Introduction to Semicon SCM Allan Chen June 16, 2001.

Introduction to Semicon

SCM

Allan ChenJune 16, 2001

Agenda

• Supply Chain Management (SCM) in

Semicon

• Semicon SCM Components

• Why Supply Chain Management

• Implementation

• Trend and Strategy

Supply Chain Management Supply Chain Management BlueprintBlueprint

Site Factory Planning

• Demand management• Fulfillment management• Allocation/Capacity management• ATP/CTP• Design Collaboration• E-Commerce

• Demand management• E-Procurement

Wafer Testing Final TestingFinal Testing

Semicon Industry

Assembly

• Supply Chain Planning• Global capacity allocation• Demand fulfillment

SuppliersSuppliers CustomersCustomers

ManufacturingProcess

ManufacturingProcess

InspectionInspection

ReceivingReceiving

PurchasingPurchasing

Production Production PlanningPlanning

SupplierSupplierMarketingMarketing

SalesSales

CustomerCustomer

DistributionDistribution

TransportationTransportationRaw

Material

Raw Material Finished

Goods

FinishedGoods

Order PromisingOrder

Promising

ForecastManagement

ForecastManagement

ProductDesign

ProductDesign

Order FlowOrder FlowPurchasePurchaseOrder FlowOrder Flow

Material FlowMaterial Flow Product FlowProduct Flow

Product Product DesignDesign FlowFlow

Integrated Manufacturing SystemIntegrated Manufacturing System

CustomerCustomerSupplierSupplier

What Is A Supply Chain in Semicon?What Is A Supply Chain in Semicon?

A supply chain is a network of facilities that performs the functions of procurement of material,transformation of material to intermediate and finished goods, and distribution of finished products to customers.

60 ~ 70 days

1 - 2 days9 - 14 days 15 - 20 days

Fabrication Probing Assembly Testing

diebank

F/G

FAB IFAB I

FAB 2FAB 2

C/PC/P F/TF/Twaferbank

SubASSYSub

ASSYSubF/T

SubF/T

• The Real Challenge in A Supply Chain - Uncertainty*• Different Sources of Uncertainties Exist along A Supply Chain

– Demand: forecasting mismatch, demand volume, product mix, unexpected changes

– Process: yield, machine downtimes, WIP, process hold– Supply: quality, reliabilities of FAB wafer supply and back-

end capacity supply

*Tom Davis, “Effective Supply Chain Management”, Sloan Management Review, 1993.

ASSY ProcessFAB

ProcessCP

Process

FT Process

DemandSupply

Supply

Supply Supply

Uncertainty Plagues the Supply Uncertainty Plagues the Supply ChainChain

The Semiconductor Supply Chain The Semiconductor Supply Chain Multi-level Supply ChainMulti-level Supply Chain

op2 op3 op4 op5 op6 op7

cop1 cop2 cop3

op8 op9 op10op1

Split Route

bop1 bop2

aop1 aop2

Main Route

op4 bop1 bop3 op9 op10op1Route_1

op4 op6 op7 op8 op9 op10op1Route_2

op2 op3 op4 cop1 cop2 cop3 op9 op10op1Route_3

Wafer process routing

Assembly steps

op5

op5

op5

op2

op2

op3

op3 op6

Split Route

Operation Steps: Semiconductor vs. Assembly

Rework route

Planning complexity for IC manufacturingPlanning complexity for IC manufacturing

0.220.22Lot#2Lot#2

EQP#1x

EQ#2D EQ#2E

• Planning over thousands of Decision Trees

EQP#1

EQ#2A EQ#2B EQ#2C

EQ#3A EQ#3B EQ#3C EQ#3D

EQ#2B EQ#2C EQ#2D

EQ#3B EQ#3C

EQ#50

0.220.22Lot#1Lot#1

OP1OP1

OP2OP2

OP3OP3

OP412OP412

OP413OP413

OP414OP414

0.220.22Lot#3000Lot#3000

0.180.18Lot##Lot##

0.350.35Lot##Lot##

0.150.15Lot##Lot##

EQP EQP EQP EQP EQP EQP

EQP EQP EQP EQP EQP EQP

• Capacity & Capacity & ConstraintConstraint

• Material ConstraintMaterial Constraint• ResourcesResources

Semiconductor SCM Components

SCM Enterprise Application Decision SCM Enterprise Application Decision SupportSupport

