Premium Essay

The Intel Pentium Chip Controversy

In: Business and Management

Submitted By pejmanndc
Words 1710
Pages 7
Case Analysis: The Intel Pentium Chip Controversy (A)

Immediate Issue: As Andrew Grove, during my meeting of December 17,1994 with my internal team, Should I approve replacing the defective Intel chips of all concerned users with no-question asked? Also, should we also pay for the labor and other incidental costs? How should we integrate our decision into our financial books?

Basic Issues:

• Negative Publicity: Since Oct 30th, we have encountered a self-propelled negative publicity campaign against Pentium brand and it doesn’t seem to fade away if we don’t do anything.

• Business Ethics: We knew this problem since October, but tried to hide it with the hope that it will fade away. We will be scrutinized from an ethical perspective.

• Cost of my decision: How much would it cost to replace the defective chips (fully or partially)? How much would it cost if I do nothing?

• Risks and Liabilities: Some of our chips are being used by large engineering firms, financial industry, research firms and educational institutes. Is there a chance that we may be sued for damage to our users? What if our chips are used in a space program?

• Role of the Internet: The pace at which it went from a simple technical report by Dr. Nicely to a full fledge all media campaign against Pentium within a short period of time emphasizes to me that I can’t underestimate the power of internet.

• Major players in the market: Nothing hurt us more than IBM announcement to drop Pentium. Who else in the market has the same power? How should we deal with such players

• Pentium brand: We have invested hugely on this brand. Is it an asset or liability for us?

• Corporate Image: Intel is the Mercedes Benz of the processor industry. This is one our most precious assets.

• Market and Shareholder’s reaction / Stock Price: How would market react to our decision?

Similar Documents

Free Essay

Intel

...Subject: Date: Andrew Grove, PhD – President and CEO of Intel Corporation FT50812 Intel Pentium Chip Controversy December 17, 1994 Summary Intel’s reputation as a producer of quality microprocessors is being questioned. Public perception views Intel as insensitive to consumer concerns and overly profit driven. The investments Intel has made in the Pentium chip to secure a competitive advantage will be pointless if consumers lose trust in the Intel brand. Analysis of Issues Intel’s dilemma is whether to recall a product that is defective under certain conditions (p. 2).1 This decision requires consideration of the financial and operational issues, as well as the potential long-term impact to Intel’s competitive advantage in the computer industry and Intel’s relationships with companies that purchase microprocessors. These issues are further described below. Competitive Advantage The new Pentium chip is the embodiment of Intel’s advantage over other companies. Intel has the distinction of being first in the industry to engineer and produce microprocessors (p. 2). In addition, Intel has made significant investments in research and development to design the Pentium, has incurred significant expenditure in promotions, and has secured its investment with a name-based patent (p. 3). 1 All page numbers referenced herein are drawn from the following case study: Narayanan, V.C. (2002). The Intel Pentium Chip Controversy (A). Harvard Business School. 9-196-091. 1 Computer...

Words: 1344 - Pages: 6

Free Essay

Sikila7La7

...Which one is better? - RISC vs CISC is a topic quite popular on the Net. Everytime Intel (CISC) or Apple (RISC) introduces a new CPU, the topic pops up again. But what are CISC and RISC exactly, and is one of them really better? This article tries to explain in simple terms what RISC and CISC are and what the future might bring for the both of them. This article is by no means intended as an article pro-RISC or pro-CISC. You draw your own conclusions … CISC Pronounced sisk, and stands for Complex Instruction Set Computer. Most PC's use CPU based on this architecture. For instance Intel and AMD CPU's are based on CISC architectures. Typically CISC chips have a large amount of different and complex instructions. The philosophy behind it is that hardware is always faster than software, therefore one should make a powerful instructionset, which provides programmers with assembly instructions to do a lot with short programs. In common CISC chips are relatively slow (compared to RISC chips) per instruction, but use little (less than RISC) instructions. RISC Pronounced risk, and stands for Reduced Instruction Set Computer. RISC chips evolved around the mid-1980 as a reaction at CISC chips. The philosophy behind it is that almost no one uses complex assembly language instructions as used by CISC, and people mostly use compilers which never use complex instructions. Apple for instance uses RISC chips. Therefore fewer, simpler and faster instructions would be better, than the large...

