Intel's (INTC.O) new CEO, Lip-Bu Tan, is flattening the semiconductor giant's leadership team, with important chip groups reporting directly to him, according to a memo from Tan seen by Reuters.
Intel has also promoted networking chip chief Sachin Katti to be chief technology officer and artificial intelligence chief, according to the memo.
The leadership changes are the first major move under Tan, who took the top job last month, to turn around the venerable Silicon Valley chipmaker after years of problems. Intel's data center and AI chip group, as well as its personal-computer chip group, will report directly to him.
They previously were overseen by Michelle Johnston Holthaus, who remains chief executive of Intel products and whose work will expand to new areas.
"I want to roll up my sleeves with the engineering and product teams so I can learn what’s needed to strengthen our solutions," Tan wrote. "As Michelle and I drive this work, we plan to evolve and expand her role with more details to come in the future."
The shakeup by Tan, who has promised a leaner version of the storied American chipmaker, follows an extended period of turmoil at Santa Clara, California-based Intel.
The previous chief left last year following disagreements with its board of directors over how to turn the company around after years of manufacturing and product missteps. A top challenge is confronting the rise of Nvidia, which has become the dominant supplier of AI chips.
'SLOWLY SUFFOCATING' INNOVATION
Despite acquiring several AI chip startups, Intel failed to settle on a coherent strategy to challenge Nvidia, and in January shelved its most recent attempt, a chip called Falcon Shores. Developing the new AI strategy will fall to Katti.
Tan's email says Katti "is expanding his responsibilities to include the role of chief technology and AI officer for the company. As part of this, he will lead our overall AI strategy and AI product roadmap, as well as Intel Labs and our relationships with the startup and developer ecosystems."
Katti, who is also a professor at Stanford University, will succeed Greg Lavender, who is retiring from Intel, according to the memo.
Intel is looking for a new head of government affairs, who will also report to Tan, "given the critical importance of Government Affairs in a complex global environment," the CEO wrote. The predecessor, Bruce Andrews, who had worked in the Commerce Department under then-President Barack Obama, left Intel after November's U.S. elections.
The replacement will be responsible for managing Intel's relationships with governments in the U.S. and abroad at a time when President Donald Trump has put steep tariffs on China, where Tan's venture capital fund has extensive investments.
In recent years, Intel's executive team had included many business unit leaders, with technical leaders often layers below the CEO. Tan's memo said three longtime technical executives - Rob Bruckner, Mike Hurley and Lisa Pearce - will now report to Tan.
"This supports our emphasis on becoming an engineering-focused company and will give me visibility into what’s needed to compete and win," Tan wrote.
The memo follows Tan's public comments that he aimed to trim layers of management from the company so that executive leadership would work more closely with its engineers.
"It’s clear to me that organizational complexity and bureaucratic processes have been slowly suffocating the culture of innovation we need to win," Tan said in the memo. "It takes too long to make decisions. New ideas are not given room or resources to incubate. And unnecessary silos lead to inefficient execution."
