1. © Bay Area Consulting Group LLC IT Performance: ottenere risultati con i dati e non con l'intuizione Harry Chapman Principal Bay Area Consulting Group LLC Hchapman@baconsulting.net (415) 971-5746 IT Measurement at Intel 11

2. Page 1 © Bay Area Consulting Group LLC About Intel Revenues $54B Employees82,500 IT Employees6,400 Operations – 164 IT sites in 62 Countries Ranks 51 in the Fortune 500 - [60 in 2008] One of the 30 Stocks in the Dow Jones Industrial Average - Ranks 28 th

3. Page 2 © Bay Area Consulting Group LLC Intel’s CEO – Andy Grove 1988Endangered Earth 1989 Mikhail Sergeyevich Gorbachev 1990The Two George Bushes 1991Ted Turner 1992Bill Clinton 1993The Peacemakers 1994Pope John Paul II 1995Newt Gingrich 1996Dr. David Ho 1997Andy Grove 1998Bill Clinton and Kenneth Starr 1999Jeff Bezos 2000George W. Bush 2001Rudolph Giuliani 2002The Whistleblowers 2003The American Soldier 2004George W. Bush 2005Bill Gates, Melinda Gates, & Bono 2006You 2007Vladimir Putin 2008Barack Obama 2008Barack Obama

4. Page 3 © Bay Area Consulting Group LLC Intel’s 2011-12 IT Performance Report

5. Page 4 © Bay Area Consulting Group LLC 2011-12 Vision and Objectives

6. Page 5 © Bay Area Consulting Group LLC About Intel

7. Page 6 © Bay Area Consulting Group LLC From the 2011-12 IT Performance Report

8. Page 7 © Bay Area Consulting Group LLC From the 2011-12 IT Performance Report

9. Page 8 © Bay Area Consulting Group LLC From the 2011-12 IT Performance Report

10. Page 9 © Bay Area Consulting Group LLC Strategic Objectives Over the Years Obj.2006200720082009 1 Increase Intel’s profitability Deliver a standardized, cost-effective computing environment that keeps Intel running Build an engaged and energized IT Team 2 Set the standard for operational excellence inside Intel and throughout the IT industry Be an agile, high- performing organization Deliver competitive IT operational services that power Intel’s business Deliver enterprise solutions to our customers that drives Intel’s growth 3 Make Intel IT a great place to work Influence and deliver solutions that create bottom-line improvements for Intel Deliver information and technology solutions that create top- and bottom-line improvements for Intel Deliver competitive IT operational services that power Intel’s business 4 Impact Intel’s product development and share our best practices with the industry

11. Page 10 © Bay Area Consulting Group LLC Strategic Objectives Over the Years Obj.2010-112011-12 1 Business Solutions: Delivering Business Value Business Efficiency: Boosting the Velocity of Intel’s Business 2 IT Efficiency: Driving Maximum Value on a Fixed Budget Business Growth: Expanding Intel’s Business through IT 3 Leadership and Management: Developing IT Best Practices Employee Productivity: Empowering Employees with IT Consumerization 4 Employee Productivity: Embracing Consumerism and Global Collaboration Enterprise Security: Protecting to Enable the Business 5 Data Centers: Our Cloud Computing Journey Data Centers: Delivering Agility through Our Private Cloud 6 IT Security: Securing the Enterprise IT Efficiency: Achieving Operational Excellence 7 Leadership and Management: Moving IT Out in Front

12. Page 11 © Bay Area Consulting Group LLC The Mission/Vision over the Years YearMission/VisionVision 2004No Mission/Vision but very detailed performance measures 2005“Deliver the critical information solutions needed to keep Intel running and growing” 2006“Deliver IT capabilities that keep Intel running and enable growth” 2007“Deliver IT capabilities that keep Intel running and enable growth” 2008“Deliver competitive I + T” “Our people and solutions enable Intel’s growth and business transformation” 2009“IT is a competitive differentiator for Intel” 2010- 2011 “Use IT to deliver business value to Intel” 2011- 2012