Words: 1125 - Pages: 5

Free Essay

Cisc vs. Risc.

...Abstract: This term paper presents two instructions set architectures, particularly the CISC and the RISC, which have been developed as computer architects aimed for a fast, cost-effective design. Included in this paper are the arguments made for each architecture, and of some performance comparisons on RISC and CISC processors. These data are collected from various papers published concerning the RISC versus CISC discussion. INTRODUCTION: The advent of microprocessor and strides in integrated circuit technology improved the performance of computer system at roughly 35% per year. Mass production of lower cost microprocessors has increased the share of microprocessor based computer in the market. This new architecture of microprocessor based computers has become a true success after two major changes in computer marketplace. One is elimination of programming at the assembly language level which eliminated the need for object-code compatibility. So any architecture could reuse the source code written in higher level languages. The second is the creation of standardized vendor-independent operating systems like UNIX and its clones like Linux which lowered the cost and risk of bringing out a new architecture. The open standard of systems eased the new computer architecture introduction. The above improvements helped evolve computer architecture from general microprocessor based architecture to a new set of architectures called RISC architectures. RISC stands for Reduced...

Words: 2342 - Pages: 10

Free Essay

Managing the Crisis You Tried to Prevent

..... Managing Crisis You Tried to Prevent Norman R. Augustine Originally published in November – December 1995 Reprint # 95602 A Harvard Business Review Paperback Managing the Crisis You Tried to Prevent Managing the Crisis You Tried to Prevent Norman R. Augustine Executive Summary NEWS REPORTS ANNOUNCING that yet another business has stumbled into a crisis—often without warning and through no direct fault of its management— seem as regular as the tide. And the spectrum of business crises is so wide that it is impossible to list each type. On a single day this year, the Washington Post reported a series of crashes suffered by American Eagle Airlines, the bankruptcy of Orange County, and Intel’s travails with its Pentium microprocessor. Other noteworthy crises have been the Challenger space shuttle explosion, the “incident” at the Three Mile Island nuclear reactor, and the series of deaths resulting from cyanide adulteration of Tylenol capsules. Fortunately, argues Norman Augustine, almost every crisis contains within itself the seeds of success as well as the roots of failure. Finding, cultivating, and harvesting that potential success is the essence of crisis management. And the essence of crisis mismanagement is the propensity to take a bad situation and make it worse. Augustine has distinguished six stages of crisis management and makes recommendations for dealing with each: avoiding the crisis, preparing to manage the crisis, recognizing the...

Words: 8659 - Pages: 35

Premium Essay

Role of Social Media

...Role of social media Social media plays an essential role in our daily life. When it comes to the problem that if people should keep records or experiences by exposing photos on social networking sites, their opinions vary from person to person. In the following paragraphs, this popular controversy will be addressed as both position is thoroughly analyzed. The invention of social media has pulled people together, building strong social connections, making the world smaller, and enabling people to share their happiness with others. Social networking is also a good way to meet friends of diverse backgrounds. Take Instagram as an example. It recommends posts or users based on your interests, likes and other factors, allowing people to find those who share the same interests as them, thus broadening their friends circle and providing future convenience. From Erik Quaiman’s “Socialnomics: how social media transforms the way we live and do business”, the author states that social media touches nearly every factor of our personal and business lives. The rhetor uses statistics and emotional appeals to illustrate the importance of social media. For instance, “Over 7 million views of their YouTube videos, 750,000 views of their Flickr photos, more than 125,000 hand-raisers on FiestaMovement.com, 11,000 vehicle reservations and an awareness rate of 60 percent-equal to that of vehicles that have been in the market for two to three years. All through social media”(Erik Quaiman, 1)....

