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Jun22
Andy Grove: Only the Paranoid Survive - 14

"When there is an opportunity that you can pursue, if you choose not to pursue it you are choosing a different corporate persona."


Grove was referring to choosing a path of the highest growth when he mentioned the statement above. He felt that if an opportunity arose that offered a higher return, you should take it or you wouldn't be the same company anymore.

There's something in that I disagree with. Of course Intel (INTC) had some core values and beliefs that they had to adhere to, and if this was one of them, so be it.

But Grove sometimes struggled when these things happened as he would change values and purpose of the company for the sake of growth. That's an extraordinarily risky thing to do that very few people could pull off; even the best of them.

So with Grove, growth was the major value he considered the core of the company, so he had to live that conviction and work from those assumptions. For him it worked pretty good, although Intel has had some very cyclical times ... something that mentality can bring a company through.

Andy%20Grove%20Growth%20was%20Foundational.jpg

When talking about growth and the microprocessor for Intel, Grove said that the time could come when its growth rate could slow down and they could be a 10-percent growth company per year. He felt that for Intel they could adjust their spending to that and focus on being a real good 10-percent-a-year growth company, but then they would no longer be the same company.

I think this type of view is a little off. I looked at a 10-year chart for the company, and their share price in 1997 was around $20, and today it hovered around 24. So over that period of time it hasn't had anything to boast about at all as far as growth goes.

Was Grove wrong in his outlook? I don't know. I couldn't make the largest growth opportunity the core value of a company. I think what a company represents can't be the best opportunity for growth, it doesn't represent a value of any type. Growth is of course important, but something more than that must be a foundation of a company. Those that believe in a company will end up getting growth because of that belief, not because growth is the belief.

This time I have to disagree with a great business leader. I don't think that it necessarily means you're no longer who you are because you don't choose what looks like the fastest way to grow, when it doesn't fit into what a company is supposed to represent. What do you think of Intel, when their name comes to mind?

Other Andy Grove Resources:

Andy Grove's Rational Exuberance

What I've Learned: Andy Grove

The Digital Age . . . driven by the passion of Intel's Andrew Grove

The History and Influence of Andy Grove

The Education of Andy Grove

Churning Things Up

Grove Quotes

Andy Grove's Re-entrance

Q&A: Andy Grove

Andy Grove enters new post-Intel role as activist capitalist

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