Q and A Archives

Peruse a rich archive of questions and answers that ran from 1999 to 2017
2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999


December Having recently introduced the 300mm wafer, when is the next change in wafer diameter and what size might it be?
A: The 01 ITRS projected that a 450mm wafer would be in first production by 2016 and may be initial production by 2013.
November In the mid-2000’s what percentage of the IC revenue do the top 25 device manufacturing (non-foundry) companies capture?
A: Between 80 — 90%. The top 10 account for 55 — 60%. So after the 25th IC company, the size of the company drops off rather fast.
October In a conference room meeting with customers in Western cultures, where should the person considered the expert on your team sit?
A: At either end of a rectangular conference table. Regardless of that person’s rank on your team, questions from the customer will usually be addressed to the person sitting in those locations.
September One way of identifying companies and their interaction with their markets is to separate them into "Product-Driven Enterprises," or "Order-Driven Enterprises," or "Market-Driven Enterprises" groups. What is the difference between these groups?

Product-Driven Enterprise — This is a company preoccupied with technology. New product development is mainly influenced by internal engineering rather than market requirements. As a result, new products do not enhance total customer value and have difficulty succeeding in a competitive marketplace.

Order-Driven Enterprise — Here the company’s new product development is overly influenced by orders, or potential orders. Features that are customer specific are developed to capture a specific customer order, and then often misinterpreted as a total market need. These special features or material characteristics often do not add total market value, but increase complexity, cost, change control requirements, reliability, and lower manufacturability without capturing more than the one customer.

Market-Driven Enterprise — This company listens to its customers and potential customers. This is done through organized, methodical, market research that captures the needs of the marketplace in something like a Market Requirement Statement (MRS). Through constant update of this document it produces products that enhance total customer value and are highly competitive.


August What do I do when a customer’s purchasing department sends me a purchase order with a set of fine print terms and conditions that are unfavorable to us and they insist I have to acknowledge them by sending back a signed acceptance copy?
A: Your customer will always do this. Laws vary all over the globe and we can’t address each country. However, if the contract is made in the United States, you should not sign the acceptance copy. Instead send them back a letter thanking them for the order and saying you are glad to accept based upon the terms and conditions in your proposal. This may cause a round or two of similar communications between you. With two different T&Cs the Universal Commercial Code will ultimately determine the dispute and the table will be even for both of you.
July There is one mandatory requirement that a product must meet, and an account team must emphasize, for a profitable sale to result. What is it?
A: "Differentiation" of benefits (when compared to competitive products) that a specific customer finds of significant value. Sales can and are made without the customer perceiving such differentiation, but the product is then treated as a commodity and low, low price is the only bargaining chip available.
June What is the compound annual growth rate (GAGR) for semiconductor equipment over the ten-year period from 1998 to 2008?
A: The CAGR for semiconductor equipment in the 10-year period of 1998 — 2008 is anticipated to be 8%. While this is significantly lower than historical experience, it is still one of the fastest growing industries in the world.
May Japan plus the PacRim (Korea, Taiwan, Singapore and China) are forecast to dominate device production after 2010. What percent of the world’s IC production will China likely have at the time?
A: In 2005 China is producing 2.7% of the world’s IC production. That figure is expected to rise to 5% by 2010.
April The People’s Republic of China is a rapidly emerging market for semiconductor equipment, materials, components and software. At its current stage most suppliers are finding the push for low prices to overwhelming be the buyer’s major consideration. What is the single most important strategy a supplier should pursue to counter this?

The supplier is and will continue to try and turn your product or services into a commodity. If it is considered a commodity, the only thing you have to negotiate with is lower price. So, your most important strategy is to POSITION your products through DIFFERENTIATION that has significant competitive value to the buyer. This is an over-simplification, but you can find a lot of expansion of the idea in numerous articles on this site. Some topics to look for are: Differentiation, Positioning, Pricing, Branding, and Value Propositions.


March The sale of devices for use in electronic products ultimately drives the need for equipment and materials in the semiconductor industry. How much will those sales go up or down between 2004 and 2006 and which world regions will purchase the most?

According to WSTS, Inc. (World Semiconductor Trade Statistics), semiconductor revenue is forecast to increase 4.2% between 2004 and 2006 with the 2006 volume being US$221.8-billion. The growth and purchases by region are as follows:

2006 purchases CAGR 2004-6
US US$38.4B -2.4%
Japan US$39.4B +2.4%
Europe US$48.4B +4.6%
Asia US$95.6B +7.8%

February What are the biggest reasons for bad product introductions?

Timing—too early or too late.

Incomplete/Unrealistic Market Research—If the product does not meet the market needs at introduction it is doomed to failure.

Competitive considerations—if you don’t anticipate and plan for competitive reactions, or anticipate them wrong, you may have a big problem on your hands.

Poor execution—there are a significant number of things that need to be accomplished before, during, and after a product roll-out. If any of them are not done properly, you may have a failure. The solution to avoiding this is planning and the exhibition of leadership by product marketing.


January When we are trying to get commitments from customers, they indirectly tell us when they are ready to commit by their use of "verbs" and "pronouns" in sentences. What are the commitment verbs and pronouns that transmit that message?
A: When the verb is related to “specific action now” and the pronoun is in the “first person,” they are ready to make a commitment. For example, if the customer said, “How long does it take you to get me a sample?” there is interest but it is low (note that does is very tentative and you is not first person). If the question was, “How long would it take you to get me a sample?” there is stronger interest, but it is not yet at a commitment level. If the question was, “When can I have a sample?” they are ready to commit (note that can is specifc now, and I is in the first person).