Partnering is key to success in the semiconductor industry, but it’s difficult to identify potential partners and avoid the pitfalls of partnering. This comes out of a report by the National Microelectronics Institute (NMI).

The need for partnering has been accentuated by the symptoms of globalisation e.g: more competition; shorter product lifetimes; rapid technological change (though this has been a semiconductor industry characteristic for half a century); global access to human capital, and access to foreign markets.

The pitfalls of partnering are described by the report as: the risk over becoming dependent; risk of becoming locked-in to a supplier; takeovers, acquisitions, management changes; market changes; mis-aligned timing on commercial needs; asymmetric effort/reward; choosing the wrong people to manage the relationship; IP leakage; patent and legal issues; cultural issues.

Partnerships are useful both on the supply side and the demand side. On the supply side these develop from conventional supplier-customer relationships. On the demand side these evolve in a number of ways. Publicity announcements; trade shows; public speaking; developer programmes; user communities; industry dinner meetings and sheer luck.

The NMI report adopts the Americanism ‘ecosystem’ to describe the resultant web of suppliers and customers, and describes how ecosystems can join up with other companies’ ecosystem creating 3D models.

It makes the important point that these relationships need to be constantly monitored and re-calibrated if they are to deliver value.

Partnering is an important area for all companies, new and old, in the semiconductor industry, and it would be useful if the NMI published the research data on which the report is based, because the report’s language is far from succinct. For instance the use of the word ‘dyadic’ as a synonym for ‘joint’, (P.49 para 9.1.1) is bound to raise a weary eyebrow or two.