By John Kell and Alan Murray
March 22, 2016

In 1985, Andy Grove was president of Intel, working with CEO Gordon Moore. The company had created the memory chip industry, cramming ever more transistors into small chips in accordance with Moore’s now-famous law. But it was watching fast-moving Japanese competitors do the same, commoditizing the business. Profits plunged from $198 million in 1984 to less than $2 million in 1985.

As Grove recounted in his book, Only the Paranoid Survive, he and Moore had been agonizing for weeks over the crisis when something hit him. “I turned to Moore and I asked: ‘If we got kicked out and the board brought in a new CEO, what do you think he would do?’ Gordon answered without hesitation, ‘He would get us out of memories.’ I stared at him, numb, then said, ‘Why shouldn’t you and I walk out the door, come back, and do it ourselves?’”

And that’s what they did, leaving memory chips behind, shifting to microprocessors, and positioning Intel for decades of new growth. Grove was able to divorce himself from the daily struggle and see that, in order to save the business, he had to give it up. In doing so, he laid the foundation not only for the modern computer industry, but for modern management. The mantra? Don’t protect the past. Don’t let a product define your business. Always disrupt yourself.

Grove died yesterday at 79. He will be sorely missed, but not forgotten. You can read tributes from my colleagues Norman Pearlstine and Adam Lashinsky here and here.

Separately, if you could rebuild the energy industry from scratch, what would it look like? That’s a question at the core of our Brainstorm E conference, being held in Carlsbad, California, on May 16. The gathering will include the smartest people we know at the intersection of energy and technology, including Ford Executive Chairman Bill Ford, Monsanto CEO Hugh Grant, former Secretary of Energy Steven Chu, the CEO of Virgin Galactic, and many more.

The conference is by invitation only, but CEO Daily readers get special consideration. Register here, and I’ll look forward to seeing you in Carlsbad.

More news below.

Alan Murray


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