13. Page 12 © Bay Area Consulting Group LLC But the Strategic Objectives changed Objective20062007 1 Increase Intel’s profitability Deliver a standardized, cost- effective computing environment that keeps Intel running 2 Set the standard for operational excellence inside Intel and throughout the IT industry Be an agile, high-performing organization 3 Make Intel IT a great place to work Influence and deliver solutions that create bottom- line improvements for Intel

14. Page 13 © Bay Area Consulting Group LLC 2006 IT Strategic Objectives 1.Increase Intel’s Profitability Intel capabilities are a core competitive strength; we contribute to Intel’s profitability Provide business value that directly impacts Intel’s bottom line Enable Intel’s Supply Chain Design and develop new products Demonstrate IT industry leadership

15. Page 14 © Bay Area Consulting Group LLC 2006 IT Strategic Objectives 2. Set the Standard for Operational Excellence Inside Intel and Throughout the IT Industry IT is critical to all of Intel’s business units and we set high standards for how we operate Increase IT’s cost competitiveness Evolve and maintain the “right” service level Consolidate our infrastructure Simplify the architecture environment Manage risks to our data, applications and information

16. Page 15 © Bay Area Consulting Group LLC 2006 IT Strategic Objectives 3. Make Intel IT a Great Place to Work We support our IT employees – our most valuable asset – by making sure they are challenged in their jobs and can grow professionally Provide training and education Reorganize and streamline our IT organization so that our employees are empowered to make strategic decisions more quickly Give employees the tools and technologies they need to get their jobs done Provide opportunities to give back to the community

17. Page 16 © Bay Area Consulting Group LLC Overall Results for 2006 $1.3 Billion Total Business Value Delivered by Intel IT $748 M Business Value from Supply Chain Improvements $32M Business Value from New IT Innovation Provide business value that directly impacts Intel’s bottom line Enable Intel’s Supply Chain Design and develop new products Demonstrate IT industry leadership 1.Increase Intel’s Profitability Intel capabilities are a core competitive strength; we contribute to Intel’s profitability Strategic Objectives Results

18. Page 17 © Bay Area Consulting Group LLC Overall Results for 2006 2. Set the Standard for Operational Excellence Inside Intel and Throughout the IT Industry IT is critical to all of Intel’s business units and we set high standards for how we operate 1.4% IT Headcount Reduction 87.5% Critical Service Level Agreements Exceeding Goal 89% Intel Employee Satisfaction with IT Technical Support Strategic Objectives Results Increase IT’s cost competitiveness Evolve and maintain the “right” service level Consolidate our infrastructure Simplify the architecture environment Manage risks to our data, applications and information

19. Page 18 © Bay Area Consulting Group LLC Overall Results for 2006 3. Make Intel IT a Great Place to Work We support our IT employees – our most valuable asset – by making sure they are challenged in their jobs and can grow professionally 72% Training and Career Development Participation 90% IT Employee Satisfaction with Training Programs 89% IT Employees Satisfaction with Manager’s Communication (goal 85%) Strategic Objectives Results Provide training and education Reorganize and streamline our IT organization so that our employees are empowered to make strategic decisions more quickly Give employees the tools and technologies they need to get their jobs done Provide opportunities to give back to the community

20. Page 19 © Bay Area Consulting Group LLC 2007 IT Strategic Objectives 1.Deliver a standardized, cost-effective computing environment that keeps Intel running Improve Data Center efficiency Provide the “Right” level of IT service Transform Intel’s ERP environment Standardize application development Increase cost competitiveness Manage IT spending Keep Intel IT legal

21. Page 20 © Bay Area Consulting Group LLC 2007 IT Strategic Objectives 2. Be an agile, high-performing organization Increase use of the Capability Maturity Model Integration (CMMI) Implement IT resource management Improve Program Lifecycle (PLC) usage Improve usage of Continuous Improvement Improve Engineering of business processes Build our business partnerships Improve decision-making

22. Page 21 © Bay Area Consulting Group LLC 2007 IT Strategic Objectives 3. Influence and deliver solutions that create bottom-line improvements for Intel Manage Intel’s Supply Chain Improve our customer orientation Lead the IT industry

