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Case II-12: Intel Corporation: The DRAM Decision

Part #1: What have you learned from the case with regards to business and technology strategy?

The case focuses on the Strategic Business Exit (SBE) of Intel Corporation and analyzing key choices of upper management, and their decisions to have a high tech firm exit from one of its core businesses in a competitive industry, and enter a new one. Also showing Intel's' Corporation's departure from the Dynamic Random Access (DRAM), which was its main business core. This showed to be a very risky, but very beneficial for saving some of its other important competencies, such as an aggressively growing microprocessor business. Another important topic is the Process Model of the SBE. The process identifies the patterns of upper management, and the choices which help explain how they came to determine what might be necessary for future growth, and success.

Part #2: Identify the Terminal Course Objectives (TCOs) that are applicable to this case and discuss the reasons that support your position.

In context to Intel, and their decisions to exit the DRAM business, they were able to recognize that their core competency was getting strong competition from Japanese manufactures. They had to make choices quickly to reorganize and restructure technological competencies. These choices were critical connections with its corporate, technology, marketing and manufacturing strategies. Upper management was able to recognize that the industry was making changes, and Intel was able to adjust its competencies accordingly. The organization's managers were able to identify that the technological competencies were not being considered yesterdays news, rather that the product market was changing. The development of new competencies, and synergies with microprocessors, has established a new foundation for today's Intel.

The strategy here was not staying in a risky core product race, with profits dropping rapidly. They had to recognize that products like EPROM's and SRAM together were becoming cutting edge technology, and a foundation of Intel's' Core products. Logic products built on microprocessor technology have replaced memory products as Intel's core business. Also "internal selection environments"