General
and Administrative (SG&A) department of the AMD has demonstrated a fall in cost
from Sep 2014 to Sep 2015. The following graph shows the expenses of AMD from
Sep 2014 to Sep 2015.

Figure 1: Falling production cost of AMD (AMD website)

6.2.2 WEAKNESS
Poor PC market: The personal computers industry is declining rapidly as discussed
earlier. The chart below highlights the steady decline in the sales of PC. Such news is
bad for AMDs growth as they rely heavily on supplying microchips to PCs.

Figure 2: Decline in PC sales (IDC Worldwide Quarterly PC Tracker)

Poor Earnings Report: fundamental evidences depicts AMD in a negative light. The
semiconductor company demonstrated a drop and a loss in revenues. The company

23

reported a loss of $0.17 per share on $1.06 billion (AMD report, 2015). This poor
performance of AMD proves a downward trend which the company is facing.
Lack of Acquisition: The AMDs lack of ambition can be analysed by the lack of
acquisitions in the near future. The organisation is buying small firms like Sea-Micro
which was bought for a $335 million unlike previous large firm like ATI, which was
bought for $5 billion. This lack of drive suggests the poor performance of the
management which may not be suitable for stakeholders relations.

6.2.3 Opportunities
Zen: AMD will launch its Zen-based CPU this year in October. This new technology
is said to offer power efficiency and improved performance to the current 32nm
processors. The new chip can boost the potential of AMD greatly and become a new
leader in the server processor space and high end desktop.
GPU Radeon Pro Duo: AMDs new technology of virtual reality- GPU Redeon Pro
Duo, might help game develops and creators to come up with virtual reality games. It
is believed to be the most powerful GPU in the market. This is a great opportunity for
AMD, as the market for Virtual Reality is already increasing. Its intriguing to perceive
how AMD will handle this business sector, since a true experience of VR needs
excellent immersive display controlled by an advanced GPU.

6.2.4 Threats
Intel: Intel has always been considered better than AMD, due to efficient design of
Intels CPU units. Intel design the CPU to be simply process large amount of data than
AMDs design. Intel has boasted profits of $11.4 billion (Intel Reports, 2015). Intels
huge market dominance always remains a threat for AMD.
IBM: The firm is gradually increasing its production in electronic markets. IBM
demonstrated a new range of products at the Open POWER summit last year. The event
was a joint collaboration between NVIDIA and IBM thus opening the doors to assume
a strong partnership between two firms, which may be damaging to the current status
of AMD.

6.3 Intel vs. AMD

In light of the investigation directed, both Intel and AMD displays resemblances of having a
strong brand image and market share. Other than that, both organizations features a stable as
well as strong financial status. This empowers them to put more on R&D keeping in mind the
end goal to produce and introduce new technologies and products in the market.

24

7.0 PORTERS FIVE FORCES

7.1 Intel
7.1.1 Threat of New Entrants
Due to the diversity and the enormity of the firm, it makes it very tough for the new
players to compete with Intel. As the production facilities and the equipment cost of
this industry is very high, it is difficult for the new entrants to survive with already
established Intel.

7.1.2 Threat of Substitutes

As small companies have entered the market with low cost energy and technology, it is
now easier to find a substitute in the microprocessors market. Therefore Intel needs to
constantly produce sustainable products with innovate technology to keep its products
in the current market. This threat creates pressure on Intel as it is worried that the
substation comes from AMD.

7.1.3 Bargaining Power of Buyers

Buyers in this market involved small imitators shops and household computer
manufacturers. But big organisations like HP and Dell will calculate for the
microprocessor leverages. Power of buyers has changed from period to period in this
industry, but the logo of Intel has been considered by most manufacturers to be
respectable. As it were, buyers will essentially have no place else to turn for
microprocessor other than Intel.

7.1.4 Bargaining Power of Suppliers

There is a thin line of suppliers in the industry, and they have not yet threatened to
integrate onward to the industry or to set up their own outlets due to absence of powerful
IT platform and internet presence. Therefore the bargaining power of suppliers is highly
controlled. This displays a strong competitive advantage for Intel, in that they can
control the costs of their raw materials, hence coming about to more controlled expected
profit.

7.1.5 Current Rivalry

Rivalry in this sector in not very intense due to few dominant industry competitors. It
is unwise to enter an industry that is already immensely competitive. That is why many
small companies like National Semiconductor and RCA (zdnet 2016) have failed even
though the individuals that run them were competent and smart.