Words: 1154 - Pages: 5

Premium Essay

Computer Organization and Architecture Designing for Performance 8th Edition

...COMPUTER ORGANIZATION AND ARCHITECTURE DESIGNING FOR PERFORMANCE EIGHTH EDITION William Stallings Prentice Hall Upper Saddle River, NJ 07458 Library of Congress Cataloging-in-Publication Data On File Vice President and Editorial Director: Marcia J. Horton Editor-in-Chief: Michael Hirsch Executive Editor: Tracy Dunkelberger Associate Editor: Melinda Haggerty Marketing Manager: Erin Davis Senior Managing Editor: Scott Disanno Production Editor: Rose Kernan Operations Specialist: Lisa McDowell Art Director: Kenny Beck Cover Design: Kristine Carney Director, Image Resource Center: Melinda Patelli Manager, Rights and Permissions: Zina Arabia Manager, Visual Research: Beth Brenzel Manager, Cover Visual Research & Permissions: Karen Sanatar Composition: Rakesh Poddar, Aptara®, Inc. Cover Image: Picturegarden /Image Bank /Getty Images, Inc. Copyright © 2010, 2006 by Pearson Education, Inc., Upper Saddle River, New Jersey, 07458. Pearson Prentice Hall. All rights reserved. Printed in the United States of America. This publication is protected by Copyright and permission should be obtained from the publisher prior to any prohibited reproduction, storage in a retrieval system, or transmission in any form or by any means, electronic, mechanical, photocopying, recording, or likewise. For information regarding permission(s), write to: Rights and Permissions Department. Pearson Prentice Hall™ is a trademark of Pearson Education, Inc. Pearson® is a registered trademark of...

Words: 239771 - Pages: 960

Premium Essay

Computer

...A BRIEF COMPUTER HISTORY The computer as we know it today had its beginning with a 19th century English mathematics professor name Charles Babbage. He designed the Analytical Engine and it was this design that the basic framework of the computers of today are based on. Generally speaking, computers can be classified into three generations. Each generation lasted for a certain period of time,and each gave us either a new and improved computer or an improvement to the existing computer. First generation: 1937 – 1946 - In 1937 the first electronic digital computer was built by Dr. John V. Atanasoff and Clifford Berry. It was called the Atanasoff-Berry Computer (ABC). In 1943 an electronic computer name the Colossus was built for the military. Other developments continued until in 1946 the first general– purpose digital computer, the Electronic Numerical Integrator and Computer (ENIAC) was built. It is said that this computer weighed 30 tons, and had 18,000 vacuum tubes which was used for processing. When this computer was turned on for the first time lights dim in sections of Philadelphia. Computers of this generation could only perform single task, and they had no operating system. Second generation: 1947 – 1962 - This generation of computers used transistors instead of vacuum tubes which were more reliable. In 1951 the first computer for commercial use was introduced to the public; the Universal Automatic Computer (UNIVAC 1). In 1953 the International Business Machine (IBM)...

Words: 7002 - Pages: 29

Free Essay

The Nanarene Way of Essenic Studies

...the antichrist will exercise power over the earth, during the period known as the Tribulation in the book of Revelation. Opinions as to what form it will take are varied. The literal interpretation is that the number 666 will be imprinted on the skin, but with recent technological developments the possibilities of universal control are limitless. The notion that the mark is required for all commerce implies that the mark might actually be a special card, or that we might have to have our fingerprints scanned into a worldwide database in order to be recognized in business. Or, the mark might be some kind of smart chip implanted into the body. In Revelation 14:9-12, the third angel warns of wrath and retribution to all those who bear this mark on their heads or hands. The number 666, which supposedly represents the name of the Antichrist, is another source of controversy. There are various theories about the meaning of this verse, and there have been many attempts to show that a person is the Antichrist by relating his name to the number 666. One interpretation is simply that 666 represents humankind in general because of the special significance that the number has in the Bible. Six is known as an "imperfect number" because it is one short of seven, the "perfect number" (seven days in the week, seven tongues of flame, seven spiritual gifts...). So three (the number of the Trinity) sixes is seen as extremely imperfect. Therefore, 666 represents...

Words: 4466 - Pages: 18

Free Essay

The Nanarene Way of Essenic Studies

...the antichrist will exercise power over the earth, during the period known as the Tribulation in the book of Revelation. Opinions as to what form it will take are varied. The literal interpretation is that the number 666 will be imprinted on the skin, but with recent technological developments the possibilities of universal control are limitless. The notion that the mark is required for all commerce implies that the mark might actually be a special card, or that we might have to have our fingerprints scanned into a worldwide database in order to be recognized in business. Or, the mark might be some kind of smart chip implanted into the body. In Revelation 14:9-12, the third angel warns of wrath and retribution to all those who bear this mark on their heads or hands. The number 666, which supposedly represents the name of the Antichrist, is another source of controversy. There are various theories about the meaning of this verse, and there have been many attempts to show that a person is the Antichrist by relating his name to the number 666. One interpretation is simply that 666 represents humankind in general because of the special significance that the number has in the Bible. Six is known as an "imperfect number" because it is one short of seven, the "perfect number" (seven days in the week, seven tongues of flame, seven spiritual gifts...). So three (the number of the Trinity) sixes is seen as extremely imperfect. Therefore, 666 represents...

