An Analysis of IT Strategy Transformation at Intel: Business Report

This report examines the IT strategy adopted by Intel, focusing on its transformation efforts. It delves into four key areas: budget management, asset and value chain management, business value management, and managing IT as a business. The report highlights strategies such as cost reduction through disruptive technologies like server virtualization and Linux, and improving customer satisfaction. It explores how Intel managed IT assets, developed IT infrastructure, and enhanced business relationships. The analysis includes how Intel managed the total cost of ownership (TCO) to drive down IT costs and measure the value of investments. Finally, the report emphasizes the importance of applying solid business practices and aligning IT outputs with enterprise goals to run IT as a value center.

Running head: IT STRATEGY
IT Strategy
[Name of the Student]
[Name of the University]
[Author note]

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Table of Contents
Introduction......................................................................................................................................2
1. Management of the budget required for IT..............................................................................2
2. Management of the Assets and value chain required for IT....................................................3
3. Management of the business values required for IT................................................................4
4. Management of the IT like a business.....................................................................................5
Conclusion.......................................................................................................................................5
References:......................................................................................................................................7

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Introduction
This is the strategy, which has been adopted by Intel for managing the budget of the
company. The management of the budget is a very crucial factor for the responsible for any type
of gain or credibility of an organisation from its business partners (Newton 2015). The main aim
of managing the IT budget is to meet the requirements of a business along with freeing up of the
resource responsible for the growth and innovation of the company. Various practices are
included in the process of taking out the costs from the IT budget, this includes the making the
components of IT support, services autonomous, the levels of services are adjusted according to
the needs, and the contracts of the suppliers are renegotiated according to the requirements. This
paper discusses about the IT strategies adopted by ‘The IT Transformation at Intel’.
Part B:
The strategies adopted by Intel for the purpose of IT transformation are described below.
The IT transformation strategy included mainly four strategies and they are:
1. Management of the budget required for IT.
2. management of the Assets and value chain required for IT.
3. Management of the business values required for IT.
4. Management of the IT like a business.
Strategies adopted by INTEL

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1. Management of the budget required for IT.
The process of reducing the costs might also include the involvement of new
technologies that are able to perform new and similar services as that of the old technologies at a
relatively low cost this is termed as disruption. Some of the technologies included in disruptive
technologies are “virtualisation of the servers” and “voice over IP” (Bloch Blumberg and Laartz
2012). The main reason for the process of managing the IT budget is to reach the “sustainable
economic model”. The two disruptive technology used by Intel were use of the Linux in the
Engineering Computing of Intel and the Redesigning of the PC Support for the employees. By
redesigning of the PC support Intel not only made the cost for support drop by $1.5 million
which was around $7million a year previously but also increased the satisfaction of the customer
by 20%. The company made use of the Linux so as to solve the demand of unsustainable demand
for IT capital expenditures.
2. Management of the Assets and value chain required for IT.
The capability of IT is made up of the IT assets and the IT value chains. The capabilities
of the IT are defined as the things that can be done for a business by the IT functions. From the
view point of the IT CMF model this capability can be seen as the production function. The
capabilities of the IT include the knowledge’s, skills, tools, process abilities and the present
motivations that are present in the IT organisations (Christopher 2016). for the purpose of
supporting and performing the various business activities. Management of the IT assets and the
IT value chains which involves in systematic management of four different aspects of the IT and
this includes IT assets. The value chains, which help in creation of the business values from the
IT, the core competencies that are involved in the delivering of the IT business values
(Acharyulu and Shekbar 2012) and the complete workflow, that goes through the complete IT