25

7.2 AMD
7.2.1 Threat of New Entrants
The semiconductor industry is very vast and expensive industry because of its large
amount of capital and high sunk cost. Therefore, a new entrant would require an
extreme amount of capital and assets to start up. From this perspective, the threat of
new entrance is quite low. Another problem for new company to compete in the industry
has a disadvantage of smaller economy of sale. It would also be difficult for new entrant
to establish channels of distribution in its early stages. Furthermore, users of microchips
have high brand loyalty and are doubtful to switch to a new company, thereby showing
high barriers for new entrants.

7.2.2 Threat of Substitutes

AMD is vulnerable to new substitutes which could result in their products being oldfashioned. But due to diversity of AMD in their products and services, the threats of
substitute for the firm varies along its sectors; the financial sector of AMD being the
most secure from threats. Due to reason that clients would not prefer to substitute their
financial supplier as effectively as they would lean towards changing to another station
in their TV. The technology sector of AMD is also at high risk of being surpassed by a
more effective products. Copy-cat suppliers are also an issue: an organization like AMD
that burns through millions, if not billions, of dollars on the making of a quicker, more
dependable chip will endeavour to recover the R&D costs. In any case, then along
comes a player that figures out the framework and markets a comparative item at a
small amount of the cost.

7.2.3 Bargaining Power of Buyers

There are a modest bunch of rivals in the semiconductor market, accordingly, the power
of buyers is generally substantial in light of the fact that if a buyer is not content with
AMD items, they can change to a more proficient supplier, for instance, Intel.

7.2.4 Bargaining Power of Suppliers

AMD has both a negative and a positive impact on the bargaining power of suppliers
because of large chain of suppliers. On one side, a broken chain of suppliers is possible
to create a havoc in the production line of AMD. On the other side, with the rising
amount of electronic suppliers originating from the Far East, this gives a little leverage
to the present AMD suppliers. AMD quality assurance for suppliers are extremely strict
in this manner, AMD will stop partnership with the suppliers if the quality assurance is
not met at all.

26

7.2.5 Current Rivalry

In terms of rivalry, AMD has few points from its potential and competition. The main
advantage of the firms is its potential ability to conquer the virtual reality sector. It plans
to attain this ability through demanding managerial approach of Lus experience.

7.3 Intel vs. AMD

Because of the boundlessness of both the association, the pressure from the suppliers is low.
On the other hand, the bargaining power of buyers for both organisation is high. Both Intel and
AMD are moderately sheltered from the risk of new participants as they are settled and have
the client dependability on their side. In any case, they are in weight from littler organizations
who produce substitute items with moderate quality although there are not many substitutes in
the market.
With respect to current rivalry, Intel and AMD are the biggest rival to each other and dominates
the market of their products.

8.0 PROBLEMS
8.1 Well-Structured Problems
8.1.1 Intel
Intel faces a rebellion in the hardware industry by portable device producers, such as
Apple, Samsung and even Amazon, because none of them are using Intels processors.
This comes to a shock to Intel, as it has been comfortable with being the sole producer
of microprocessors in the world. Suddenly everyone was making microprocessors of
their own with Apples very own design, which comes as a shock to the multi-billion
chip giant. The problem started out in 2005, when Apple made a switch to Intel, rather
than their old partner IBM. From Intels point of view, they thought that they were
simply the better company for Apple, but from Apples perspective, this was just a
genius move to free dependencies on solely one player and to get ready to produce their
own chips in the future. Now, Apple is playing the same strategy on Intel, with freeing
up their commitments on Intel, and going for their bitter rival, AMD. Not only this
Apple had also the option of producing their own microprocessors, which would be a
double blow for Intel. This has already been seen through their Apple iPhones which
are powered by the A-series chips. (Moren, 2016)

8.1.2 AMD
Cultural Difference: After acquiring ATI Technologies, a GPU company based in
Canada, there was a major cultural difference between the two companies. The
27

disarrayed employees prioritised the needs of their own divisions products instead of
making a combined effort under the Fusion initiative by AMD (Farivar and
Cunningham 2013). AMDs Fusion sought to combine graphics and computing which
led to ATIs acquisition in the first place. However major company cultural difference
delayed the products.
Mismanagement: AMD had quite a few mismanagement issues that led to a decline in
its products. Hector Ruiz stepped down as CEO amidst a series of layoffs in 2008. CEO
Dirk Meyer was ousted by the board of directors for failing to focus more on tablets
and mobile devices (Hollister 2012). During Meyers time as CEO in the company, he
had ignored the notebook and netbook platform which impacted the company when the
market paradigm shifted to low powered laptops.

