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Semiconductors, China and Us

A friend observed that Elon Musk is remaking Central Texas with companies that bore (rock), move (electric trucks), launch (space ships), and link (your brain). And yes, it seems that the South African native opted for this most business-friendly of states over progressive California.

He’s not alone.

South Korea’s Samsung is negotiating a $17 billion expansion of its existing fabrication plant, or fab, Samsung Austin Semiconductor. The new fab will make logic chips, a more profitable product than the memory chips its made here for the past 25 years, and expand the company’s foundry business. Perhaps most important, it will do all of this closer to its U.S. customers.

With a national unemployment rate flirting with 8%, semiconductor manufacturing jobs pay about twice those in the rest of the manufacturing sector, feeding those middle rungs of the pay scale ladder where the middle class lives (or would like to live). Samsung’s new fab, for example, is expected create 1,900 jobs that pay an initial average annual wage of $66,254.

Semiconductors: Technology’s anchor store

Semiconductors, or microchips, are the technology food chain’s anchor store, the building blocks for advanced technologies that will run our factories, manage our cities, develop and deliver our medicine, re-shape education and the workplace, and keep us safe.

Semiconductors are the tiny chips that serve as the brains behind your toaster, your smartphone, all the way to fighter jets and in the very near future, they will serve as the brains behind the innovations of tomorrow such as 5G, quantum computing and artificial intelligence.
U.S. Representative Michael McCaul, ranking member, Foreign Affairs Commitee and Chair, China Task Force

Today about 90% of high-volume, leading-edge integrated circuit production in this made-in-America industry takes place in East Asia –Taiwan, South Korea and the People’s Republic of China. Although the United States remains the market leader in worldwide sales, the pandemic and a testy relationship with China have shaken both U.S. dominance and its confidence in the complicated, globalized supply chain and foreign markets those sales rely on.

There’s always a bit of machismo in dominating an industry, but also a real recognition that the ready availability of semiconductors is essential to both to national security and the future of America’s role in technology. Like sensible parents, microchip companies and policy makers want to bring some of that production closer to home. Of course there is a price to pay. According to the Boston Consulting Group, it will take $50 billion provided over 20 years to raise the United States from its #4 slot to #2 in domestic manufacturing production. Twenty billion will keep us at #4. By way of comparison, China is investing $170 billion in semiconductor independence.

About that global supply chain

The federal government has nurtured the semiconductor industry since its inception. The last time a foreign threat to U.S. dominance appeared, it bankrolled an industry consortium called SEMATECH right here in Austin. To underscore the importance of its mission, members installed no one less than the co-inventor of the microchip as chief executive.

There are those that ague against adopting anything akin to an industrial policy, but consider how integral semiconductors are to the drones, weapon systems and monitoring devices central to our national defense. Then consider the panicked workarounds that would be needed should supplies be disrupted. As if those risk scenarios aren’t enough, the biggest hack in U.S. history, also made here in Austin, was discovered in late December after months of burrowing undetected into the workings of both the public or private sectors. The 2020 Solar Winds Breach was a supply chain hack, perhaps through software maintained in Eastern Europe.

A time for enlightened partnerships

The semiconductor industry has shown a remarkable ability to develop ways to collaborate on common problems. SEMATECH skirted proprietary intellectual property issues and settled on a strategy of solving common manufacturing problems that would result in more efficient, effective manufacturing processes.

Not that supply chain concerns are restricted to the United States. Europe doesn’t want to depend on the United States or Asia. China doesn’t want to depend on the United States, and South Korea doesn’t want to depend on Japan, which doesn’t want to depend on South Korea. So depending on how you look at it, the field is ripe for geopolitical gamesmanship – and enlightened alliances.

As Samsung negotiates its plans in Austin, Taiwan-based TSMC is breaking ground on a $12 billion fab in Phoenix. Both Taiwan and South Korea are U.S. allies; both live in dangerous neighborhoods; both are manufacturing powerhouses, hosting respectively 36 and 24 operating fabs. In addition to its Austin fab, Samsung has six fabs in China and is reportedly repatriating its semiconductor supply chain. It closed its China-based smartphone factories in 2019 over intellectual property concerns.

