Case Study
UST is trusted advisor to global semiconductor manufacturer over 15-year partnership
OUR CLIENT
This multinational company is one of the largest semiconductor manufacturers in the technology industry. It employs more than 100,000 people and generates approximately $50 billion in annual revenue.
THE CHALLENGE
Overcoming IT outsourcing complexities that hampered project progress
In 2009, the company partnered with multiple technology vendors to supplement its internal project teams but struggled to manage the diverse skill sets and approaches of external IT personnel. The dispersion of IT resources across numerous projects made it difficult to track progress, manage project milestones, and balance the various agendas and viewpoints of the different consulting vendors. The absence of a single, neutral point of contact for each project led to confusion, inefficiencies, delays, and a lack of visibility into the actual status of ongoing projects. The company needed to rethink its IT outsourcing strategy and streamline project management processes to address these issues and ensure efficient, timely project delivery.
THE TRANSFORMATION
Successful outcomes-based engagement model paved the way for innovation
UST recommended an outcomes-based IT consulting engagement model, a novel approach that shifted staffing headaches, costs, and risks away from the manufacturer. By setting up an off-shore development center (ODC) in India, UST could quickly scale staff up or down depending on the project needs and timelines. With this new talent acquisition and management model, the manufacturer doubled productivity, delivering an average of two monthly projects instead of only one. The company also saved approximately $350,000 per month in time and materials costs because it no longer had to staff and supervise external consultants across projects. The new approach enabled business leaders to focus on new, strategic initiatives.
The success of this new engagement model kicked off a 15-year partnership that has led to these additional projects:
End-to-end management of 36 research and development (R&D) labs
After one of the manufacturer’s R&D lab management vendors repeatedly failed audits and lost silicon samples, the manufacturer asked UST to manage the R&D lab. UST conducted a thorough analysis to understand the issues, processes, and staffing needs and presented management recommendations to the R&D leadership team. UST assumed oversight of two labs, and within two years, UST managed all 36 R&D labs, including 15 in India and 14 in Malaysia. In 10 years, none of the R&D labs have failed audits, and the manufacturer has not had to deal with any lab management issues. By outsourcing R&D lab management to UST, the company has been able to focus on its core business.
An automation and efficiency ideation center
After UST noticed that Intel employees were discussing ways to gain efficiencies with automations, UST took the initiative to create an automation ideation R&D lab. When UST showed company leaders that an employee-driven automation initiative saved four hours of human effort, the manufacturer provided funding to expand the lab to handle R&D for 15 simultaneous employee-driven innovation projects. UST’s automation ideation lab led to the development of a custom reference board prototype testing platform that automated 70% of testing, validation, and debugging cycles. Because remote teams can connect to the testing platform, hardware dependencies decreased 100% and prototype testing accelerated 50%.
Core-Flex engagement model
When the company wanted more ownership over some projects than the outcomes-based engagement model allowed, UST created the “core-flex” model. It’s a hybrid approach with 60% of the UST talent working in a dedicated “core” role and 40% of the UST personnel operating in a flexible capacity that can rotate in and out of projects as needed. This “core-flex” model addressed the manufacturer’s need for greater ownership and reduced IT resource costs.
THE IMPACT
Strong relationship unleashes innovation
After forging a supportive, collaborative, trusted relationship over the last 15 years, leaders at this semiconductor powerhouse can focus on what they do best—developing state-of-the-art technology products that fuel the global economy. We’ve helped company leaders resolve critical operational issues that have streamlined processes, reduced costs, introduced innovation, and address unrecognized needs, such as:
- A 2X increase in application development productivity—thanks to the novel outcomes-based talent acquisition and management model
- A $4.2 million annual savings in consulting time and materials—by using a flexible ODC staffing model that streamlined and consolidated its original, multi-vendor outsourcing strategy
- A 20% reduction in project roadmap development cycles—thanks to process optimizations across the enterprise
- Zero failed R&D lab audits—in the 10 years UST has managed the company’s 36 research labs
- Numerous productivity-enhancing automation projects—resulting from the automation and efficiency ideation center, including the custom reference board prototype testing platform that automated 70% of testing, validation, and debugging cycles
RESOURCES
https://www.ust.com/en/digital-product-innovation