8.2 Unstructured problems

8.2.1 Intel
Even with a quasi-monopolistic grip on the processor market, Intel faces the problem
of a changing ecosystem of devices. According to research companies such as IDC and
Gartner, the PC sales during the first quarter of 2013 alone saw a double digit
percentage decline in sales (Malik 2013). During this period, the market is starting to
shift to a more portable and mobile oriented segment such as the smartphone boom,
which Intel was late into. As Android and iPhones get more personal, the need for a
personal computer (PC) lessens as technology gets to a point that it fits to an average
consumers palm.

8.2.2 AMD
PC industry decline: As the economy grows larger, the demand for mobility of work
devices increases. This meant work can be taken everywhere, from homes to coffeeshops and back to offices. The increasing demands meant the PC sales declined heavily
in favour of laptops. Also, the Thailand floods in 2011 significantly affected a lot of
sales from tech companies (Ziegler 2011).
Competitive pressure: While trying to recover from a few engineering and managerial
problems such as delays in the 32nm processes that caused delays of Llano APUs and
Bulldozer CPUs, AMDs competitor Intel had been practising monopolistic activities.

8.3 Intel vs. AMD

Intel and AMD are both the giants in the microprocessor industry, and while Intel is indeed the
sole true giant in the industry, controlling well over 90% of the market. With that in mind, it
then makes sense why both Intel and AMD face different and sometimes somewhat similar
28

problems, but on completely different scales. For example, Intels problems are that
manufacturers dont buy its chips because it is accustomed to manufacturers buying from Intel,
as it is long seen as the status quo. While AMD faces problems selling its chips mainly because
Intel blocks their access into the market through questionable methods. While Intel is less likely
to be hit in a market slump compared to AMD, mainly because Intel would still be selling its
chips regardless of a drop in sales for computer manufacturers because mainly all chips are
from Intel. While AMD faces huge problems in such a condition because it is already pressured
by the markets.

9.0 DECISIONS
9.1 Intel
9.1.1 Policies
Minimizing Environmental impact policy: Intel believed that protecting the
environment is a good business and their technology and products can be a big role.
Therefore, they wanted to conserve natural resources with the uses of renewable
energies and the 3R which is reducing, reusing and recycling for their operations.
Besides that, design and manufacture products which can minimize the environmental
impact is also included in this policy. (Krzanich 2013)
Private policy: To continue increasing the success and growth of the business, Intel
recognized that private policy is one of the key components. Intel should protect the
privacy of the individual and retain the uses and flow of individual information.
Communication policy: Intel believe that international communications policies such
as promoting a widespread, cheap yet high quality of broadband internet access can rise
the availability of good internet and communications services. By developing a cheaper,
high quality broadband and improving the price and quality of the data applications will
rise the server demand and the PC purchases.
Cyber security policy: Cyber security is one of the main components of Intel. The
company is improving the cyber security as customers and developer of cyber security
technology.

9.1.2 Procedures
Minimizing Environmental impact policy: Building green buildings and factories is
one of the actions that Intel took to reduce the environmental impacts. Design an energy
efficiency products enable the reduction of environmental impacts. For example, Intel
is able to reduce the greenhouse gas by using energy efficiency gains on one of their
silicon products. (Intel and the environment 2016)
29

Private policy: The privacy regulation must be widespread and flexible. It must be able
to protect individual effectively and must able to adapt to changes in technology and
innovations. Besides that, privacy legislation must be able to provide consistent and
predictable enforcement for the individuals. Moreover, it should provide free flow of
data and impose no excessive burdens to the company. The privacy legislation and
policy initiatives for example free trade agreement, must not restrict the data flow
throughout the protection. (Intel 2016)
Communication policy: Intel is encouraging many countries to carry out a national
broadband plans, adopt a broadband programs to promote the uses of broadband. The
area suitable for the uses of 3G and 4G must be clear and flexible as to allow carriers
to change their technologies, services or plans freely. To make an extra spectrum for
mobile broadband, Intel suggest that The World Radio Communications Conference
2015 should be responsible about it.
Cyber security policy: Intel recognized that this policy is important and must achieve
it. In order to achieve it, the company encourage governments to pay attention on twoparty agreements approaches. This is to strengthen the cyber security and the privacy
in a mean time developing an IT innovation. Besides that, all cyber security policies,
standards and regulations should include sufficient privacy protections.

