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Industry screw-ups of 2011

Posted: 27 Dec 2011 ?? ?Print Version ?Bookmark and Share

Keywords:electronics supply chain? electronics market? consumer electronics?

8. AMD's CEO search saga
Did Advanced Micro Devices Inc.'s board of directors commit a blunder when it forced CEO Dirk Meyer to resign in early January? That depends on your point of view.

But the blunder here from our perspective was the process of identifying Meyer's replacementa seemingly perpetual CEO search that spanned more than seven months and reportedly included overtures to longtime Intel Corp. exec Pat Gelsinger, Apple Inc. COO Tim Cook, former Hewlett Packard Co. CEO Mark Hurd and Carlyle Group Managing Director Greg Summe, all of which reportedly turned AMD down.

Dirk Meyer

Some believe that Meyer was asked to resign because AMD was not able to move quickly enough to offer products for the tablet market.

AMD's board and acting-CEO Thomas Seifert said over and over that it was more important that the board identify the right candidate than fill the vacancy by a set date. It's hard to argue with that logic. Still, more than seven months without a permanent chief executive at the helm is no one's idea of a good strategy. AMD is very likely the only electronics firm of any significance that spend the majority of 2011 without a permanent CEO.

To AMD's credit (and Seifert's), the sky didn't fall with nobody sitting in the corner office. The company did brisk business through much of the year, with one Wall Street analystCraig Berger of FBR Capital Marketspredicting that AMD was poised to pick up a few points of market share at old buddy Intel's expense. It was only later in the year that AMD's sales started to slip, and that was largely blamed on manufacturing yields at AMD's foundry partner, Globalfoundries (more on that later).

But even as AMD continued to perform for much of 2011, important long-term strategy decisions presumably remained on hold, pending a new leader. Considering that one knock against AMD was that it hadn't moved�quickly enough to offer products for the suddenly red hot tablet market (some believe that is why Meyer was shown the door), the extra delay couldn't have helped. Wall Street analysts complained that the lack of a permanent CEO was dragging on AMD's stock price and hurting the image of the company.

AMD finally put the matter to rest in late August, when it named Rory Read, a longtime IBM exec who had most recently been president and chief operating officer at Lenovo Group, the company's new president and CEO. To the relief of many, Read quickly got to work laying the groundwork for AMD's new strategic direction (although those many probably do not include the 1,400 workers AMD let go in November, in Read's first major move).

C Dylan McGrath

7. RIM nixes Java
Research in Motion Ltd announced earlier this year it will unify its Blackberry, Playbook and QNX embedded operating systems sometime in 2012, but the resulting BBX environment will not support the custom Java APIs that are the basis of today's Blackberry smartphone applications.

Time will tell whether or not this is a bonehead move. At the very least it's a questionable gamble and one that RIM did not communicate clearly and broadly at its developer conference in San Francisco.


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