The Intel besieged flea manufacturer has confirmed the restructuring plans in a quarter of work which will involve an unscpecified number of layoffs. It was reported this week that the company could dismiss around 20% of the staff (it had 108,900 employees at the end of last year). In a memo, the new CEO LIP-BU Tan refused to detail the extent of the reduction in the workforce, which largely aims to reduce the “unnecessary bureaucracy” and the intermediate management layers.
“I am a great supporter of philosophy that the best leaders derive the most with the least. We will embrace this state of mind through the business, which will include the empowerment of our best talents to make decisions and take more possession of key priorities,” Tan wrote. “There is no way to get around the fact that these critical changes will reduce the size of our workforce. As I said when I joined, we have to make very difficult decisions to put our business on a solid basis for the future. It will start in T2 and we will travel as quickly as possible in the coming months.”
Intel has considerably reduced its workforce in recent years. Last August, the company said that it would reduce more than 15,000 jobs to reduce costs. Intel has trouble slowing down sales – he did not act quickly enough to follow the change from the industry to artificial intelligence.
Unsurprisingly, AI will be an objective for Intel in the future. “My goal will be to ensure that our team builds very competitive products and will meet the needs of our client when we enter a new era of computer science, defined by AI agents and reasoning models,” Tan said during a call with investors on Thursday. “To achieve this, we adopt a holistic approach to redefine our portfolio to optimize our products for new and emerging AI workloads. We provide the necessary adjustments to our product roadmap, so that we are positioned to manufacture the best class products while remaining in the laser focused on execution and ensuring time delivery.”
Tan aims to accelerate things by transforming Intel into a company focused on engineering. “Many changes that we will drive are designed to make engineers more productive by removing work flows and work processes that slow down the pace of innovation,” he wrote. The company plans to reduce costs elsewhere in order to “make necessary investments in our roadmaps of engineering and technology talents”. He hopes to reduce $ 1.5 billion in operating functions over the next two years.
Efficiency is the name of the game here. Tan wants managers to get rid of unnecessary meetings and reduce the number of people who attend meetings as “too precious time is wasted”. Intel also extends its mandate to return to the office by forcing workers to be on the spot four days a week (against three) from September.
Tan certainly has high goals as he seeks to reverse Intel’s fortune. “I am talking about the opportunity to fundamentally reinvent an industry icon. To make a return that will be studied in business schools for future generations. To create new technologies and deploy them on a large scale to change the world for the best,” he wrote. “Intel was once largely considered to be the most innovative company in the world. There is no reason why we can not return, as long as we drive the changes necessary to improve.”