9.2 AMD
4.2.1 Policies
Equal Opportunities policy: AMD believes that everyone including their employees
and partners should be treated fairly. This policy works for any races, religions, gender,
status and more. Decisions about promotion, recruitment and other benefits will be
made without any illegal discrimination. AMD recognize that equal opportunities is not
only a good management but also improve their business sense. They believe that this
policy will help those to develop their talents and potential to the maximum.
Energy efficiency and greenhouse gas emissions: AMD Company works with their
stakeholders to invent and promote energy efficient technology such as the computers,
data centre equipment and operations. Besides that, they also support the invention of
tools to measure the carbon footprints of the products. (AMD 2016)
Competition and market access: Competition in the market is basic to test the ability
of individuals or companies to bring out innovative, new technologies. AMD set this
policy to protect customers from anti-competitive business practices and to ensure an
open market. Then, the company believe that competition and market access is one of
a business ethics and must be considered as a main component.
30

9.2.2 Procedures
Equal Opportunities policy: To achieve this policy, AMD is promoting equal
opportunity for all the people and also a good environment where everyone is treated
fairly. All complaints regrading the discrimination will be dealt seriously and
appropriately. Employees have the right to pursue complaints of discrimination to the
Fair Employment Tribunal. Any victimization will end up in disciplinary action and
also warrant dismissal.
Energy efficiency and greenhouse gas emissions: To work with this policy, AMD
participates in the US Environmental Protection Agencys (EPAs) Energy Star
program to develop an energy efficiency standards for computers and servers. They also
work with their stakeholders to create an energy efficiency metrics for computing
products. To reduce the greenhouse gas emissions, AMD engage themselves in the
development of the International Electro technical Commissions international
standards and also the Greenhouse Gas (GHG) Protocol. They also involved themselves
in the ICT footprint initiative conducted by the European Commission Information
Society and Media Directorate-General. This reason to join this event is to measure the
energy consumption and the carbon emissions from their products.
Competition and market access: AMD is working with government around the world
to promote a competitive purchasing practices that are performed based on the World
Trade Organizations Government Procurement Agreement, a global standard for open
and fair government policy. This step helps to carry out the advantage of competition
and innovation to governments around the world.

9.3 Intel vs. AMD

Both companies approaches their policy in different ways. Intels private policy require
the regulation to be widespread and flexible so that it is safer for individuals to use.
Besides that, Intels communication policy is to create a worldwide broadband which
is affordable and high quality. This is an interesting innovation and a good business
strategy. One of the AMD policy is equal opportunities which Intel does not have. This
policy is to help the employees working in AMD so that they can be treated equally.
Although they have different ways looking into the policy and procedures, they do have
one in common that is minimizing the environmental impacts. As a top semiconductor
company, Intel and AMD try to find ways to reduce the carbon footprints and the
greenhouse gases emissions by using their technology while increasing their
sustainability.

31

10.0 DECISION MAKING STYLE

10.1 INTEL
10.1.1 Right decisions
Linear Thinking style: In June 2016, Apple has started efforts to produce its Apple
iPhone7. Apple has started working with Intel for the upcoming versions of the iPhone
7. Intel will supply modem chips for iPhones for AT&Ts network, while Qualcomm
will supply for Verizon network phones and for China. This is a good decision because
they can slowly break into the competitive and lucrative mobile industry. In Intels point
of view, AT&T is the USs second largest cell provider, so it represents a significant
breakthrough into the mobile industry. Intels decision to accept Apples offer is a great
decision because from a linear thinking style, Intel is using rational, logical thinking to
use Apple to break into the mobile industry. (The greatest business decisions of all
time, 2012)
Non-Linear Thinking style: Intel has made great decisions that have propelled it to
the top of the microprocessor industry since its founding in July 18, 1968. In 1991, Intel
had successfully got consumers to use its microprocessors by branding computers that
sport its product Intel Inside. When computers were first sold, not many people knew
how the computers worked, but still many people bought them as it was seen as an
advancement of the age. One of the main problems of the microprocessor industry was
the sheer success of it. The extraordinary success of the microprocessors pushed the
technological advancement such that each generation of chip was obsolete when the
next one came out. So Intel had replaced their 16 bit microprocessor, within 3 years
with the 32 bit. The problem was, nobody knew the difference and nobody was buying
them. Back then, nobody knew what was inside a computer and who made the parts.
One of the young technical assistants at Intel, Dennis Carter, understood that most
people didnt know the difference and nobody was buying the new chip. So he told his
boss, Grove at the time, that he believed that the reason consumers were not buying the
product was because nobody was aware of the product differences, so Grove provided
$500, 000 to test Carters suggestion. With a brilliant marketing strategy, Carter took
out billboards with big bold letters, 286, the 16 bit microprocessor, and a red X
graffiti over the letters 286. After two weeks, another sign was put up, showing 386
inside a circle. The message was that the 286 processor was obsolete, and the 386 was
in. Intel was able to promote its microprocessors, and within weeks, sales of the 32 bit
microprocessors rose drastically. As a reward, Carter was made head of marketing.
Carter has made an excellent decision by using the emotions of the consumer to boost
sales of Intel. (Yoon, 2016)
32

