Only the paranoid survive

Andy Grove 

I picked this up in the Foreign Language Bookshop in Yan An Rd in early April. Its a very interesting read, not least for Mr Grove's highlighting of the phenomemon of 'The Strategic Inflection Point' but also for his observations on the way change happens in a large organisation. What Grove calls the 'SIP' others probably would call a 'Paradigm Shift' although maybe the PS is the mental correlate of the external environment undergoing a SIP.

What I found noteworthy was the way Grove describes Intel's transition from being a memory company to being a micro company - it actually occurred long before the conscious decision to 'get out of memory'. Grove documents this but doesn't highlight this (to me) very important observation. What he says is that the actions of the production planners made the transition from 'memory' to 'processor' easier - he doesn't venture the view that those production planners actually instigated the defacto change of emphasis. As the CEO, he seems convinced that its the dejure change which matters. I'm not convinced - which is more important - that Intel says its getting out of memory, or that its behaviour shows that it is? This sequence echoes the Benjamin Libet experiments on human consciousness - in that Libet found empirically that a decision is made at an unconscious level before awareness of the decision -  he found that awareness lagged behind action by a few hundred milliseconds.

So the organisation is an organism - the strategic decision by Andy Grove to become a micro company was merely the acknowledgement of a transition already almost completed in behavioural terms - he mentions that 5 out of 6 fabs were already turned over to micro production at the point he let go of the self-definition of Intel as a memory company. His own awareness lagged behind the behaviour of his company by many months ! So much for 'command and control'... Local intelligence responding to local environmental conditions achieved the transformation, not top down executive decision making. 

Andy Grove's introduction in the book

Perhaps Andy isn't using 'paranoid' in the strict psychological sense - that of seeing negativity in the world and sucking it in to understand it as me-directed. Yet he says things which sound classically paranoid. Take this phrase 'the more successful you are, the more people want a chunk of your business, then another chunk... until there's nothing left' And how's this 'I believe the prime responsibility of the manager is to guard constantly against other people's attacks...'. The PRIME responsibility for a manager is not towards her own workers, but directed towards protecting against other people's hostility ? This IS paranoia in the psychological sense - seeing the world as fundamentally hostile, and primarily the hostility is me-directed. These are the two fundamental distortions of the paranoid mind-set.

Yet if the book was simply the paranoid delusions of a CEO, it wouldn't be so interesting. So there's this inconsistency in that when Grove gets to unpack his philosophy its far from being so strongly paranoid. If it were, he'd be focussing on the suspected intentions of his competitors and how to thwart their devious plans of attack. He spends very little time in the book trying to outwit the Japanese evil memory empire but rather focusses on how Intel might survive and even prosper in the 10X world. So the whole book is not as competitor-focussed as the title might incline you to believe but rather gives plenty of insights into Intel's management deliberations.

Intel is often cited as one of the 'enlightened' companies in the world - flat, non-hierarchical structures, individual employee empowerment, devolved decision making, encouragement of dissent within the ranks, transparency of decision making and the like. What's odd is that the public face is not at all that - from sources such as the Inq, we get the impression of a culture of denial and misinformation. We get the stories of co-dependent customer relationships ( Dell being one such example ) and we get a picture of considerable internal politics - the decision making around the development and launch of the P4 coming to mind. Why was the P4 such a backward step at its introduction ? Why does Intel modify the benchmark suite to favour its own product and then deny it has done such a thing. The list goes on, so its a puzzle. Whilst Andy Grove espouses quite a lot of more enlightened ideas, its clear that the behaviour of certain departments in the company is a long way from embracing transparency and honesty.