February 4, 2007 9:00 PM PST

AMD plucks new manufacturing chief from IBM

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Advanced Micro Devices has appointed IBM veteran Douglas Grose as head of manufacturing, one of the company's most crucial executive positions.

As senior vice president of technology development, manufacturing and supply chain, Grose replaces Daryl Ostrander, who is retiring.

Improved manufacturing has been one of the primary pillars in the turnaround at AMD in the past five years. Historically, the company periodically stumbled because of delays or problems with manufacturing. Kevin Krewell, a former AMD employee and analyst, once joked that while Intel had a rigorous manufacturing ethos of "copy exactly," AMD had one that could be called "somewhat similar."

This situation began to change under Bill Siegel and continued under Ostrander. AMD now regularly wins awards and accolades for its manufacturing. It has also come up with a method that it calls Automated Precision Manufacturing, which lets the company tweak the manufacturing recipe of a single wafer as it moves through the entire production process--a process that can takes weeks. In the past, semiconductor makers had to run several wafers, look at the results, and then adjust the formula. APM lets AMD correct problems more rapidly.

While continuing the work on APM, Grose said in an interview, AMD will also increasingly emphasize lean manufacturing techniques to reduce waste. "It is a grassroots effort that started in manufacturing and will spread across AMD," he said.

Grose will also oversee procurement and AMD's relationships with the foundries, or chip manufacturers for hire. Starting last year, Singapore's Chartered Semiconductor started to produce microprocessors on behalf of AMD. It was an unusual move: microprocessor manufacturers have tried to outsource in the past, but the relationships often fell apart. So far, the Chartered relationship is going well, and the company will begin to take on more advanced chips, Grose said.

Selecting an IBM-er to head up manufacturing is a natural move. IBM and AMD are linked in a long-term alliance to develop manufacturing technology. A substantial number of AMD's top executives came to the company from IBM (like CTO Phil Hester) or Motorola (CEO Hector Ruiz).

AMD's next major manufacturing challenge will be in moving to mass production of 45-nanometer chips. Chips made on the 45-nanometer process will be radically different in many ways than chips made on the current 65-nanometer process; one of the biggest changes is that the transistor gates, which control the flow of electrons, will be made of metal, rather than silicon. AMD says it will introduce 45-nanometer manufacturing in 18 months, rather than the usual 2 to 2.5 years the company takes between manufacturing jumps.

Dan Hutcheson of VLSI Research, a consulting firm that studies chip manufacturing, has said that AMD appears to have already reduced a number of roadblocks toward mass manufacturing these chips and that the goal is " definitely doable."

Competitors, though, have noted that almost no companies in recent decades have advanced manufacturing that quickly. If AMD is successful, it will reduce Intel's lead in moving to new manufacturing techniques from a little over a year to just six months.

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manufacturing, AMD, microprocessor, IBM Corp., relationship

 

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