10.1.2 Wrong decisionLinear Thinking style: Intel has a history of making bad decisions in trying to expand
their corporation by mergers and acquisitions (M&A). Intel has spent over $11 billion
buying companies and the vast majorities of them have failed in acquisition. Intel uses
M&A as a company expansion strategy, which is impractical, because if a corporation
does not have any experience in those fields, they have a high chance of failure because
of lack of knowledge in the field. Intels key strength is in their monopoly of
microprocessors and most of their profits stems from the sales of these microprocessors.
But they have not ventured out beyond these microprocessors and have not tried to
produce other things. Therefore, it was a bad decision to jump and acquire a new
company in a different industry without knowledge or experience in that industry.
(Cheney, 2010)
Non-Linear Thinking style: In 2013, former EO of Intel, Paul Otellini admitted, in an
interview with The Atlantic, that he regretted the decision to reject making
microprocessors for Apples iPhone in 2007. Intel had targeted the mobile
microprocessor industry, and had made multiple agreements with mobile companies.
When Apple approached Intel to build microprocessors for their new Apple iPhone,
Intel rejected them. Intel was only interested in selling its x86 microprocessors for the
Macs and their supporting chipset. It wasnt interested in making mobile
microprocessors for Apples iPhone because in the interview, Paul Otellini said that he
couldnt imagine Apple making them in large quantities. After being rejected, Steve
Jobs eliminated their in-house custom chip design team and went to manufacture the
whole product alone by Apple. Apple introduced the A-series chips used solely by
Apple iPhones. Today, the iPhone is the worlds number 1 selling smartphone, so Intels
decision to reject Apple was a bad decision. Learning from this mistake, Intel is now
planning to introduce itself into the 5G industry as smartphone prices fall. Intel has
cancelled producing its Atom smartphone chips, and changing its strategy to focus on
mobile connectivity rather than mobile microprocessors. (Shah,2016)

10.2 AMD
AMDs approaches to decisions can be described as a Non-linear Thinking Style. While it
seems that this decision making style is formed from hunches and insights, it is the more
creative decision style that drives innovation.
For example, AMD had designed the Bulldozer architecture of CPUs for the server market
which focuses on more multi core usage. Their decision to combine two physical cores into
one module yields better multi core usage but with lower IPC which is great for servers.
However they had think too far to the future as they had expected more developers to code
33

programs that run well on multiple CPU cores. The current software had not adopted multi core
programs until recently.
Another example is on their GPU line up where the Graphics Core Next (GCN) architecture
developed after the acquisition of ATI features Asynchronous Computing Engines (ACE).
Async compute enables GPU shaders to independently render graphics without waiting for a
synchronised scheduling. However during its release, the majority of games that run on
Microsofts DirectX 11 APIs do not support the function and AMDs products cannot run to
its fullest potential until today, with more games releasing on the newer DirectX 12 and Vulkan
API.

10.2.1 Right Decisions

Acquisition of ATI: Without doubt, the acquisition of ATI Technologies is the most
significant decision in the history of AMD. While it might have been an expensive
decision and a double edged sword, AMD had pushed the industry forward as a whole.
Moreover, the companys Fusion initiative birthed the APU which incorporates GPU
cores into the CPU die. AMD had also developed a low level API named Mantle with
the ability to reduce CPU overhead in games. AMD decided to give away Mantle to
Microsoft and Khronos, which it would eventually become the heart of two new APIs
namely DirectX 12 and Vulkan. AMD had been vocal about the importance of open
standard technologies dissimilar with its main competitors Intel and Nvidia which relies
on proprietary systems (Pirzada 2015).
Diversify to Semi-custom: AMD had been losing market share of the x86 PC
microprocessors over the years. Under Rory Read as then CEO and now Lisa Su, the
company diversified into the semi-custom industry for servers and designs that use third
party ARM cores. With the semi-custom business, AMD has gained a significant
amount of customers and had been successful that it supplied chips to all three major
game consoles, the Xbox One, PS4 and Wii U (Hachman 2014). Diversification of the
company helps a lot as it opens up more market in which the company can benefit from.

