Intel is an innovative, cutting-edge semiconductor company, one of perhaps only a small handful of such companies. It has historically had significant market share for the worldwide semiconductor market, enjoying large margins.

Today, the business model is changing. Margins are shrinking under pressures from an increasingly competitive market, which requires new solutions to problems in new areas such as power consumption, form factor, and usage models. To successfully deliver in this market, Intel is changing its business model to deliver usage-centric platforms that require ingredients and ingredient groups to work with each other, and with external companies, to deliver complete integrated solutions–a new paradigm for Intel.

These challenges translate into a product development environment at Intel that is dynamic, intense, and stressful.

Risk management can help alleviate the negative qualities of this environment. Over the past two years, Intel's Corporate Program Management Office (CPMO), a group within the Corporate Platform Office (CPO), has dedicated a team to focus on development and deployment of standard Risk Management Processes and Tools across Intel that meet the needs of the product development environment. We, the members of the CPMO and CPO, have affected significant change in how Intel's product development teams approach risk.

Intel has a world-class risk management methodology. From this methodology we developed a process and a central risk database, High Speed Database-Risk (HSD-Risk), to provide a standard way to identify, assess, prioritize, and plan to prevent and deal with risks. This allows all members of the product development world to think of and talk about risk management in the same way. Before the risk management team began its work, there were many examples of different risk grading and impact systems, as well as different, non-compatible tools for capturing and communicating their risks, even within the same team. In the flexible multi-level team environment required by platforms, this simply wouldn't work.

While we achieved some successes in implementing risk management across Intel, we found that a common process and database tool wasn't enough to ensure success. Team behavior had to change: instead of performing risk management as a "check the box" activity, teams had to learn to manage risk on a day-in day-out basis. The key to changing team behaviors lay in clearly defining the difference between "passive risk management" and "active risk management."

Actively managing risks has provided several teams with tangible results ranging from pulling in product launches to quickly reacting to the Microsoft Windows Vista* operating system changes. They have gone from proactively investing more capacity in verification systems to keeping the backend development timeline of a product in line with launch. As more teams across Intel adopt this common process and tools, success will become commonplace and have more impact.

Quantitative techniques using Monte Carlo schedule analysis are being piloted within the product development environment with excellent success. As Intel's active risk management capabilities continue to mature, quantitative techniques will play a greater role in decision making.