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value chain. In the year of 2000 the CEO of the company Busch had a vision of making the Intel
IT a core strategic capability for intel. This was focused on the development of three IT assets
and it included the IT infrastructure, IT people and the IT business relationships. For the purpose
of developing the IT infrastructure Intel decided to move to use of notebook computing which
was followed by the use of wireless communication for the purpose of flexible and increased
production of the workplace (Weske 2012). For the purpose of increasing the IT people asset the
people capability model was used by Intel long with this it also launched a seven step strategy
for the purpose of making Intel the company of 21st century. Lastly, for the improvement of the
IT business relationship initiative were taken by Intel to enhance the marketing organisation of
the IT and for creating management strategy for the new accounts which mainly focused on the
key customers. Several surveys were also conducted by Intel for the purpose of identifying their
flaws and to adopt new ways for the improvement and to gain more customer satisfaction.
3. Management of the business values required for IT.
The management of the values required for the IT mainly focuses on the fact of investing
decisions on the benefits that are unexpected and verification needs to be done weather this
benefits are actually being delivered or not. The IT management adopts some measures for the
purpose of realising this benefits and this includes core business practices which includes the
return-on-investment measures, firm-wide coordination of the investments being made, the
disciplines in the business case, and management of the complete portfolio and the
reprioritization (Goetsch and Davis 2014). The management of the IT business helps in the
movement of the IT from the total cost of the ownership analysis to the optimizing of the values
involved in the IT investment. The IT of Intel was able to track the Total cost ownership or TCO
of the PC’s since the year of 1995. Intel tried to focus on managing the TCO of its distributed PC

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platforms. After getting the information about the cost the company was able to take value
decisions due to availability of the financial information’s and along with this they were able to
drove down the overall IT cost. Intel was able to manage and measure the value of each group
involved (Van Der Aalst 2013) in investments rather than the value involved in individual
investments.
4. Management of the IT like a business.
Managing the IT like a business refers to the fact of running an IT organisation like a
business. The main strategies that are involved in this process are application of the solid
professional business practices in the functioning of the IT. This process also involves the
implementation of number of critical processes so as to ensure that the outputs delivered by the
IT commensurate with the goals of an enterprise (Harmon 2015). Along with this, the maturing
of the strategy will greatly help the organisations to move from being perceived so that the cost
centres are seen as the value centres having an IT business alignment at a very high level
(Schmiedelvom Brocke and Recker 2013). The main goal of Intel was to run the business by
adaptation of the standard business practices and the purposes that are involved in the
improvement of the performances, alignment and the operating efficiencies.
Conclusion
Based on the above report it can be concluded that the main part of the business plan
involved the creation of IT operations for the organisation to manage and implement the business
plans to adopt the proper business practices. New approaches were made like the product costing
and management, which was proved a fundamental in running of the business of the Intel. This
paper discussed about the aspects related to the Management of the budget, Management of the

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Assets and value chain, Management of the business values, and the management of the IT like
business.
References:
Acharyulu, G.V.R.K. and Shekbar, B.R., 2012. Role of value chain strategy in healthcare supply
chain management: An empirical study in India. International Journal of Management, 29(1),
p.91.
Bloch, M., Blumberg, S. and Laartz, J., 2012. Delivering large-scale IT projects on time, on
budget, and on value. Harvard Business Review.
Christopher, M., 2016. Logistics & supply chain management. Pearson UK.
Goetsch, D.L. and Davis, S.B., 2014. Quality management for organizational excellence. Upper
Saddle River, NJ: pearson.
Harmon, P., 2015. The scope and evolution of business process management. In Handbook on
business process management 1 (pp. 37-80). Springer Berlin Heidelberg.
Newton, P., 2015. Managing the Project Budget.
Schmiedel, T., vomBrocke, J. and Recker, J., 2013. Which cultural values matter to business
process management? Results from a global Delphi study. Business Process Management
Journal, 19(2), pp.292-317.
Van Der Aalst, W.M., 2013. Business process management: a comprehensive survey. ISRN
Software Engineering, 2013.

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Weske, M., 2012. Business process management architectures. In Business Process
Management (pp. 333-371). Springer Berlin Heidelberg.