10.2.2 Wrong decisions

Overpriced purchase: AMD made the decision to purchase ATI Technologies.
However the acquisition which totalled for USD 5.6 billion was 3.2 billion more than
what ATI was worth in which the 3.2 billion was allocated for goodwill (Williams
2007). While acquisition is perfectly logical, it was overpriced. This was due to poor
managing where the company failed to evaluate the acquisition correctly, and the assets
bought had already declined by the time of purchase.

34

Under-priced sale: After the acquisition, AMD sold the mobile division of ATI known
as Imageon to Qualcomm in 2009 which was struggling at the time for only USD 65
million, which is substantially low. The agreement is that Qualcomm will not only
acquire AMDs handset division but also the graphics, multimedia and other intellectual
property (Ferguson 2009). The smartphone market however skyrocketed following the
sales of Android and iOS based devices. It was a missed opportunity for the company
and the managers had failed in the long term planning of the company.

10.2 Intel vs. AMD

Intel and AMD have widely different methods to deal with problems. This is because of AMDs
need to stay tough to survive its market condition and Intels laxness because it is the
undisputed force in the market. Intels decision making mainly revolves around mergers and
acquisitions(M&A) to expand, while this is seen by most experts as a horrible way to expand
ones company, AMD meanwhile uses M&A to break into another industry, and often gets
better results than Intel, such as the case of ATI. Intel is also more prone to making bad
decisions as result of their laxness as compared to AMD, which is more battle-hardened and
more competitive in making sure they stay in the market and compete with Intel. Intel, on the
other hand, understands the value of money, which is why in rough comparision, Intels
products are far more expensive then AMDs, and while this is more of a moral issue, in a
business perspective, they have done well to get more cash from their goods.

35

10.3 Characteristics of Good and Bad Decision-making Process

Based on the analysis decision making styles of both companies, the characteristics of right
and wrong decision making process are listed in the tables below.
Right Decisions

Blend analytical
with intuitive
thinking

Preserve the
welfare of
cunsumers

AMD has made a decsion to purchase ATI

Technologies and it has pushed the industry
forward to a whole new level.
Intel started working with Apple as a supplier of
modem chips in order to allow Intel to break
into the mobile industry in the future.

AMD has gained more customers by diversify

into a semi-custom industry for third party
usage which allows AMD to supply to more
companies.
Intel has successfully boosted their market by
advertising their flagship 386 microprocessor on
billboards and print media back in the 80s.

Wrong Decisions

Not prioritizing long

term goals and
future-oriented

Insufficient of
informations and
experiences
gathered

AMD missed the opportunities to make larger

profits by not selling their products at a higher
price.
Intel refused to make microprocessors for
Apple's iPhone in 2007 and regreted after
iPhone have successfully become one of a top
selling company.

AMD purchased ATI Technlogies at a price where

it wasn't worth that much and this was due to
the lack of analysis of information of the
company.
Intel failed to expand their company by
purchasing M&A because of lack of
informations and experiences in a different
industry.

36

11.0 RECOMMENDATIONS
Based on this case study about AMD and Intel, there are a few suggestions that can be
commended to both the companies. Throughout half a century, both giant microprocessor
entities along with other participants have vastly improved the world with life changing
technologies. Therefore feedbacks from the consumers are needed to further improve as the
market evolves.

11.1 AMD
AMD makes good products, however its poor performance in the market can be attributed to
its weak public relations team and its less aggressive marketing strategies that what is employed
by AMDs greatest rivals. As a result, AMD only manages to take a small bite of the CPU
market share as well as the GPU market share. Therefore, it is recommendable that AMD starts
to change its employing strategy that prioritises hiring engineers to a balance where more in
the public relations and sales team are hired to advertise the products. This does not mean side
lining engineers in favour of marketing but to find a balance of both where one creates the
products and the other introduces the investors and consumers to the said product.
While AMD has initiated more on open source development of products which is substantial
to many developers and consumers alike, the company can take a step further by creating and
innovating open source standards. This enables AMD technologies to become the norm when
it comes to developing technologies, of course without compromising itself.

