E-strategies for aftermarket facilitation in the global semiconductor manufacturing industry

Abstract

PurposeThe paper presents one of the first attempts to identify and categorise the fundamental barriers currently preventing the multibillion semiconductor equipment manufacturing industry from implementing existing B2B e-trading models for its secondary market. It furthermore proposes a global e-business strategy supporting aftermarket integration with the industry's supply chain.Design/methodology/approachBecause of the global nature of the industry, the research employs a multiple case-study design to explore the state-of-the-art in semiconductor excess management. The data for this analysis are obtained through a number of in-depth interviews with experts from a cross-section of the industry, and further supplemented and validated with a systematic literature review and public corporate data.FindingsThe results indicate that significant market imperfections still exist in the industry due to information and knowledge deficits, organisational inefficiency and IP-related concerns. The considerable levels of third-party competition to the original equipment manufacturers raise questions about the existence and efficacy of reverse logistics processes and Closed-Loop Supply Chain (CLSC) management strategies in this industry. It has been shown that a leaner semiconductor supply chain is achievable through the implementation of the proposed B2B e-marketplace, maintaining the information exchange on the surplus/obsolete equipment and parts.Originality/valueThese outcomes are unique for supporting the design of the first global e-marketplace for the secondary semiconductor equipment and spares. The results can, furthermore, inform the standardisation of the semiconductor aftermarket transactions, streamline knowledge exchange mechanisms amongst different industry players and improve pricing strategies. These contribute to knowledge of principles allowing the aftermarket e-trading to become a key part of the value network in high-tech manufacturing industries.

ViewpointEnabling circular supply chains in a high-tech manufacturing industry

“…It also allows the creation of virtual bundles enabled from (9) when a buyer needs to purchase more than one item. At the moment, buyers do not ordinarily use the secondary market for project work which tends to use kits or bundles of parts because the search time is too long and hence the need for an automated bundling approach (Hickey and Kozlovski, 2020). Trading circles (10) address the competitive advantage issues through defined inclusive or exclusive trading partner relationships.…”

“…The general conclusion arising from research of CSCs in the semiconductor manufacturing is that there is significant room for improvement in its aftermarket (Hickey and Kozlovski, 2020). Specifically, the trading activity is clustered with no single trading exchange that is large enough to capture activity on a worldwide basis.…”

“…The proposed platform is furthermore prototyped and applied for the proof of concept to the semiconductor manufacturing as a typical global high-tech manufacturing industry. With this approach, we aim to add value to the industry's major supply chain players which comprise the independent device manufacturers (IDMs), original equipment manufacturers (OEMs) and third-party service providers (Hickey and Kozlovski, 2020). The semiconductor IDM includes such notable names as Intel whereas Applied Materials and Lam Research are amongst the industry's OEM.…”

Demand and supply disruptions during the Covid-19 crisis on firm productivity

“…Second, semiconductor firms are particularly exposed to the bullwhip effect because they are located well upstream in the overall SC (de Kok et al, 2005;Mönch et al, 2018). Third, the industry has undergone substantial value chain challenges with the requirement for technical specialization, skilled engineers, heavy capital expenditures and a rapid pace of development (Hickey and Kozlovski, 2020). Fourth, many semiconductor organisations nowadays operate globally, seeking low-cost production sites, government support, tax benefit etc., which increases their SCs complexity (Mönch et al, 2018).…”

The synergistic effect of ego-network stability and whole network position: a perspective of transnational coopetition network

“…And, it has gradually been observed as a real issue by scholars in recent years. For example, Hickey and Kozlovski used a case study approach to propose a global e-commerce strategy for aftermarket and industry supply chain integration and emphasized the significance of collaboration with competitors in the semiconductor industry (Hickey and Kozlovski, 2020). In recent years, the rise of new information technologies has also deepened the coopetition relationship between firms.…”