Semiconductors are the tip of the iceberg.

The federal government is doing its part in maintaining a robust tech sector, its battles with Big Tech aside, passing the 2021 National Defense Authorization Act, thanks to the efforts of Congressman McCaul (R-Tx) and Doris Matsui (D-Ca) in the House, working with Senators John Cornyn (R-Tx) and Mark Warner (D-Va). The NDAA, which still needs to funded by Congress, provides incentives, grants and credits research and development and domestic fab construction.

But semiconductors are only the first rung of a technology food chain that creates industries that in turn create jobs, opportunities and living wages for real people and their kids. With geopolitical gamesmanship the name of the game these days, it’s a good time to look ahead, learn from not only the past and “our most serious competitor.”

Allies and immigrants: We get the job done

Which brings us back to Elon Musk.

Musk’s relationship with China transformed Tesla into a stock market darling and Musk into the world’s richest man. Tesla is a case study in using the anchor store concept to build supply chains. The all-important batteries that power Tesla EVs are made locally by Chinese manufacturers not the Tesla battery factory in Reno, Nevada. The romance may not last, but there’s a lot to learn from it.

Does Elon Musk answer to anyone? Turns out, the answer is yes. Take a look at the language Tesla used in response to the Chinese regulators inquiring about quality issues. In a filing, the company “sincerely accepted the guidance of government departments,” and “deeply reflected on shortcomings.” That’s a far cry from Musk’s belittling the SEC as the “Shortseller Enrichment Commission,” or telling U.S. auto regulators its rules are “anachronistic,” or attacking California health care officials as “unelected and ignorant.” Pretty clear where the power lies these days.
Alan Murray, CEO Daily, Fortune

Tesla’s Gigafactory in Shanghai, built in record time with $1.4 billion low-cost Chinese loan and a $1.6 billion infusion when Covid-19 hit. The factory uses locally-made batteries rather than those from its U.S. plant, building and strengthening the Chinese supply chain for EVs. (photo/dw.com)

Trying a New Approach to Collaboration, Large and Small

When I think of horrific meeting experiences, my mind rewinds to a hands-on seminar I led years ago for Apple. The objective was to introduce teachers to Apple’s desktop. It was a group presentation with auditorium-style seating and keyboards for participants to use in conjunction with the talk. About 10 minutes into my sch-peel, a tiny grandmotherly-looking woman stood up and said to the group: “We’re not idiots. Why do we have to listen to this person, let’s just do this!” And away they went, clicking happily along in utter chaos. That was point my boss walked in. Needless to say it was an interesting debrief.

I thought about that woman this week during a Liberating Structures workshop led by Keith McCandless (who wrote the book) and Anna Jackson who spearheads an LS meetup group here in Austin. Is there a better way to inform, collaborate, teach and motivate a group of people? I’m a newbie but I’d say the tools they introduced me to are the best I’ve seen so far. I can see how they could work in all kinds of organizations. The idea is to tweak the feng shui of group interactions – topic, space, pacing, participation – and deploy a set of tools that better focus and distribute the conversation among the people who matter.

liberated meeting — Are there more possibilities here? Bigger group, more leaders. See the 1-2-4-All tool.

You can read more on the Liberating Structures website. It lists all the tools and gives you a menu of when/how to apply them.

Since I haven’t applied it yet, the results are theoretical. But hey, if it works for The World Bank and The Gates Foundation, I’m all in. I’m intrigued about seeing how the tools would work cross-culturally, in situations where some of the participants are remote (there’s a technology conversation) and when selling one’s ideas to executives.

More to come. I only wish I, like Merlin, could live backwards: Just think how I could have helped and gained from that woman who was so frustrated and anxious to learn so long ago. I hope she’s running a company somewhere.

Who Put Brussel Sprouts in Every Shopping Basket?

What I want to know is this: Who engineered the comeback of brussel sprouts? Did I miss the tweets? Because the humble vegetable of my childhood, grey and waterlogged, has morphed into a supply side challenge.