Supply Chain Event ManagementSupply Chain Event Management

Order ManagementOrder Management

Warehouse ManagementWarehouse Management

Transportation ManagementTransportation Management

International Trade LogisticsInternational Trade Logistics

Inventory ManagementInventory Management

Production SchedulingProduction Scheduling

Manufacturing PlanningManufacturing Planning

Distribution PlanningDistribution Planning

Supply PlanningSupply Planning

Supply Chain CollaborationSupply Chain Collaboration

Demand Planning and ForecastingDemand Planning and Forecasting

Supply Chain Network DesignSupply Chain Network Design

YearsYearsQuartersQuartersWeeks/MonthsWeeks/Months

Hours/Days

Hours/Days

Seconds/Minutes

Seconds/Minutes

OperationalPlanning

OperationalPlanning

TacticalPlanningTacticalPlanning

StrategicPlanningStrategicPlanning

Supply Chain ExecutionSupply Chain Execution

Supply Chain PlanningSupply Chain Planning


Order PromisingOrder Promising

Inventory ManagementInventory Management


Material & Capacity PlanningMaterial & Capacity Planning

ATP/CTPATP/CTP



Sales and Operations PlanningSales and Operations Planning

YearsYearsQuartersQuartersWeeks/MonthsWeeks/Months

Hours/Days

Hours/Days

Seconds/Minutes

Seconds/Minutes

OperationalPlanning &

Control

OperationalPlanning &

Control

TacticalPlanningTacticalPlanning

StrategicPlanningStrategicPlanning

Supply Chain ExecutionSupply Chain Execution

Supply Chain PlanningSupply Chain PlanningOperations SequencingOperations Sequencing

Shop Floor ControlShop Floor Control

Resource RationalizationResource Rationalization

Semicon SCM Enterprise Application Decision Semicon SCM Enterprise Application Decision SupportSupport

Multi-Site Production PlanningMulti-Site Production Planning

Shop Floor ControlShop Floor Control

Operations SequencingOperations Sequencing

Multi-Level Supply Chain ManagementMulti-Level Supply Chain Management

Material & Capacity PlanningMaterial & Capacity Planning


Multi-Site Capacity ManagementMulti-Site Capacity Management

Resource RationalizationResource Rationalization

Order PromisingOrder Promising

ATP/CTP/PTPATP/CTP/PTP




Sales and Operations PlanningSales and Operations Planning

Multi-Site Production TrackingMulti-Site Production Tracking

Why Supply Chain Management?Why Supply Chain Management?

•Lack of due date projection capability in foundry environment

•Quickly generate ATP & CTP to customer

•Limited visibility into capacity constraints

•Concurrent planning & optimizations of all constraints. Problem windows and real-time simulation capabilities to react in a timely manner

•Weak integration between planning and execution

•Enterprise visibility of planning process and multi-user access enable better process and and convincing results

FactFact

Planning Issues Faced Needs

FactFactCurrent Manufacturing planning issues Needs

•Lack of rapid re-plan capability •Reduce planning cycle time allows daily planning and rapid re-planning

•Lack of detailed execution schedule •With proper modeling, provides detailed execution priority/schedule

•Lack of what-if analysis in variety product mix situation

•Provide what-if analysis capability

• Islands of data, multiple excel spreadsheets consuming vast amounts of planner time

•Single entry of forecasting information, company-wide visibility

•Manual Work with limited dimensional view (e.g. Total volume by Product)

•Automatic tools with both planning and execution data inputs

Future Business Process ChangesFuture Business Process Changes

• Reduce planning cycle from a weekly to daily

• Integrate all fab areas as one team and quick

response for capacity allocation.

• Need a flexible system for start planners for

dynamic capacity situations.

• Solve problems from planning system instead of

execution system.

• Should integrate from customer to turnkey for

Virtual Fab requirement.

Example: Business analysis and solution Example: Business analysis and solution Customer order fulfillment performanceCustomer order fulfillment performance

• Scenario: Good individual site delivery performance but BAD overall delivery

performance, due to lack of integrated manufacturing targets.