23. Page 22 © Bay Area Consulting Group LLC Overall Results for 2007 Expect to achieve a NPV of ~$550 – 650 million and overall cost avoidance of $1B Transformed independent service desks into one integrated support organization resulting in ~$10M in savings Completed seven application moves Reduced 33% of applications in two years Achieved a $64m in cost savings Reduced overall IT spending to 3.25% of revenue Reduced tom to contain cyber events to 2.43 days from 5 days Improve Data Center efficiency Provide the “Right” level of IT service Transform Intel’s ERP environment Standardize application environment Increase cost competitiveness Manage IT spending Keep Intel IT legal 1.Deliver a standardized, cost-effective computing environment that keeps Intel running Strategic Objectives Results

24. Page 23 © Bay Area Consulting Group LLC Overall Results for 2007 2. Be an agile, high-performing organization 98% of IT projects us CMMI Introduced Resource Management Capability Updated Training on PLC Increased Training and skills development Saved $65M via process improvement Added metrics to IT Scorecard Implemented 240 decision- making forums across IT Strategic Objectives Results Increase use of the Capability Maturity Model Integration (CMMI) Implement IT resource management Improve Program Lifecycle (PLC) usage Improve usage of Continuous Improvement Improve Engineering of business processes Build our business partnerships Improve decision-making

25. Page 24 © Bay Area Consulting Group LLC Overall Results for 2007 3. Influence and deliver solutions that create bottom- line improvements for Intel Eliminated 90% of customizations in legacy warehouse system Implemented “My Sales and Marketing” portal Shared IT experience with IT professionals via Intel’ Premier Professional program Strategic Objectives Results Manage Intel’s Supply Chain Improve our customer orientation Lead the IT industry

26. Page 25 © Bay Area Consulting Group LLC Plans for 2008 New Mission “Deliver competitive I + T” Intention is to demonstrate the importance of BOTH information and technology. Historically, technology has been primary and information secondary.

27. Page 26 © Bay Area Consulting Group LLC Let’s Hear from the CIO.. Intel’s CIO is John “JJ” Johnson

28. Page 27 © Bay Area Consulting Group LLC Note What He Says… “Modified” Balanced Scorecard Approach  Financial  Customer  Internal  Organizational and People Agile – High performance Standardize, Cost-Effective Infrastructure Top and Bottom-line growth In line with Business Plans (aligned) External Checks – bench marking Focused – show improvement – aligned to business partners

29. Page 28 © Bay Area Consulting Group LLC One Key to Intel’s Performance… Intel’s Business Value Index Started in 2001: IT organization challenged to measure the bottom line impact – the business value – ot their IT solutions The result became Intel’s Business Value Index

30. Page 29 © Bay Area Consulting Group LLC Elements of the Business Value Index (BVI)  A standard set of financial business measurements of business value – known as “Business Value Dials”  A standard methodology to determine the impact of It solutions  A common valuation process with finance acting as the independent auditors  A business-value portfolio of forecasted and delivered results determined by customer-generated critical success factors  A set of ground rules to define the program’s operations and drive accountability

31. Page 30 © Bay Area Consulting Group LLC Some Important Elements  Common language  “Dials” were defined  Finance was intermediary  Value defined by customer, not IT

32. Page 31 © Bay Area Consulting Group LLC Intel’s Business Value Index Overview Creates business unit/ user resistance Improved IT efficiency with no business value priority Improved business value and IT efficiency FailureNecessary, but low value Improved business value with limited or no IT efficiency penalty Failure Requires incremental IT budget IT Efficiency Business Value - - + + 0 0

33. Page 32 © Bay Area Consulting Group LLC How BVI Works BVI works by evaluating IT investments along three factors: 1.IT business value (impact on Intel’s business) 2.Impact to IT efficiency 3.Financial attractiveness of an investment. The factors included are:  Customer need  Business and Technical Risks  Strategic Fit  Revenue Potential  Level of investment required  The innovation and learning that an investment generates

34. Page 33 © Bay Area Consulting Group LLC Summary This is a glimpse into how a very large IT organization uses measures to improve performance. For more, go to http://www.intel.com/ithttp://www.intel.com/it To find Intel’s IT Annual Performance Reports, Google “Intel IT Performance Reports”