The Ongoing Challenge - Tutorial The Illusion Of Capacity

1. The Ongoing Challenge - TutorialThe Illusion Of Capacity Incorporating the Complexity Of FAB Capacity (tool deployment, routes, & operating curve) into Central Planning (with fixed linear representation of capacity and cycle time)for Demand-Supply Networks for the production of semiconductor based packaged goods with substantial non-FAB complexity Basics part 1 of 4 that has a part 5 Dr. Ken Fordyce & John Fournier, IBMProf. John Milne, Clarkson University (IBM retired) & Dr. Harpal Singh, CEO Arkieva * Dr. Horst Zisgen, IBM, Rich Burda IBM, Gary Sullivan (IBM retired), Peter Lyon (IBM retired), Prof Chi-Tai Wang NCU (Taiwan) (IBM 1998-2009) Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

2. Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

3. Theme for This Afternoon’s Feature Presentation isThe Hunt forCAPAVAIL(capacity available)and CAPREQ (capacity required)in central planning engines Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

4. IBM has >> PROFIT (CPE) (Edelman, Wagner) and >> EPOS (Wagner, MASM) why? Answer Question End to end demand supply network plan300mm EFK FAB planningLoosely coupled with wafer starts and cycle time Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

5. “Creation of the Plan is simply the start of the planning and commit process, not the end point. The Plan is information for planners, executives, & finance. Additionally it helps set dispatch scheduling priorities Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

6. Rule 001 for capacity hunters • All models are wrong, some models are useful • All models are approximations that balance • “ease of use” • with accuracy. • This balance changes over time in both directions Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

7. Outline (1 of 3) • Overview of the Demand Supply Network for the production of semiconductor based package goods • Warring factions • Decision Tiers • Aggregate FAB Planning • Central Planning • Two major challenges • Planned lack of tool uniformity • Inherent variability Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

8. Outline (2 of 3) • Basics of Aggregate Factory Planning • Can this wafer start profile be supported • Near Term Deployment • WIP Projection • Basics of Central Planning • Basic Functions • Historical emphasis on non-FAB complexity • Alternate BOM for example • Handle FAB Capacity with limits stated as wafer starts • Wafer start equivalents evolved to nested wafer starts (date effective) • Fixed, but date effective cycle times • Second look at capacity (CAPREQ and CAPAVAIL) • Linear methods in central planning engines • FAB complexity creates miss match Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

9. Outline (3 of 3) • Operating Curve and Cycle time Tax • Creating CPE type capacity from routes and consumptions of tools • The complexity of deployment • Illustrating complexity of interactions and Illusion of Capacity • Central Planning Engine Challenges • Robust and detailed estimate of what a FAB can do under what conditions • Clearing Functions • WIP Simulation • EPOS • Dynamic Network of Planning Tools - challenge Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

10. Overview of Demand Supply Network for the production of semiconductor based package goods Warring factions Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

11. Simple view demand supply network for production of semiconductor based packaged goods Wafer_2 cycle time = 60 days; start of BOM chain; one wafer makes 200 devices Device_2 cycle time = 3 days; requires 1/200 unit of Wafer_2 to build Module_2 cycle time = 8 days; requires 1 unit of Device_2 to build Card_2 cycle time = 4 days; requires 2 units of Module_2 to build; end of BOM chain Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

12. Simple view demand supply network for production of semiconductor based packaged goods Wafer_2 cycle time = 60 days; start of BOM chain; one wafer makes 200 devices Device_2 cycle time = 3 days; requires 1/200 unit of Wafer_2 to build Module_2 cycle time = 8 days; requires 1 unit of Device_2 to build Card_2 cycle time = 4 days; requires 2 units of Module_2 to build; end of BOM chain Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

