SEMI study identifies eBusiness opportunities By Christina Bruns WaferNews Associate Editor The results of a recent eBusiness study conducted by SEMI (Semiconductor Equipment and Materials International) San Jose, CA, found that knowledge management, supply chain integration and customer relationship management are the key areas the industry needs to address. Earlier this year, SEMI assigned Andersen LLP (formerly Arthur Andersen) with the tasks of assessing the impact of eBusiness on the industry, identifying key areas of eBusiness opportunity for SEMI member companies, and identifying appropriate roles for SEMI in supporting members’ eBusiness initiatives. “We found that there’s still a little bit of confusion out there more than anything else as to what the different areas mean. And that’s why our members are sitting on the sidelines,” Tom Salmon, SEMI’s director of business development, told WaferNews. Knowledge management is the ability to exchange data along the supply chain, Salmon explained, whereas supply chain integration involves the actual transactional systems so people are able to smooth the flow of data and spare parts. Customer relationship management includes areas many of SEMI’s member companies felt were important but still hadn’t been thoroughly explored, according to Salmon. “The study was meant to be externally focused [on] opportunities for our members and the impact of eBusiness,” Salmon explained. According to the study, an industry analysis, member interviews and workshops in Japan and California identified high-potential business opportunities. One suggestion that came from the study was to use knowledge management tools to leverage intellectual property and support business analytics. Another idea involved focusing on supply chain efficiency and integration in addition to deploying applications that improve the customer relationships. The implementation of eDiagnostic tools was also recommended, along with participation in digital markets and the adoption of web standards for interoperability. Member companies also identified specific eBusiness roles for SEMI in the US, Europe and Asia Pacific regions, beginning with the recommendation that the organization create an industry portal and sponsor online communities. They also suggested that SEMI develop and promote interoperability standards and guidelines, and support eLearning and certification programs. Additionally, companies advised the association to support the creation of intercompany and marketplace security standards and policies. Lastly, companies recommended that SEMI provide real-time competitive benchmarking intelligence. SEMI members were surveyed about the importance of the role of eBusiness in their organizations. The association found that 58% of its member companies said eBusiness was “critically important” while 42% said it was “somewhat important.” Putting their money where their mouths are, companies have increased expenditures in the eBusiness area. According to the study, members with sales greater than $25 million spend 5 to 30% of their IT budgets on eBusiness. This figure has increased approximately 5 to 25% compared to last year, an increase driven by spending on Enterprise Resource Planning implementations, initiatives in the Asia Pacific region that stimulate investment, and the global shift to eBusiness solutions by customers and suppliers. SEMI members with sales under $25 million spend 5 to 15% of their IT budgets on eBusiness. The study said small- and medium-sized member companies are spending more conservatively this year compared to last year, but are still reporting modest increases year-over-year. The bigger member companies are influenced by pressure from larger trading partners, government grants and initiatives in the Asia Pacific region that stimulate investment, and an increased awareness of eBusiness solutions. Member companies have been working hard to implement a variety of eBusiness solutions, the report said, and are planning aggressively for the future. Despite this, companies have faced some obstacles that have slowed adoption. In the US, the study cited commoditization concerns, resource constraints, changing supply chain roles, security issues, and eBusiness understanding and information availability. In Japan and the Asia Pacific region, SEMI found that inadequate infrastructure, lack of market data and information to plan and forecast, slow adoption of new eBusiness integration strategies, government regulation and policies deter new entrants, and a deeply rooted, multi-tiered distribution system all compound the problem. In Europe, some of the eBusiness challenges include lack of infrastructure, complex taxation rules, risk of intellectual property exposure and an inconsistent legal framework. “We’re focusing a lot of our effort working with various e-business standards companies, [mainly] RosettaNet, to help better define those standards within the scope of our industry,” said Salmon.