11.2 INTEL
Intel is a giant and a veteran when it comes to the semiconductor industry without doubt. One
recommendation available to Intel would be to support free and open source technology
development. Whilst having notoriety in locking down proprietary technologies to itself, the
move to support free open standards can prove to be beneficial in the long run with support of
open source developers. This can ensure Intel supports a transparent business practice.
It is also recommended that Intel price their products more competitively. This is due to the
price of their products being on the more expensive side. Cheaper products encourages more
consumers to purchase as well as being able to increase the target demography. This helps in a
lot sales and market share.

37

12.0 CONCLUSION
From the analysis and findings of this research project, we can state that AMD and Intel are
the two leading microprocessors corporates in the world. Both companies manage to maintain
their diversification structures and accomplishments. The threat of new entrants for both the
companies is negligible which results in strong rivalry which is reflected in their advertisement
and marketing strategy. Even though Intel established well in the business itself, AMD didnt
come up short in the industrial revolution. Both companies have made ground breaking
discoveries and technologies using their innovative products and services that has changed the
world today.
Both organisations have heavy emphasis on ethics and share a strong organisational culture.
However, several operational and management issues as well as challenges were faced by the
organisations throughout the years. SWOT analyses helped out to study those challenges.
In this report, internal and external environmental factors and their problems were highlighted.
In decision making analyses, the right and wrong decision of the organisations were discussed
throughout their operational time. The issues related to sustainability and whether the
organisation is socially responsible and environmentally friendly were also discussed. Overall
the aims of this report were achieved through in depth evaluation of management practises of
both corporates.

38

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42

35. Krzanich, B, 2013, Environmental, Health and Safety Policy, INTEL, viewed on 15th
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36. Malik, Om 2013, Intels dilemma and the slowly crumbling PC ecosystem,
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45

14.0 APPENDICES
MEETING TEMPLATE
Meeting Number

01

Date

25-06-2016

Time

2:00 Pm

Venue

Swinburne Library

Meeting Ended at

3:00 Pm

Attendance

Absent

1. Muhammad Hasan Tariq

2. Isaac Mering Ating
3. Tay Guan Yu
4. Alexander Soon
5. Javan Liew

No.

Agenda

Purpose
Meeting

Actions
of

To meet and greet

Current Status
Completed

To handle general matters

To decide the topics

Discussion

Group introduced each other.

Completed

Listed few topics to choose from.

Hasan is assigned to get confirmation from the
lecture about the topics.
Group Task 1 is analysed.
3

Ending Notes

Muhammad Hasan is selected to write the Completed

meeting minutes of the group
Facebook pages has been formed for easier
confirmation and file sharing
Meeting template is assigned to be completed
by Muhammad Hasan
Members of the group will start doing initial
research on the topics.
46

 Meeting terminated at 3:00 Pm

MEETING TEMPLATE
Meeting Number

02

Date

27/06/2016

Time

4:30 Pm

Venue

Swinburne Library

Meeting Ended at

5:15 Pm

Attendance

Absent

1. Muhammad Hasan Tariq

2. Isaac Mering Ating
3. Tay Guan Yu
4. Alexander Soon
5. Javan Liew

No.

Agenda

Purpose
Meeting

Actions
of

Discussion

Discussion about initial presentation

Current
Status
Completed

Finalisation of the topic

To discuss about group task 1

Completed

To give task of each member for group task 2.

3

Ending Notes

The topic was finalised to Intel VS AMD.

Completed

Group task 1 started.

Hasan is chosen to prepare initial presentation
slides
Isaac was chosen as presenter for initial
presentation
Hasan is required to upload the presentation slides
after the presentation
Gantt chart is developed by group to complete the
task on time

47

 Hasan

will

do

internal

and

external

environmental factors for Intel and AMD

Isaac will do ethical issues
Alexander will do background of the companies
Javan was selected to do social responsibilities
of each organisations
Guan was assigned to do sustainability issues
Meeting terminated at 5:15 Pm

MEETING TEMPLATE
Meeting Number

03

Date

02/07/2016

Time

3:00 Pm

Venue

Swinburne Library

Meeting Ended at

3:30 Pm

Attendance

Absent

1. Muhammad Hasan Tariq

2. Isaac Mering Ating
3. Tay Guan Yu
4. Alexander Soon
5. Javan Liew

No.