Was it Mark Bittman and those classy NYT spreads? Some trendy chef in upper New York state, or even here in what was once a comfortably populist ATX (Tex Mex or a steak, anyone?)?

There’s been no humiliating name change (bruss?), as prunes have had to endure (dried plums?). They look the same: little cabbages, hard and round. No labor-saving innovations; still a somewhat tedious process that requires a colander, trimming, cutting, and unless you’re a roaster, a two-step cooking process.

They still, sauces and marinades aside, taste (and smell) like cabbages.

Was there a blog? A reality show (an island, 20-somethings, a case of brussel sprouts and lots of conflict?) Opeds?

Did Dr. Oz endorse them for their digestive qualities? Was it the source-agnostic but ever-purist French?

Where is the marketing team? I want to meet them.

Delete that photo!

A friend whose opinion I respect forwarded me a photo taken when I did not — shall we say — look my best. It got me thinking: Does this require action? Should I tighten up my reputation management? Get a makeover? What do geezer rockers do about this sort of thing? Does Robert Plant worry about his hair? Closed eyes?

Can it get any worse? Add wrinkles! — Can it get any worse? Always!

We are well on our way in an era of visual communication. Some people are blessed with telegenic looks and would shine climbing out of a dumpster. Does the way Nigella Lawson looks sell cookbooks? Of course. For the rest of us, it’s luck of the draw (or click). Forget command and control. I once worked with a top-ranking executive who, confronted with an unflattering photo, dispatched his minions to buy up every available copy of the trade mag in which it appeared, a feat that can never be repeated. As for prep, the jury’s out. I recently caught myself reaching over to sort out a no-nonsense entrepreneur’s hair (female). She’d probably been up since 4 that morning. Working. Personally, I think candid photography before 9 a.m. is cruel and unusual punishment.

What does our appearance say about us? My mother, raised a Texas girl, never poured her coffee or opened a newspaper until her lipstick and hair were in place. I can’t remember a time when she didn’t look beautiful. Then again, I remember Hillary Clinton’s eulogy at Gov. Ann Richards’ funeral less for what she said (although it was memorable: she touched on just this subject) than that she looked exhausted — like she’d worked all night and still cared enough to show up and honor someone who’d been important to her.

As for me, I’m leaning in the direction of a well-developed sense of humor. That may be the point.

Sitting is the new smoking

A friend gave me the news: Researchers have discovered there is no way to compensate for sitting. Forget the morning run, yoga, walking the dog, weights. Sitting is the new smoking.

My back and shoulder had warned me. I felt long fingers of gravity pulling me down in the chair, tugging my thoughts and hopes down with them. Down, down, down. A change was in order. A new $500 chair? An iPad? Everything investment is a risk.

So I did what any risk-aware 21st century American would do: I posted my gorgeous Amisco computer desk on Craigslist and waited. I waited and forgot about the desk. Weeks later, two emails popped up, out of the blue. Lo and behold, there was a market for the desk.

What to do? Go with the flow. Linelle pulled out her $65. cash and took the desk away. I think she’ll give it a good home. And when I turned to look at the vacant spot, I had a rush of hope. So many possibilities! I could put a table in the middle of the room to use for cut outs and thinking. I could type standing up (my back had been hurting anyway). I could rethink my entire working life.

So here I am, in my new phase: typing on the top of a tiny old bookcase my mother kept in her bathroom. It’s the right height but a little teetery. I’ll have to look for a larger surface. I’ll have to innovate.

Change is good. It never comes when we expect or even want it. But it’s good.

Sotomayor and Chaotic Moon – stay curious, take risks and get better

Two fascinating encounters this week. Supreme Court Justice Sonia Sotomayor was in town to promote her book. By the time I got there, the crowd spilled out of the second-floor room where she was to appear, down the stairs and into the aisles of books. All ages – moms with kids, octogenarians (holding hands), students scribbling notes. We all pressed together – holding our breaths so we could hear. And yes, she was wonderful.

Sonia Sotomayor visits Austin. Photo by Pearce Murphy, The Daily Texan.

