10/01/2001
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Many equipment and material suppliers in our industry talk about providing "total solutions" to their customers, rather than just a piece of equipment or batch of material. This might include customized features, process parameters, accompanying consumables, extensive in-house service, integration technologies and partnerships with suppliers of related products.
On the other hand, many other companies talk about focusing on their "core competencies" by outsourcing some of their work or trimming their product offerings to more closely match their expertise.
So, which is the right approach? The answer, of course, is that there is value in both business models. In fact, the industry is better off with both types of companies and everything in between. The theories say that societies or organizations that survive and thrive are those whose members have a range of characteristics and skills, allowing the organizations to adjust to changing situations. Start-ups consisting of 100 percent engineers never make it.
At one point in my circuitous career path, I worked for a seven-person manufacturer of wire bonding tools. We were pretty focused, making only a certain kind of bonding tool with an osmium alloy at the tip. It's hard to imagine a more narrow business in the industry. The company did well, though, with a set of customers that needed exactly what we made. We did not do well, however, with companies that needed other types of bonding tools. These companies didn't have the resources to deal with multiple suppliers, just like we didn't have the resources to deal with a wide range of products. Our company softball team had a few gaps too.
Some companies have gone too far in the other direction over the years, though, with more diversification than they can handle. One artifact in my collection illustrating this is a 1970s-era National Semiconductor brand digital watch. These are long gone, but perhaps National was just a catchy four-note jingle away from getting on the IC-manufacturer-as-consumer-product-provider boat.
Still, it is good to see companies today expanding their scope further and providing products beyond the basic equipment. The expansion of Kulicke & Soffa, for example, in various directions in the past few years with acquisitions that fill out more of the packaging supplier space has probably been good news to people who are happy to let their vendors worry about putting the pieces together.
The packaging world is still far behind the wafer fab world in this effort, though. Check out Honeywell's STAR center, with equipment from many suppliers working on integration solutions, or think about the process outcome guarantee from Applied Materials. How's that for a packaging industry target? AP
Thanks for reading,
Jeffrey C. Demmin
Editor-in-Chief
[email protected]