Trump vs. Intel CEO vs. Intel Board

The Impossible Job

One way to get fired as the CEO of a major American corporation is to run the company into the ground. Another, more modern way is to have the President of the US demand your resignation on social media. This week, Intel CEO Lip-Bu Tan found himself in the latter predicament.

On its face, the issue is straightforward. The President, backed by allies in the Senate, believes Intel's CEO is "highly CONFLICTED" due to historical business ties to China. But the situation at Intel is, it turns out, more dramatic than that. The president's attack landed on a CEO who was already fighting a battle for his strategy, and perhaps his job, inside his own boardroom. The Wall Street Journal reported yesterday on the internal chaos:

Tan and some Intel directors have disagreed in his first months in the role about questions as central as whether the company should stay in the manufacturing business or exit it entirely, according to people familiar with the matter. Recent efforts by Tan to raise new capital and acquire an artificial-intelligence company have been stalled by people on the board, they said.

This puts the CEO on a spectacular, and likely untenable, collision course with both his board and the White House. From one side, the White House is demanding that Intel serve as the public face of an American manufacturing renaissance, a role backed by nearly $8 billion in CHIPS Act funding. The Trump administration needs a political win, a story of grand factories rising from the heartland. This isn't subtext; it's the entire point. When Nvidia recently announced its own US manufacturing push, the White House immediately framed it as a political victory, calling it "the Trump Effect in action" and proof that the President's "relentless pursuit of an American manufacturing... is paying off."

From the other side, Tan faces a board that has reportedly explored exiting the manufacturing business entirely, has stalled his efforts to raise new capital, and has blocked potential AI acquisitions. While the White House wants him to spend more, faster, his own board is tying his hands. Tan's recent moves—delaying the Ohio project and telling staff "there are no more blank checks"—run directly counter to the triumphant narrative the administration wants to project.

Lip-Bu Tan was hired to navigate a difficult corporate turnaround. He now finds himself trapped between a board that may not want to fund the journey and a government that demands he arrive at the destination ahead of schedule. The pressure isn't just coming from the Oval Office; it's coming from across the table.

Is McKinsey Automating Itself?

One way to think about a consulting firm like McKinsey & Co. is that its core product is, essentially, brains-as-a-service. Corporations pay billions for access to elite human intelligence, packaged and delivered in PowerPoint decks. So it is interesting when McKinsey's own leadership declares that its business is facing an "existential" threat from a machine that is getting very good at thinking.

This is not a distant, hypothetical problem. McKinsey is already rewiring its entire business in response to artificial intelligence that can increasingly perform the core tasks of its highly-paid consultants. The firm has deployed 12,000 AI agents—with a goal of having one bot for every human employee—to assist with the foundational work of consulting: building slide decks, summarizing research, and even writing in the classic, concise "McKinsey tone of voice." This technological shift is happening alongside a human one, as the firm's headcount has shrunk from 45,000 to 40,000. Here is the WSJ on the new reality:

The size of teams is changing. Traditionally, a strategy project with a client might require an engagement manager—essentially, a project leader—plus four consultants and a partner. Today, it might need an engagement manager plus two or three consultants, alongside a few AI agents and access to “deep research” capabilities, Smaje said. Partners with decades of experience might prove more indispensable to projects, in part, because they have seen problems before.

“You can get to a pretty good, average answer using the technology now. So the kind of basic layer of mediocre expertise goes away,” Smaje said. “But the distinctive expertise becomes even more valuable.”

This is a profound unbundling of the traditional consulting business model. For decades, the model has been to leverage armies of smart, young associates from top universities. Clients were billed based on the size of the team and the duration of the project, a system that effectively bundled the expensive wisdom of senior partners with the relatively cheaper labor of junior analysts doing the grunt work.

AI directly attacks this model by automating the grunt work. The rote tasks that justified staffing large teams—data collection, research, summarization, slide-making—are precisely what AI excels at. This collapses the pyramid structure of the knowledge workforce. The "basic layer of mediocre expertise," as McKinsey's AI lead put it, is being commoditized by machines.

The most immediate impact is on the junior consultants, whose roles are being automated. Conversely, the senior experts with decades of experience and true "distinctive expertise" become even more valuable. When a machine can produce the analysis in minutes, the value is no longer in the analysis itself, but in the wisdom to apply it correctly.

McKinsey is simply the canary in the coal mine for a much larger transformation. The same forces are set to reshape law, finance, accounting, and any other industry built on selling expertise. The era of the "suit with PowerPoint," as one rival CEO put it, is coming to an end. The core product that these firms have sold for a century—packaged human intelligence—is being commoditized. The race is now on to prove that their human wisdom is still worth the price.

The Scoreboard

• Consumer: Apple and Trump detail $100 billion U.S. spending expansion, including $2.5 billion for an iPhone glass factory (CNBC)
• Software: Duolingo Lifts Sales Outlook as It Widens Non-Language Offerings (Bloomberg)
• Marketplace: Airbnb beats on top and bottom lines for second quarter (CNBC)