It was inspiring — the crowd, the diversity, the speaker, the very American-ness of it all. Coming on the heels of the inauguration and Martin Luther King Day, even the cynics among us had to take a breath.

Sotomayor closed with a grace note of thanks to her audience, but also a warning: Beware of false pride, she said. It stops the learning experience. I never thought I would be on the best seller list, she continued. But here I am.

A second wake up call — a rambunctious presentation by the irrepressible Whurley of Chaotic Moon — advocated the gospel of creative risk taking: instigate, collaborate and innovate. It was a fun, uppity, polished pitch that challenged us to “just do it” and a testimony to cross-generation collaboration. You need both the gas pedal and the brakes.

Chaotic Moon is pushing the boundaries of the creative “why not,” energizing the innovation efforts of companies like Toyota and Samsung. Sitting in the audience, I was in awe: What a shot-in-the arm their thinking must be to the research and marketing teams of those huge public multi-nationals.

Side note: Whurley differentiated innovation (it’s easy or we don’t do it) and invention (it’s hard), which reminded me of the brilliant Clayton Christensen column from last fall, “A Capitalist’s Dilemma” that made a similar point in relation to job creation.

The connection? Curiosity and action. Sotomayor did not get to the Supreme Court just by acing her tests (though I’m sure that was part of it). She reinvented herself over and over again. She made consistent efforts to create a smarter, more broadly experienced and emotionally mature human being. She took dancing lessons at 50+ (I tell you, there’s something about those dancing lessons).

Two vivid reminders to continue to try, experiment, expand — radically — and get better.

I don’t wanna …

A colleague mentioned that he couldn’t wait until February when everyone’s New Year’s resolutions pooped out, so he could get in and out of the gym faster. I had a sudden vivid memory of waiting in line for a swim lane at the YMCA at 5:30 a.m. in January, shivering my skimpy Speedo and as the minutes ticked by, calculating how long it would take for a slot to open up.

So what happens in February? “I don’t wanna” outweighs “I’m gonna.”

I don’t think I’ve ever done anything worth talking about that didn’t start with “I don’t wanna …” So many excuses, so little time: I’m afraid I’ll fail; it takes too much time and energy; the traffic is bad; I didn’t know anybody there(!).

It's 9 a.m. and you're still in bed? — It’s 9 a.m. and you’re still in bed?

There are people who are smart, gutsy, competent and land in just the right place at just the right time — taking a job just as a company starts its climb back to the top, starting a company just before the market takes off.

But if I dig a bit, those people are disciplined and driven. They have a goal, and they’re committed to achieving it. They are not whiners. They make choices and act. Sometimes they fail. Can anyone imagine anyone more prolific than Seth Godin and his spare wisdom? Or locally, Maura Thomas‘ disciplined hashmarks, Marc Miller’s prolific Career Pivot posts, and Pike Powers’ iconic pike-o-grams?

So, I’m raising one last glass to 2013 and (slightly) revising the iconic Nike slogan: “If it gets you closer to your goal, just do it.”

3 easy steps to cultivating your sense of the ridiculous

Okay, I’ve had it. Fiscal cliffs, elected officials, desertification, homelessness, elephant poachers, capital gains, women’s health funds, underfunded public education, elected officials, dying newspapers, Lance Armstrong, Mopac at 5 o’clock, aging, abandoned children, cats and dogs. It’s all too much. Time for some silliness (if the aforementioned wasn’t the right kind).

Do the following at critical junctures of your day, while reading email, talking on the phone – or my personal favorite – after I’ve done something particularly stupid. It costs nothing, never fails to provide perspective and can be used at home, in the office, car or plane.

You’ll find this trick rarely fails to make you feel absolutely ridiculous — which for some reason opens a world of boundless possibilities. Here goes:

(1). If you know a basic swing dance step, skip to the next paragraph. If not do the following:

Stand feet together
Lift one foot (ladies, your right; gentlemen, your left). Put it back down. That’s Tap-Step.
Other foot: Tap, Step.
First foot: Step backwards and then bring the foot back in place. That’s Rock Behind.
So, that’s the basic swing: 1st foot – Tap.Step. 2nd foot: Tap.Step. First foot: Rock Behind.