13. Finished Mod. Y Finished Mod. Z Finished Mod. W Finished Mod. X Sort A Sort B Sort C 60% 50% 70% 30% 30% 40% 20% Module 1 Module 2 Module 3 Device (Fast) Device (Medium) Device (Slow) 10% 60% 30% Device (Untested) Wafer BEOL other BEOL wafers = BOM Wafer FEOL other FEOL wafers = Alternate BOM = Binning Raw Wafer = Substitution POST FAB Total Journey FAB Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

14. MUV Implant Strip Wets MUV MUV Implant Implant Strip Strip Wets Wets FAB Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

15. Prod A MUV Implant Strip Wets MUV MUV MUV Implant Implant Implant Strip Strip Strip Wets Wets Wets MUV Implant Strip Wets Prod B Oper A-1 Tools 1, 2 Oper A-2 Tools 2, 3 Oper A-3 Tools 3 3 passes Oper B-1 Tools 1, 2 Oper B-2 Tools 2 2 passes Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

16. Overview of the Demand-Supply Network • Organizations can be viewed as an ongoing sequence of loosely coupled activities where current and future assets are matched with current and future demand across the demand-supply network. • These planning, scheduling, and dispatch decisions across a firm’s demand-supply network are best viewed as a series of information flows and decision points organized in a decision hierarchy or tiers and further classified by the type of supply chain activity creating a grid for classification. Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

17. Central Planning At best loosely and narrowly linked FAB Planning Different Groups Different summary methods for capacity, routes, & lot priorities Focus on tools, starts, and wafer output routes, reentrant flow, Deployment, lot priorities Operating curve, a bit of headache FAB is an entity that makes Wafers “I just want my wafers” Focus post FAB Challenge Better linkage? How much complexity is needed? How much can be absorbed? Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

18. Two Major Challenges From FABS Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

19. Focus Two Major Challenges Deployment (alternative machines) • Planned Lack of Uniformity - not all tools for a manufacturing process have identical profiles • What operations they handle • Their production rate • How does this impact capacity available • Inherent Variability - in the manufacturing line forces us to plan for unused capacity (tools ready to go, but idle due to lack of WIP) to meet the lead time or cycle time objective - Operating curve • trade-off between utilization and cycle time • Trade-off between output and cycle time • Trade-off between wafer starts and cycle time • Trade-off effective capacity available and cycle time Of course Reentrant flow, single wafer, batching, Process time windows, long raw process times Changing demand / start patterns OP Curve Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

20. DeploymentFAB Capacity includes a set of partial matches between individual resources (tools) and manufacturing activities (operations) • Deployment decisions that restrict which manufacturing activities a tool is permitted to process • Manufacturing engineering requirements that limit actual deployment • Different inherent rates of production (PPH) between tools that service the same manufacturing activity • Variation in rates day to day for the same tool depending on floor opportunities for batching, trains (operational chains), parallel factors, etc • Variation in the percentage and distribution of tool availability More on this later Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

21. Deployment Ingredient # 1 Which Tools Can Handle Which Operations 1 – oper/tool link active 0 – not allowed Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

22. Deployment Ingredient # 2 RPT per widget per time unit for Tool / Operation Pairing Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

23. Operating Curve • Trade off between • tool utilization and lead time / cycle time or • Output (starts) and cycle time • Effective capacity available and cycle time • Move along the curve • Pick a cycle time, get a tool utilization / capacity available • Pick a tool utilization (capacity) / get a cycle time • Shift the curve down and right • Less variability, lower cycle time for the same tool utilization • Cycle time is often measured as a multiplier of raw process time (RPT) called cycle time multiplier (CTM) • Some times called XF (x factor – for multiplier) • Cycle time = CTM x RPT More on this later Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

24. Required idle time without WIP Can be viewed as a Tax to Achieve a certain cycle time Operating Curve Basics To maintain the same cycle time But increase tool utilization Requires “shifting” curve Dow and to the right “cheating” the tax man Old concept within industry Thinking how this relates to clearing function For Blue Operating Curve to achieve a CTM of 5.00 Requires accepting Tool utilization of 80% If you are willing to accept CTM of 6.0 Then you only Have to accept 17% unused capacity Which Means you plan to have 20% of your capacity to SIT IDLE due to lack of WIP Reduce variability Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