• Issues– FABs’ MPS don’t meet CP/ATS’s delivery needs– Invisibility of FABs’ planning/execution changes to CP/ATS– Lack of Push/Pull mechanism for Fab lots under defined target

• Current Status– MPS just cover Fabs only, CP/ATS MPS were generated based on current WIP– Replace projected out date with scheduled out date when lots were delayed– Managed manually

• System Solution– Manage overall capacity for FABs, CPs, ATS, EBO, PC & IE – Generate integrated target for Fab, CP, ATS and EBO by backward planning– Update lot schedule out date for back-end stages by daily – Raise demand/supply changes to drive back-end re-planning– Coordinate FABs/CP/ATS/EBO planning modules for Push/Pull decision– Re-plan for execution violation by weekly

WaferFabrication

CircuitProbing

AssemblyPackaging

FinalTest

Backward planning for plan lots

Commit dueWafer Start

Forward planning for WIP

Wafer Out DateCurrent WIP

Planning LogicPlanning Logic

ImplementationImplementation

Supply Chain Management BlueprintSupply Chain Management Blueprint

PlanningPlanningGlobal Optimization

MES

ExecutionExecutionFab Optimization

Dispatching

.....

Overall Supply Chain Planning

FactoryPlanning

Customer

Fab1Fab2 Fab6 Testing Assembly

Final Test

Demand PlanningDemand Planning AllocationAllocation Capacity PlanningCapacity Planning

Order ManagementOrder Management Output PlanningOutput PlanningFulfillmentFulfillment

Implementation Strategy – Bottom-Implementation Strategy – Bottom-UpUpStep 3Step 3Step 3Step 3

Global CollaborationGlobal CollaborationGlobal CollaborationGlobal CollaborationIncreasing velocity with partners Increasing velocity with partners through collaborationthrough collaboration

Increasing velocity with partners Increasing velocity with partners through collaborationthrough collaboration

Getting start from Manufacturing PlanningGetting start from Manufacturing Planning

• the basis of supply chain management• manageable risks• fast growth requirements for Fabs

Supply Chain LevelSupply Chain LevelPlanningPlanning

Supply Chain LevelSupply Chain LevelPlanningPlanningStep 2Step 2Step 2Step 2

Increasing velocity within Increasing velocity within company supply chain using company supply chain using global plannerglobal planner

Increasing velocity within Increasing velocity within company supply chain using company supply chain using global plannerglobal planner

Step 1Step 1Step 1Step 1 Increasing velocity within each manufacturing Increasing velocity within each manufacturing site using factory planning system site using factory planning system

Increasing velocity within each manufacturing Increasing velocity within each manufacturing site using factory planning system site using factory planning system

Factory LevelFactory LevelOptimizationOptimization

&Planning&Planning


&Planning&Planning


&Planning&Planning


&Planning&PlanningFactory LevelFactory LevelOptimizationOptimization

&Planning&Planning


&Planning&Planning

Implementation Strategy – Top-Implementation Strategy – Top-DownDownStep 1Step 1Step 1Step 1

Global CollaborationGlobal CollaborationGlobal CollaborationGlobal Collaboration

Getting start from Business Process DefinitionGetting start from Business Process Definition

• business goal driven• clear process flow and target• higher level driving force

Supply Chain LevelSupply Chain LevelPlanningPlanning

Supply Chain LevelSupply Chain LevelPlanningPlanningStep 2Step 2Step 2Step 2

Step 3Step 3Step 3Step 3 Factory LevelFactory LevelOptimizationOptimization

&Planning&Planning


&Planning&Planning


&Planning&Planning


&Planning&PlanningFactory LevelFactory LevelOptimizationOptimization

&Planning&Planning


&Planning&Planning

ObjectivesObjectives

• Provide a predictable customer capacity

commitment

• Improve visibility of capacity efficiency

• Improve quality of decision process about allocation

• Improve investment and resource utilization

• Quick response to demand/supply variance

• Improve accuracy of total projected out date

• Enhance customer order tracking visibility

• Improve global SC operation efficiency

• Improve delivery deadline performance

Solution developmentSolution development

? In-house design In-house design Enhance Legacy system!?Enhance Legacy system!?

Software Package ?!Software Package ?!

• Efficiency - Solutions are ready now (6 months for a site)

• Quality - Professional IT skills with domain knowledge

• Expansion - More feasible functions were

implemented

• Maintenance - Easier to make upgrade by vendor

• Market trend -

• Solution was verified by market

• System development and maintenance outsourcing

Software Package !!Software Package !!

ChallengesChallenges• Resources

– Resources consuming

– Need more and more involvement and commitment from users for:• Data Collection and Validation

• Model Design Input & Feedback

• Functionality validation

• Planning Scenario Development and checking

• Legacy system adapting and interfacing

• Tradeoff between a variety of objectives

– Ex. Max Utilization vs. Customer Satisfaction

– Requires management support to synchronize overall and each individual area’s KPIs or measures.

