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Otellini, Paul 1950–

Paul Otellini
1950

President and chief operating officer, Intel Corporation

Nationality: American.

Born: October 12, 1950, in San Francisco, California.

Education: University of San Francisco, BA, 1972; University of California, Berkeley, MBA, 1974.

Family: Son of David Otellini (butcher; mother's name unknown); married Sandy; children: two.

Career: Intel Corporation, 19741980, programmer, marketer, financial analyst; 19801987, account manager; 1987, general manager, peripheral components operation; 1988, operating group vice president; 1989, technical assistant to president and chief executive officer; 1990, general manager, microprocessor products group; 19911993, corporate executive officer; 19931996, senior vice president; 19961998, executive vice president, sales and marketing; 19982002, executive vice president, architecture business group; 2002, president and chief operating officer.

Address: Intel Corporation, 2200 Mission College Boulevard, Santa Clara, California 95052; http://www.intel.com.

Paul Otellini joined Intel Corporation straight out of business school and rose through the company's ranks as a result of his marketing savvy and leadership in product development. During the 1980s he cultivated a key strategic relationship between Intel and International Business Machines (IBM), and during the 1990s he presided over the development of Intel's flagship computer chip, the Pentium. Elected president and COO of Intel in 2002, Otellini became second in command of the world's leading producer of microprocessors.

EARLY LIFE AND EDUCATION

Born and raised in San Francisco, California, Otellini grew up in a working-class Italian American family with deep roots

in the Bay Area. He began working at an early age, delivering newspapers while in grammar school and stocking shelves and selling suits at a men's clothing store while in high school. As a child Otellini took an interest in chemistry and mathematics. His lack of engineering ability, however unusual among Intel executives, was reflected in a humorous anecdote from his adolescence. While swinging from an ill-designed pulley system constructed with his brother and cousin, he plunged into a rocky bluff near Lake Tahoe.

Otellini's devoutly Catholic father urged his sons to join the priesthooda call that Otellini's brother heeded. Otellini resisted, instead attending the University of San Francisco, a Jesuit institution. As an undergraduate Otellini developed an interest in finance and majored in economics. He completed his degree in 1972 and enrolled in the business school at the University of California, Berkeley, where he studied finance and earned a master of business administration degree in 1974.

JOINS INTEL AND MANAGES IBM ACCOUNT

With his formal education behind him, Otellini sought employment in the burgeoning computer technology industry in Silicon Valley, then a mostly agricultural region south of San Francisco. Otellini considered Fairchild Semiconductor and Advanced Micro Devices but ultimately choose Intel, the semiconductor company founded in 1968 by the computer pioneers Robert Noyce and Gordon Moore. In 1971 Intel introduced the world's first microprocessor, a powerful miniature circuit that revolutionized computing by integrating and rapidly speeding up multiple information-processing functions.

Hired in 1974 Otellini began working in the finance department, where he programmed a cost system for the company on a primitive computer. During the next six years Otellini was involved in various finance and marketing roles related to Intel's new microprocessor division. In 1980 he was placed in charge of Intel's account with IBM, at the time Intel's largest customer of memory, rather than microprocessor, products. Otellini persuaded IBM to use Intel's microprocessors in its new computers, a sales triumph with tremendous consequences. The world's first personal computer, introduced by IBM in 1981, was powered by an Intel microprocessor. Over the next two decades Intel's chips would serve as the brains behind IBM's groundbreaking 286, 386, 486, and 586 series computers.

RISE TO TOP MANAGEMENT

In 1987 Otellini advanced as general manager of the peripheral components operation and was sent to manage Intel's new plant in Folsom, California. During this time he was recognized as an inspiring leader for his compassion in handling grief-stricken workers in the wake of two unrelated employee suicides within a six-month period. Otellini brought in counselors and personally engaged employees at the plant, exhibiting a gentle strength that impressed the Intel president, Andrew Grove.

In 1988 Otellini was promoted to operating group vice president, and in 1989 he served as technical assistant to Grove, who sought to groom Otellini for a top management position. In 1990 Otellini was tapped to head Intel's microprocessor products group, which included managing the development of the Pentium chip. Although harried by minor calculating glitches on its release in 1993a public relations crisis that Otellini successfully weatheredthe Pentium set the standard for fifth-generation, or 586, microprocessors and became one of the most recognized trademarks in the world.

Otellini was named a corporate executive officer at Intel in 1991 and, with the launch of the Pentium, advanced to senior vice president in 1993 and executive vice president in 1996. In 1998 he was placed in charge of the Intel Architecture Group, taking on overall responsibility for Intel's $21 billion microprocessor business, which accounted for 80 percent of Intel's total business.

PRESIDENT AND COO OF INTEL

After 28 years at Intel, Otellini was elected president and COO of the company in 2002. The move signaled that Otellini was Intel's heir apparent, because the company's presiding chief executive officer, Craig R. Barrett, then 62 years old, was three years away from the company's mandatory retirement age. Otellini's ascendance was presumed to represent the first stage of a gradual succession plan in which Barrett and Otellini shared leadership of the company. Barrett focused on Intel's broad corporate strategy, and Otellini continued to oversee internal operations such as product development and manufacturing.

Otellini assumed the presidency in a year that Intel reported precipitous financial losses as the personal computer market matured and Intel's efforts to diversify its business in consumer electronics and web-hosting ventures failed to meet expectations. Otellini, who viewed himself as a "product guy" despite his lack of engineering credentials, helped turn the company back toward its core business in silicon microprocessors. Instead of merely working to produce faster chips, Otellini touted the importance of developing multifunctional chips with integrated communication features and reduced external power requirements. New products such as the Centrino laptop chipset, introduced in 2003, and Intel's XScale processors, used in an array of handheld devices such as personal digital assistants, mobile phones, and MP3 players, embodied Otellini's vision of lightweight, highly mobile technology.

Otellini's success as an executive was attributed to his superior marketing ability and light touch as a manager. He motivated rather than dictated. In contrast to Barrett, who reportedly wielded a baseball bat at meetings, Otellini was soft-spoken and encouraged his subordinates to push themselves through his own quiet confidence, described by Cliff Edwards of BusinessWeek as "Zen-like." Otellini's appointment as Intel's president, which came at a time when the company was attempting to reposition itself as the world's premier chipmaker, reflected the respect with which he was viewed by Intel insiders as a tested leader and pitchman.

See also entry on Intel Corporation in International Directory of Company Histories.

sources for further information

Clark, Don, "Intel Promotes Veteran Paul Otellini to President, Chief Operating Officer," Wall Street Journal, January 17, 2002.

Detar, James, "Pervasive Intelligence: Pervasive Intel Networks That Can 'Think'," Investor's Business Daily, November 29, 2002.

Edwards, Cliff, "No Nerd at the Top? Heresy! Intel's CEO-in-Waiting, Paul Otellini, Is a Master Marketer," BusinessWeek, November 4, 2002, p. 78.

Kirkpatrick, David, "At Intel, Speed Isn't Everything," Fortune, February 9, 2004, p. 34.

Morrow, Daniel S., "Paul Otellini Oral History," Computerworld Honors Program International Archives, April 30, 2003, http://www.cwheroes.org/oral_history_archive/paul_otellini/Otellini.pdf.

Taylor, Chris, "The Salesman of Silicon Valley: Paul Otellini," Time, December 1, 2003, p. 75.

Josh Lauer

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