Intel’s Paul Otellini has followed the pattern of many incoming chief executives by deciding to reduce overall staff numbers. The reason is the usual one of a few disappointing quarters of financial results. But Otellini is looking in the wrong place for big improvements, because Intel’s troubles will not be solved by firing a few staff.

Among the targets for the axe are senior marketing staff, involved in market development and advertising, because Intel has more managers in these positions than its arch-rival, AMD. However, this is likely to be a bad strategy, as the redundant staff could join the opposition. That would give AMD even more clout in the marketplace, where it has already stolen a probably temporary lead in multicore processors. If Intel isn’t careful it may slip gently into the role of permanent also-ran.

Meanwhile, rumours also suggest that Otellini plans to rebalance the workforce by recruiting more customer-facing sales staff, suggesting that he is aware it is an increasingly uphill struggle to sell Intel processors. But adding more sales staff to a firm where, for many years, the processors almost sold themselves will, in a tough market, just equal less profit.

Intel’s troubles cannot be solved by cutting overall staff numbers and adding a few to particular departments. The real problem is that Intel is suffering the traditional hardships of any company that has pushed a technology too far and too hard. The x86 architecture has passed its sell-by date.

For some this idea may seem heretical – particularly the armies of IT managers who have built empires on the back of x86-based servers. Well, they needn’t worry: x86 servers are not going to disappear overnight. But some experts are now seriously suggesting it’s time for chip makers to move on to a new generation of technology using parallel processing.

Steve Prentice, vice-president and distinguished analyst at Gartner Group, recently noted the trend to increase processor and system performance with parallelism and more built-in redundancy on the chip.

Of course, we already have dual-core x86 chips, and IBM sells four-core Power processors, and in a few years we will probably be able to buy Xeon and Opteron chips with eight or 16 cores.

But Iann Barron, once leading light of famed UK-government backed startup Inmos, suggests that if we can get more parallelism into computer software then faster systems will be possible. Given that some software would benefit from a rewrite to optimise it for 16-way hardware, there’s an opportunity to rethink software architectures and possibly move to alternative processors.

So Otellini firing a few staff won’t save Intel’s bacon. To counter what is coming and not just be left with a dwindling market, Intel needs to make drastic changes in product direction. And that will need very motivated staff. Hatchet jobs rarely achieve that.