RealTime IT News

Intel to Cut Management Positions

Intel said today it plans to cut about a thousand managers from various offices worldwide in a bid to boost efficiency. No details were forthcoming on where the cuts would be made or in what specific areas.

The chip giant has been in the midst of a thorough, 90-day review ordered by CEO Paul Otellini back in April designed to wring a billion dollars in savings.

Internetnews.com obtained a copy of the memo Otellini sent to Intel employees today, which said in part:

"You should expect that we will continue to take actions, including selective reductions, as we complete analyses and decisions about investments, expense levels and organizational structures."

He also tried to buck up the troops with a reminder that Intel will remain "the largest and most profitable semiconductor company on earth," at the end of the reorg process.

And that the actions the company is taking are designed to ensure that remains true well into the future.

Otellini called today's layoff announcement "an essential first step toward making us more competitive."

Other actions are likely, but this first cut was a direct result of the analysis that left Intel  with the conclusion "we have too many management layers," company spokesman Bill Calder told internetnews.com.

"We've benchmarked ourselves against the rest of the industry and we're addressing ways we can be more efficient."

Intel is facing its biggest competition in years from AMD, which has made big inroads in server and consumer desktop processor sales.

At the same time, Intel is charging full-speed ahead with announcements planned for this summer, including next week's long-awaited "Montecito" dual-core Itanium, set to be unveiled at a media event in San Francisco on Tuesday.