Words: 4476 - Pages: 18

Free Essay

History of Information Technolyge

...North South University Department of Electrical Engineering & Computer Science ETE 521 Assignment # 3 Name: MD. Rakibul Islam Monshy ID: 1131048556 a) No Ans: Define ILEC: An incumbent local exchange carrier (ILEC) is a local telephone company in the United States that was in existence at the time of the breakup of AT&T into the Regional Bell Operating Companies (RBOCs), also known as the "Baby Bells." The ILEC is the former Bell System or Independent Telephone Company responsible for providing local telephone exchange services in a specified geographic area. GTE was the second largest ILEC after the Bells, but it has since been absorbed into Verizon, a RBOC. ILECs compete with competitive local exchange carriers (CLEC). When referring to the technical communities ILEC is often used just to mean a telephone provider. In Canada, the term ILEC refers to the original telephone companies such as Telus (BC Tel and AGT), SaskTel, Manitoba Telephone Systems (MTS Allstream), Bell Canada Enterprises and Aliant. ILEC, with respect to an area in the United States, is a local exchange carrier (LEC) that: On the date of enactment of the Telecommunications Act of 1996, provided telephone exchange service in such area and on such date of enactment, was deemed to be a member of the exchange carrier association pursuant to the Code of Federal Regulations (C.F.R) Title 47, section 69.601(b).Or is a person or...

Words: 13049 - Pages: 53

Premium Essay

Heuy2Kj4

...the essentials of Linda Null and Julia Lobur JONES AND BARTLETT COMPUTER SCIENCE the essentials of Linda Null Pennsylvania State University Julia Lobur Pennsylvania State University World Headquarters Jones and Bartlett Publishers 40 Tall Pine Drive Sudbury, MA 01776 978-443-5000 info@jbpub.com www.jbpub.com Jones and Bartlett Publishers Canada 2406 Nikanna Road Mississauga, ON L5C 2W6 CANADA Jones and Bartlett Publishers International Barb House, Barb Mews London W6 7PA UK Copyright © 2003 by Jones and Bartlett Publishers, Inc. Cover image © David Buffington / Getty Images Illustrations based upon and drawn from art provided by Julia Lobur Library of Congress Cataloging-in-Publication Data Null, Linda. The essentials of computer organization and architecture / Linda Null, Julia Lobur. p. cm. ISBN 0-7637-0444-X 1. Computer organization. 2. Computer architecture. I. Lobur, Julia. II. Title. QA76.9.C643 N85 2003 004.2’2—dc21 2002040576 All rights reserved. No part of the material protected by this copyright notice may be reproduced or utilized in any form, electronic or mechanical, including photocopying, recording, or any information storage or retrieval system, without written permission from the copyright owner. Chief Executive Officer: Clayton Jones Chief Operating Officer: Don W. Jones, Jr. Executive V.P. and Publisher: Robert W. Holland, Jr. V.P., Design and Production: Anne Spencer V.P., Manufacturing and...

Words: 118595 - Pages: 475

Free Essay

Norton Lilly

...When an icon stumbles: the Ribena issue mismanaged Tony Jaques RMIT University, Melbourne, Australia Abstract Purpose – When two 14-year-old New Zealand schoolgirls challenged the advertising claims of Ribena blackcurrant drink – owned by global giant GlaxoSmithKline – they triggered a sequence of events which led to prosecution, public opprobrium and international damage to an iconic brand. The purpose of this paper is to explore the case and identify lessons for future management practice. Design/methodology/approach – Some of the fundamental principles of issue management, post-crisis discourse and corporate apologia are to recognize the problem early, to promptly institute a strategic response plan and corrective action and, if necessary, to apologise genuinely and without delay. The paper assesses the case against the theoretical basis of each of these principles and comparable cases. A senior executive of the company concerned was interviewed about some management aspects. Findings – Despite early indications of a problem which had potential impact around the world, a major global corporation responded inadequately to a local situation and, as a result, suffered prolonged embarrassment at the hands of two teenagers and unnecessarily severe damage to its brand and international reputation. Originality/value – By in-depth...

