Solid State Technology Magazine (www.electroiq.com) reported that IBM Corp. is exploring the sale of its semiconductor business, with Goldman Sachs assisting. The news isn’t really a surprise, just a disappointment that many important US top executives seem to lack the understanding of how to make manufacturing a successful business unit.
Owned semiconductor manufacturing has concrete benefits. Manufacturers can cut the design-to-delivery timeframe and get to market quickly. Companies can differentiate their products in terms of features, performance, and, therefore, value to customers. Market appeal means stronger brand appeal. Brand appeal correlates to sales and revenues.
However, manufacturing is a hardware business. It means understanding machinery, processing, and operations. It also means understanding chip design, product cycles, and being able to tie a lot of activities together from sales, to design, to fabrication, to delivery. It just doesn’t seem that some executives can string all those activities together.
The IBM CEO has a sales, marketing and service-consulting background. This is similar to what we saw in the former and current Hewlett-Packard CEOs. While these resumes are stellar, they are not compatible with the requirements for manufacturing businesses. That makes the IBM move not surprising, just confirmation that manufacturing requires manufacturing expertise.
The above is the personal opinion of Barbara Kalkis, Maestro Marketing & PR