Agenda

Purpose
Meeting

Actions
of

To update each other on group task 2

Current
Status
Completed

To check work of each other

To share more sources among group members

Discussion

Reliable sources were shared by Alexander about Completed

the background of the company

48

Ending Notes

Hasan updated his progress on environmental Completed

factors
Isaac updated on ethical issues
Guan updated on sustainability issues
Javan updated on social responsibilities
Alexander updated on the back ground of the
companies
Meeting ended at 3:30

MEETING TEMPLATE
Meeting Number

04

Date

10/07/2015

Time

3:00 Pm

Venue

Swinburne Library

Meeting Ended at

4:00 Pm

Attendance

Absent

1. Muhammad Hasan Tariq

2. Isaac Mering Ating
3. Tay Guan Yu
4. Alexander Soon
5. Javan Liew

No.

Agenda

Purpose
Meeting

Actions
of

Discussion

To hand over task of each member to Hasan.

Current
Status
Completed

To compile the report.

Read through each others work.

Completed

No further discussion was done.

3

Ending Notes

Hasan was selected to compile the report for task Completed

2.
Group task 3 to be discussed in next meeting.
Meeting terminated at 4:00 Pm

49

MEETING TEMPLATE
Meeting Number

05

Date

13-07-2016

Time

2:00 Pm

Venue

Swinburne Library

Meeting Ended at

3:00 Pm

Attendance

Absent

1. Muhammad Hasan Tariq

2. Isaac Mering Ating
3. Tay Guan Yu
4. Alexander Soon
5. Javan Liew

No.

Agenda

Purpose
Meeting

Actions
of

To handle general matters

Current Status
Completed

To distribute Work among team members for

group task 3

Discussion

Topics were selected by each member

Ending Notes

Hasan will do SWOT ANALYSIS and Completed

Completed

PORTERS five forces

Isaac will do Problems faced by organisation
Alexander will do decision making of the
organisation
Javan was selected to do characteristic of
good and bad decisions.
Guan was assigned to do decisions of the
organisation compromising of policies and
procedures
Confirmed to have next meeting after some
completion of work
Meeting terminated at 3 Pm

50

MEETING TEMPLATE
Meeting Number

06

Date

19/07/2016

Time

12:30 Pm

Venue

Swinburne Library

Meeting Ended at

1:15 Pm

Attendance

Absent

1. Muhammad Hasan Tariq

2. Isaac Mering Ating
3. Tay Guan Yu
4. Alexander Soon
5. Javan Liew

No.

Agenda

Purpose
Meeting

Actions
of

Discussion

Review of each others work

Current
Status
Completed

Learning from mistakes in group task 2 to

improve on group task 3
Remarks and suggestions from group members Completed
were exchanged
Progress of each member was reviewed by the
group

Ending Notes

Hasan was chosen to compile the report for group Completed

task 3
Hasan updated his progress on SWOT analysis
and PORTERS FIVE FORCES
Isaac updated on decision making style
Guan updated on policies and procedures of an
organisation
Javan updated on diagram for good and bad
decision
Alexander updated on the problems faced by an
organisation
Promised to send work to Hasan on Facebook by
Wednesday, 20 July 2016.
51

 Meeting ended at 1:15 Pm

MEETING TEMPLATE
Meeting Number

07

Date

25/07/2016

Time

4:30 Pm

Venue

Swinburne Library

Meeting Ended at

5:45 Pm

Attendance

Absent

1. Muhammad Hasan Tariq

2. Isaac Mering Ating
3. Tay Guan Yu
4. Alexander Soon
5. Javan Liew

No.

Agenda

Actions

Current
Status

1
2

Purpose
Meeting
Discussion

of

Review of each others work

Completed

Finalizing the report

Discussion was done on the formatting of the Completed
report and to add extra topics like executive
summary, recommendation and conclusion
All the group members will meet next day to
prepare the presentation slides followed by the
practise of presentation next day.
All group members discussed to review each
others topics and to add extra data if they can
find it.
The final work will be sent to Hasan on the same
night, so he can compile the report

52

Ending Notes

Final report was compiled by Hasan.

Completed

Next meeting schedule on 26-07-2016 to prepare

for presentation slides.
Use blackboard and social networking to keep up
to date.
Meeting ended at 5:45 Pm

53