Words: 2893 - Pages: 12

Premium Essay

Matha Stewart Lost Reputation

...International Journal of Humanities and Social Science Vol. 1 No. 15 [Special Issue – October 2011] A Corporate Hero with Scandal: Lessons Learned from Martha Stewart’s Insider Trading Crisis Shuhui Sophy Cheng Assistant Professor Department of Communication Arts Chaoyang University of Technology 168 Jifeng E. Rd. Wufeng District Taichung 41349, Taiwan Abstract Martha Stewart places her name on her products. She becomes the face of her company and the voice of her brand. When her personal misconduct occurred, she made her company vulnerable and risky as well. This casestudy examines how Martha Stewart managed her corporate communication when her public image and reputation were tarnished on trial for alleged insider trading scandal. The trial not only led her to prison but also hurt her brand equity. The study shows that Stewart’s early response to her crisis demonstrated lack of situation awareness. In the beginning of her investigation, she kept her public persona intact, ignoring or downplaying her role in it. As a result, what Stewart called “a small personal matter” later became a full-blown crisis. If she had managed her communication in a more timely manner, the magnitude of her crisis might have been minimized. This article also provides detailed insights for organizations to learn from her crisis response strategies. Keywords: Organizational crisis, Crisis communication, Image restoration 1. Introduction The personalities of strong business leaders can help...

Words: 9481 - Pages: 38

Premium Essay

Term Paper

...John Paul G. Cordova ME2-1 “Today’s Computers: How Did They Evolve?” I. Introduction A. Background of the Topic - The topic, entitled “Today’s Computers: How Did They Evolve?”, just like the life of a person, also has its own backgrounds, from the simplest form to its complex form. In other words, computers of today have their own histories. As I continue this term paper, you will be discovering the history behind the evolution of computers. B. Importance of the Topic - This topic is important to be known by the community because computers are very useful nowadays. As a student, knowing the story behind the evolution of computers is important in order for me to understand the computers more efficiently. For teachers, it is also important for them to know the history behind the evolution of computers because they also use computers in order to finish their jobs more accurately, making them aware of the computer’s history. II. Body of the Document A. Evolution of Computer in the late 16th century, the 18th century, and the early 19th century: 1. “Abacus was the first counting device, which is originally made from Asia. It worked on a place-value notion meaning that the place of a bead or rock on the apparatus determined how much it was worth. During the 1660s, John Napier discovered logarithms. Robert Bissaker invented the slide rule which will remain in popular...

Words: 14119 - Pages: 57

Premium Essay

Blackmore's Five Forece Analys

...The current issue and full text archive of this journal is available at www.emeraldinsight.com/1356-3289.htm CCIJ 13,4 When an icon stumbles: the Ribena issue mismanaged Tony Jaques RMIT University, Melbourne, Australia Abstract Purpose – When two 14-year-old New Zealand schoolgirls challenged the advertising claims of Ribena blackcurrant drink – owned by global giant GlaxoSmithKline – they triggered a sequence of events which led to prosecution, public opprobrium and international damage to an iconic brand. The purpose of this paper is to explore the case and identify lessons for future management practice. Design/methodology/approach – Some of the fundamental principles of issue management, post-crisis discourse and corporate apologia are to recognize the problem early, to promptly institute a strategic response plan and corrective action and, if necessary, to apologise genuinely and without delay. The paper assesses the case against the theoretical basis of each of these principles and comparable cases. A senior executive of the company concerned was interviewed about some management aspects. Findings – Despite early indications of a problem which had potential impact around the world, a major global corporation responded inadequately to a local situation and, as a result, suffered prolonged embarrassment at the hands of two teenagers and unnecessarily severe damage to its brand and international reputation. Originality/value – By in-depth analysis of a recent case...

Words: 6368 - Pages: 26