• Business Process Reengineering (BPR)

• PM and team capability

99thth 1010thth 1111thth 1212thth 33rdrd 11stst 22ndnd 44thth 55thth 66thth 77thth 88thth

Implementation Milestone

BSDBSDDSA & PrototypingDSA & Prototyping

ImplementationImplementation

Conv.Conv.

Beta test

RolloutRollout

JV Fabs

RolloutRollout

3 Fabs

TestingTesting

RolloutRollout

2 Fabs

Planning CollaborationPlanning Collaboration

Change managementChange management

Fine tune & Enhancement

7 Months

Fab, Subcon, Mask,CP

Trend and Strategy

From ERP to SCM to Supply Chain From ERP to SCM to Supply Chain CollaborationCollaboration

• support the planning, scheduling, and fulfillment• Allow cross-functional processes to coordinate activities across company departments

ERPERP

SCMSCM

Supply Chain Supply Chain CollaborationCollaboration

• Back-office functions alone• Automate functional processes• Ensure data consistency & integrity• provide a transactional backbone

• help companies interact better with their customers, suppliers, and employees.• Offered as hubs to support joint intra-enterprise and inter-enterprise planning and scheduling

Business Application Business Application EvolutionEvolution

Source: GartnerSource: Gartner

Collaborative Commerce

Design/Engineering/Logistics CollaborationDesign/Engineering/Logistics Collaboration

Go to MarketGo to Market

Design Collab.

InformationSharing

TechnicalSupport, etc.

Communicatione.g. Discussion

PilotRunPilotRun

RiskProduction

RiskProduction ProductionProduction

Engineering Collab.

Evaluation Evaluation Initiation Initiation Design Implementation

Design Implementation

Logistics Collab.

Customer Customer

DocumentSharing

tsmc tsmc

Total Supply Chain ManagementTotal Supply Chain Management

Operations SequencingOperations Sequencing

Shop Floor Control

Shop Floor Control

InventoryManagement

InventoryManagement


Material & Capacity Planning

Material & Capacity Planning

Multi-Site Production

Planning


Planning


Tracking


Tracking

Multi-Site Demand &Capacity Allocation

Multi-Site Demand &Capacity Allocation

Order Management

Order ManagementATP/CTP/PTPATP/CTP/PTP

Demand Planning and Forecasting

Demand Planning and Forecasting



e Foundry Hub Is Emerginge Foundry Hub Is Emerging

• Lab simulation• Design for fabrication• IP library• Knowledge management• Design rules

• PDM• Product Life Cycle Management

• Supply chain management• Logistics management• B2B integration• ERP, CRM

• On-line ordering, auction• Consolidated buying• Liquid market for surplus ( inv, spare parts, equipment)

A Global Collaborative Commerce WebA Global Collaborative Commerce Web

Web-Based B2B Transactions Should SkyrocketWeb-Based B2B Transactions Should Skyrocket

0

200

400

600

800

1000

1200

1400

B2C

B2B

1999 2000 2001 2002 2003

Business-to-Consumer 18 33 52 76 108

Business-to-Business 109 251 499 843 1,331

($ in billions)

Source: Forrester Research.

Global B2B Transaction PotentialGlobal B2B Transaction Potential

0

500

1000

1500

2000

2500

3000

3500

1998 1999 2000 2001 2002 2003

US

Global

($ in billions)

1998 1999 2000 2001 2002 2003

US 39 109 251 499 843 1,331

Global 80 170 390 970 2,000 3,200

Source: Forrester Research.

109% CAGR

Successful IT Strategies for FoundrySuccessful IT Strategies for Foundry

• Put customers at the center of IT systems

• Provide rapid access to fab information remotely

• Cluster fab Manufacturing Execution Systems

• Internet is the standard communication channel with customers

• Integrate with upstream and downstream supply chain

Source: Quincy Lin, Senior Vice President, TSMC

QuickerDocumentDownload

eFoundryTM

Suite

AcceleratingTime-to-volumeTime-to-market

EnhancedDesign

Environment

EnhancedSecurityControl

YieldData

Analysis

Better Operation

Environment

SmootherInformation

Flow

New TechIntroduction

BetterUser

Interface

EnhancedService

ExpandedTechnicalSupport

eFoundryeFoundryTMTM Brings the Virtual Fab to Life Brings the Virtual Fab to Life

Introduction to Semicon SCM Allan Chen June 16, 2001.

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Transcript of Introduction to Semicon SCM Allan Chen June 16, 2001.