Silicon Insider: Intel, Buy Texas Instruments

But in studying the history of Intel, I suddenly saw all in one place all the mistakes that I had only noticed piecemeal and had written off at the time as momentary aberrations: the company's near decision not to pursue semiconductors; the overinvestment that almost led to bankruptcy in the early '80s, the hanging on to the memory business until it was almost too late; the endless wasteful lawsuit with AMD; the falling almost fatally behind Motorola in the '70s, the Pentium Bug; the vicious straight-arming of customers in the late '90s that led to a Justice Department investigation … etc., etc.

Any one of these mistakes could have (and indeed, had) killed or crippled other great companies. Yet Intel had not only survived them all but thrived, eventually coming as close as legally possible to enjoying ownership of one of the most lucrative businesses ever devised.

What was the difference? Certainly Intel had been able to recruit top talent for three decades. And its x86 processor architecture has proved incredibly durable. Finally, the unmatched reputations of the company's two founders, Gordon Moore and the late Bob Noyce, certainly helped get the company through hard times when customers might have bailed. But not one of those factors was sufficient. No, I realized it was something else: the leadership of Andy Grove.

Was It the Man or the Company?

Grove has long been celebrated as one of the greatest business leaders of the last half century. He was even Time's Man of the Year. And yet, there has always been the sneaking suspicion that his reputation had a lot to do with the company he led, and that any moderately competent executive could successfully run a company holding the cards Intel did.

But I came to realize that the truth was exactly the opposite: Intel appeared a great company precisely because Andy Grove ran it. Every time the company stumbled, Grove was there to pick it up by the collar and kick it in the butt. That was impressive enough, but the real jaw-dropping moments in Intel's history came when it was Grove himself who screwed up … then did a complete turnaround and rectified his own mistake, even at the cost of public humiliation.

It was Grove, after all, who hung on too long to Intel's memory business -- then dumped it and devoted all his energies to processors. It was Grove who, on learning of the Pentium bug, chose to insult company customers … then turned around in 72 hours and drove the company to make sweeping fixes. And it was Grove who led the company to the brink of a Justice Department investigation … and who (unlike the foolish Bill Gates) did a quick mea culpa and probably saved his company.

There were a lot of things not to like about Andy Grove's management style. I couldn't have worked for the man for more than two days. He was relentlessly competitive, arrogant, vindictive and uncompromising. But that is what it took to make Intel the great company it was. And nobody was more loyal to Intel than Andy Grove. I once wrote something cruelly funny about Intel, and Andy didn't speak to me for 10 years. That was Andy, and that's why he was the best.

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