Transcript Sematech 1/05/2001

SEMATECH & Semi-Gas
Objectives:
Explore Consortium criteria
Examine Business R&D management
practices
Lessons for effective public influence
Consortium Criteria
Cost sharing
- must motivate tradeoffs
all qualified players must be admitted
common objective
- research
- manufacturing
long term objective -- Return on
Investment
Consortium Criteria
Expectations
- do all members have to have the
same
expectations?
- it helps!
Working relationship between members
who are also market competitors
targeted market: existing or expanding?
Consortium Criteria
Legal implications
- patents & licenses
- anti-trust considerations
Consequences of Pooled R&D resources
- collective investment has greater
yield
than the sum of the parts
- or lowest common denominator
Business R&D
Management
Focus on:
- product innovation
- product improvement
- process innovation
- process improvement
Budgeting for R&D
- % of sales; expenses; or revenue
- apportioned to products or cost
Business R&D
Management
Application to product/process
National Semiconductor criteria
- product must be #1 or #2 in market
- gross margins of at least 40%
- product needs to generate at least 15
times the R&D cost
Business R&D
Management
Consequences of Consortium participation
industry contribution based on:
- number of members
- % of sales
- assignment of personnel (cost?)
Public Influence
Active participant:
- Absent government involvement, what is
the consequence?
- will government involvement change
market condition?
Public Influence
Active or passive participation:
clearly establish goals
define “success”
what new market demand is expected to
emerge or will longer term public financial
support be required
Public Influence
Government as active or passive participant:
how is the level of public support
determined
-- direct funding
-- tax advantages
-- regulated market
Public Influence
Active or passive participation:
Contractual cost sharing
membership exemptions/criteria
define the government role
consortium requires industry leader: how
will the leader be selected?
“Sun-set” clauses
Conclusion
Consortium criteria
Business R&D Management implications
Effective Public Influences
SEMATECH Epilogue
National Semiconductor and 2 other
members discontinued financial support
Consortium permitted them to stay
anyway
Goals changed in SEMATECH II to semiconductor manufacturing process
improvements
Public financial support ended in 1996