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Best in France: Altis Semiconductor

Vincent MAHEO Thibaud MOULIN Louis POULAIN. HEC Master in Large Projects Management . Best in France: Altis Semiconductor. May 2004 Interviews of Franck Bermon, HR Director Pascal Louis, R&D Director Marcus Reisinger, Financial Director. MAP OF ALTIS CASE.

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Best in France: Altis Semiconductor

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  1. Vincent MAHEO Thibaud MOULIN Louis POULAIN HEC Master in Large Projects Management Best in France:Altis Semiconductor May 2004 Interviews of Franck Bermon, HR Director Pascal Louis, R&D Director Marcus Reisinger, Financial Director

  2. MAP OF ALTIS CASE • 1. Presentation of Altis and its challengers • 2. Interviewed People • 3. France, factors of (un)success • HR • R&D • Social and Laws • Finance • Logistic • Quality of life • 4. Multiculture in Altis • Conclusion : Why does Altis stay in France ? Best in France - HEC - May 2004 MAHEO – MOULIN - POULAIN

  3. Presentation People France Multiculture Conclusion PRESENTATION of ALTIS and its CHALLENGERS • IBM on the site of Corbeil-Essonnes in 1941 • IBM Microelectronics is created there in 1964, first advanced components manufacture in Europe • in the early 90’s, Siemens works on a technical project in the site of Corbeil • the financial sky of IBM Microelect. looks stormy and to save the company, a 50/50 joint-venture between IBM and Infineon (Siemens) is created in July 1999. AltisSemiconductor was born. 2500 people 578 M€ (gross income 2001) Logics Flash memory a revolutionary R&D project: MRAM 40% sales in Europe 15% of mobile phones use Altis components Best in France - HEC - May 2004 MAHEO – MOULIN - POULAIN

  4. Presentation People France Multiculture Conclusion PRESENTATION of ALTIS and its CHALLENGERS in Europe: Siemens and their famous semiconductor center in Dresden (Germany) the twin manufacture of Altis in Asia: Taïwan, China, Korea... many foundries with low costs but not a so high technology and IP issues in the USA: not so many on Altis’ sector Best in France - HEC - May 2004 MAHEO – MOULIN - POULAIN

  5. Presentation People France Multiculture Conclusion INTERVIEWED PEOPLE • Franck Bermon, HR & Communication Director • Social & Laws aspects • Operating and managing qualities • Subsidies • Pascal Louis, New Technologies Director • Research in France • Operating and managing qualities • State structure • Marcus Reisinger, Financial Director • Managing in France, Germany and the USA • Taxes and salaries • Investment policy Best in France - HEC - May 2004 MAHEO – MOULIN - POULAIN

  6. Presentation People France Multiculture Conclusion HUMAN RESSOURCES • to work 24h a day, Altis needs 5 teams whereas US and Asian need only 4 (vacation, work time) • Asian salaries are not comparable to French • in this sector, investments are huge so the impact of higher salaries is reduced: 15 to 20% of costs 20 to 25% less for competitiveness • French engineers have a general education and are creative • French need a strong boss who takes final decisions on his own and do not appreciate to find a consensus (≠ German) • Not enough technicians in France Best in France - HEC - May 2004 MAHEO – MOULIN - POULAIN

  7. Presentation People France Multiculture Conclusion RESEARCH & DEVELOPPMENT • Partnership with high level Universities (Orsay) • IBM has decided to give a revolutionary R&D projet, MRAM to Altis, why ? • pre-existing R&D engineering • close from Orsay Univ. (the creators of MRAM) • state subsidies Best in France - HEC - May 2004 MAHEO – MOULIN - POULAIN

  8. Presentation People France Multiculture Conclusion SOCIAL and LAWS • Laws: Intellectual property well protected (≠ Asia)  Flexibility hardly possible (≠ world) • Syndicates: embarrassing partners... • Important role of politics: the mayor of Corbeil, Serge Dassault, very close from the current government has put pressure to get important subsidies from MRAM project • To handle with all complex administrative issues, foreign companies have to hire French specialists (≠ USA) • Government structure not appropriate to companies: Research and Industry administrations do not walk the same way Best in France - HEC - May 2004 MAHEO – MOULIN - POULAIN

  9. Presentation People France Multiculture Conclusion FINANCE • Subsidies: in France, the system is very complex (many actors from the State down to the city), they are low and only dedicated to projects (≠ China, rusty sites: Dresden) • Taxes: very high (≠ USA) and complex (≠ Germany) for the company and its employees. But the SC sector is in crisis, and a company does not pay taxes if it looses money... • Banks: only international banks can deal with this amount of investment, so no specially French banking behaviour • Investment: French think more on a long run (≠ USA, IBM’s demand for ROI=6 months !) and take less risks (=Europe) Best in France - HEC - May 2004 MAHEO – MOULIN - POULAIN

  10. Presentation People France Multiculture Conclusion LOGISTIC • the proximity of the two Parisian airports is important: all products are delivered by air and 60% are sent out of Europe Best in France - HEC - May 2004 MAHEO – MOULIN - POULAIN

  11. Presentation People France Multiculture Conclusion QUALITY of LIFE • the French way of life is an advantage to convince foreigners to work in France • Paris and its prestige is well appreciated by singles • the Parisian suburbs are a good location for families with their international schools Best in France - HEC - May 2004 MAHEO – MOULIN - POULAIN

  12. Presentation People France Multiculture Conclusion MULTICULTURE in ALTIS • triple culture: French, German and American (advantage for managers) • 15 nationalities (~40 German) • languages problems • less cultural differences between a French and a German than between an engineer and a commercial Best in France - HEC - May 2004 MAHEO – MOULIN - POULAIN

  13. Presentation People France Multiculture Conclusion CONCLUSION: WHY DOES ALTIS STAY IN FRANCE ? • now, on Altis’ sector, engineering is more important than costs • Intellectual Property is a major issue • an important part of Altis’ clients are European • France keeps its leading position, but until when ? • China developps their engineering education • With high level engineering and low costs, there will last only one point to prevent Altis from relocating in China: IP Best in France - HEC - May 2004 MAHEO – MOULIN - POULAIN

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