AMD CEO's Shoddy Record Taints Turnaround

Call it déjà vu, or a flashback, but Hector Ruiz has been here before.

Ten years before the Advanced Micro Devices(AMD Quote) CEO's current effort to keep his company afloat, Ruiz was caught in another strait. As the head of Motorola's(MOT Quote) chip group, then the world's third-largest semiconductor maker, Ruiz was the architect of a massive reorganization that upended Motorola's manufacturing model, transformed its product strategy and resulted in the loss of thousands of jobs.

The goal was to revitalize a moribund organization amid growing competition. In practice, it was a messy affair, marked by continual setbacks and revisions, in which success ultimately proved elusive and rendered Ruiz's legacy controversial.

"He never got it right," says Will Strauss, principal analyst of market research firm Forward Concepts, noting that Ruiz tried to reorganize Motorola's chip group almost as many times as the number of years he led it.

Whether Ruiz can get it right at AMD -- which has lost $4.3 billion in the past six quarters, and has seen its share price plummet more than 50% in the last 12 months -- is a key question for investors. Ruiz has promised to reinvent some of the most fundamental aspects of the Sunnyvale, Calif., microprocessor maker in the coming months and return the company to profitability.

But a look back at the last time Ruiz tried a reorganization of this scale raises plenty of reasons for uncertainty.

When Ruiz took over Motorola's chip group in 1997, he had a bold vision for overhauling the business -- and a free hand to carry it out.