(2). When you’re comfortable with the basic step, add a simple variation, a turn:

1st foot: Tap. Step.
2nd foot: Tap. Step.
1st foot: Rock Behind BUT as you bring your foot back into place, place it perpendicular to the other foot, pivoting 1/4 turn away from your 2nd foot. Bring the foot down in a step to pivot back around and face your (virtual partner).

(3). Now, add music. I prefer The Jingle Bell Rock. It is faster-acting than other options I’ve tried, particular when it’s not December.

The Chipmunks do a fine rendition of the classic "Jingle Bell Rock." — The Chipmunks do a fine rendition of the classic “Jingle Bell Rock.”

Use this tool with a music-playing device, device-less or device-free, depending on your attitude. You can sing to accompany yourself. Here are the lyrics. Learning them also helps with memory loss. I’m not sure about hair or weight loss, but could it hurt?

My January IP to you: Silliness. We’re going to need it.

p.s. Here’s the swing in action, but caution: Don’t allow yourself to be put in a mold. It’s the spirit of the thing. Innovate.

A battle cry of innovation

I’ve found my battle cry for 2013: a quote from Georgia O’Keefe (who died at 98 in 1986) that’s tailor-made for a world where best laid plans collide with black swans:

“I’ve been absolutely terrified every moment of my life, and I’ve never let it keep me from doing a single thing I wanted to do.”

Source: Encyclopaedia Britannica: Vol 17 (1943), photographed by Alfred Stieglitz, 1918 © http://www.arttoday.com

The quote suggests that O’Keefe rarely operated in her comfort zone. I looked through a big book of her paintings I bought when I was in college. Each picture is distinctly O’Keefe’s: giant flowers, towering landscapes, skyscrapers. But she somehow struggled to stay raw and alert, testing her premise and refining her distinctive style. She figured out how to get better and better.

It’s really hard not to want to be comfortable, to respond in the same way, go to the same restaurants see the same people, walk the dog on the same safe street. But even if that were possible, it’s not the way I want my obituary written. So I’m trying to make experimentation a habit. The bugaboo is that it it’s neither quick nor easy. I have to let myself block out the time, fail and get better.

At the organizational level, this process is called innovation. Companies and institutions pursue research and development in-house, by participating in incubators (a future post on this intriguing area), through partnerships, strategic alliances and spin offs None of these routes is fool-proof, far from it. Sometimes they work; other times they don’t. It’s all about changing for the better. I mean, who would have thought the local toll road would be doing radio spots, the post office would partner with the grocery store and PayPal, and tiny cars could be rented on the street?

Scary stuff, but oh so necessary.

Thinking in a different way

Now I get it. It’s about thinking differently to tackle big problems like cancer, climate change, floods, droughts, hunger, pandemics. Last week’s Austin Forum showcased the Texas Advanced Computing Center and the University of Texas System’s mind-boggling infrastructure. But it wasn’t until a week later, when I listened to Open Stack’s Jonathan Bryce talk about the cloud that it all fell into place.

Armed with horsepower provided by TACC and UT, M.D. Anderson researchers can see results in one-third to one-half the time of earlier efforts. Visualization overcomes the communication tangles that get in the way of so much sharing. Results can be studied and compared in real time (a picture’s worth …).

Think about it. TACC, with its 10-petaflop supercomputer and super-charged network, can help researchers solve problems in days or even hours that used to take weeks or months. Armed with faster answers, the researchers ask more questions. They collaborate more. They ask different questions and expand the circle of collaboration. More minds, more perspectives, more questions. Perhaps the initial problem morphs into several smaller ones. Perhaps one or more of these is easier to solve.

A high point: A self-described hacker asked if he could pitch in. TACC Director Jay Boisseau responded that yes, there would be collaborative opportunities, individual as well as the collective ones provided by a research park. That’s encouraging news in a world that needs some brain power focused on things that matter. Perhaps future sessions will touch on the process of developing a smart set metrics to guide all of this collaboration.

In the meantime, let’s work on that fiscal cliff.