Success amid the chaos

Basel, Switzerland--The essence of successful technology businesses is the ability to capitalize on opportunities at a time of relentless change.

That's how Hans-Martin Schneeberger, CEO of W. Schneeberger AG, views today's economic climate. To help mark his linear technology company's 75^th anniversary, Schneeberger sponsored a special symposium where major global manufacturers described their development strategies.

Christian-Erik Thouny, vice president of ESEC SA, a producer of wire and die-bonding machines, talked about the importance of separating engineering teams involved with developing innovative technology from those working on refinements of standard machines. With development cycles constantly shrinking, he noted that those working on standard lines need to make quick application changes to meet immediate customer needs. Meanwhile, "skunkworks" engineers must be free to pursue innovative projects without interruptions. Companies must also insure that both groups benefit from early warning of technology trends that could affect their work.

Stefano Concina, vice president of KLA-Tencor, a California-based maker of wafer-inspection equipment, described his company's approach to developing the KLA 8100. This machine can measure critical dimensions on a wafer at a resolution of 5 nm (1 nm is equivalent to 0.001 microns). It also set records for speed--measuring 40 wafers an hour. If a wafer is rejected, the offending piece of manufacturing equipment has to be adjusted.

When it started the project, KLA first considered an internal development program. But the fastest route to market turned out to be buying a start-up company, Metrologix. The added technical expertise allowed KLA to ship two beta KLA 8100 machines just a year after the acquisition. By July of 1997, KLA had captured 30% of new orders for CD-SEMs (critical-dimension scanning electron microscopes).

Says Concina: "To grow, we must execute our survival plan flawlessly." That plan includes forming more partnerships with suppliers to improve design, reduce costs, and speed development. Schneeberger, for example, provides KLA with positioning stages for its machines. "We feel that we are part of KLA's design team," says Hans-Martin Schneeberger, "but that means we must provide powerful application support on site."

While the semiconductor industry is legendary for fast development, Schneeberger notes that the machine tool business also feels tremendous time pressures. "A company like GROB Machine Works sometimes must outfit an entire factory."

At the Schneeberger symposium, GROB Vice President Gero Martel said that automotive customers are demanding more flexible manufacturing equipment and cost reduction. GROB, which produces machining centers and components for transfer machines, is in turn asking suppliers not only for improved components for high-speed machining but suggestions for lowering costs on GROB products. The German company also wants suppliers who can deliver systems and environmentally-friendly products, such as components with built-in lifetime lubrication.

While helping companies cope with constant change presents great opportunities for global suppliers, there are also some big obligations. Says Schneeberger: "You must commit to supporting them locally all around the world."