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Intel Corporation: Outsourcing Dilemma
內容大綱
California-based Intel Corporation (Intel) was one of the world’s leading semiconductor circuit firms. In July 2020, manufacturing delays with Intel’s 10 nanometre (nm) and 7 nm chips were adversely affecting the company’s customers at a time when demand for personal computers and laptops was at its peak. Unlike its competitors, Intel was vertically integrated. Competitors such as Advanced Micro Devices, Inc. had outsourced their chip manufacturing to leading contract manufacturers such as Taiwan Semiconductor Manufacturing Company Ltd. (TSMC) and were experiencing better market capitalization growth by focusing on designing chips for PCs and other product categories. TSMC had become the leading contract manufacturer for chips globally. Intel’s former chief executive officer (CEO) believed that Intel’s chip quality was the best because its manufacturing facilities were in house. At the same time, geopolitical issues between Taiwan, the United States, and China meant that regulatory authorities in the United States were not in favour of outsourcing critical chip manufacturing. In January 2021, Intel’s newly appointed CEO would have to decide whether Intel should outsource chip manufacturing to a contract manufacturer like TSMC and whether, in the long run, Intel should remain a vertically integrated unit or spin off its manufacturing division.
學習目標
This case is intended for undergraduate- and graduate-level courses on strategic management, business strategy, or strategic marketing. After working through the case and assignment questions, students will be able to do the following:<ul></li>Explore the evolution of industry structure from vertical integration to disintegration to the possibility of reintegration.</li><li>Evaluate how a firm should make an outsourcing decision, using outsourcing decision frameworks.</li><li>Critically analyze the success factors for spinning off a manufacturing unit and remaining integrated vertically.</li></ul>