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.