25. Basics of FAB Planning Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

26. Outline • Overview of the Demand Supply Network for the production of semiconductor based package goods • Warring factions • Decision Tiers • Aggregate FAB Planning • Central Planning • Two major challenges • Planned lack of tool uniformity • Inherent variability • Basics of Aggregate Factory Planning • Can this wafer start profile be supported • Near Term Deployment • WIP Projection Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

27. Basics of FAB Planning • Focus on matching assets with demand • Three major classes • Aggregate FAB planning • Deployment or near term tool planning • WIP Projection • Forward flow of starts dominate method as opposed to pulling to meet demand • Wide variation in methods • Wide variation in how much FAB complexity of • deployment • operating curve is handled Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

28. Basics of Aggregate FAB Planning Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

29. Basics of Aggregate FAB Planning • focused on assessing the ability of the factory to meet certain demand looking to identify “broken” (insufficient capacity to meet demand) toolsets and creating the capacity inputs required by central planning. • Demand is stated as a starts profile and a lead (cycle) time commit for each part. • Various levels of sophistication in handling operating curve, deployment, mix variability, etc • The key challenges for the factory planner are: • Determine if the workload can be allocated across the tools in such a way that all of the workload can be allocate without violating capacity constraints • If insufficient capacity exits • find the optimal mix of workload that can be met without violating capacity constraints • find the optimal allocation that either minimizes additional capacity needed incorporating some type of fair share of pain • Except for advanced methods tough to handle cycle time output trade-off; even with “methods” culturally upsetting Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

30. Basics of Central Planning for the entire demand supply network (supply chain) for the production of semiconductor based packaged goods Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

31. Outline • Overview of the Demand Supply Network for the production of semiconductor based package goods • Warring factions • Decision Tiers • Aggregate FAB Planning • Central Planning • Two major challenges • Planned lack of tool uniformity • Inherent variability • Basics of Aggregate Factory Planning • Can this wafer start profile be supported • Near Term Deployment • WIP Projection • Basics of Central Planning • Basic Functions • Historical emphasis on non-FAB complexity • Alternate BOM for example • Handle FAB Capacity with limits stated as wafer starts • Wafer start equivalents evolved to nested wafer starts • Second look at capacity (CAPREQ and CAPAVAIL) • Linear methods in central planning engines • FAB complexity creates miss match Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

32. Information from Factory – projected completion of WIP, capacity statement, lead times Demand Statement Central Planning Model has key relationships Enterprise Wide Central Plan- match assets with demand Reports on at risk orders, capacity utilization, projected supply Signals to factories Signals to available to promise (ATP) Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

33. Information from Factory – projected completion of WIP, capacity statement, lead times Demand Statement • Information from FAB • projected WIP completion • capacity statement • lead or cycle times Central Planning Model has key relationships Enterprise Wide Central Plan- match assets with demand Reports on at risk orders, capacity utilization, projected supply Signals to factories Signals to available to promise (ATP) Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

34. Basics of Enterprise Wide Central Planning • Create a demand statement • Capture the flow of materials in the demand supply network • Gather and collect key information from the factory • Project the completion of WIP to a decision point (often completion of the part). • a statement of capacity required and available • a statement of lead time or cycle time to complete a new start • Create a model captures key relationships (Central Planning Engine – CPE) • Create an enterprise wide central plan by matching current and future assets with current and future demand using the CPE to create a future projected state of the enterprise and the ability to soft peg the current position of the enterprise to the projected future position. Information from the model includes • a projected supply linked with exit demand • identification of at risk orders either to a commit date or request date • Synchronization signals across the enterprise • Capacity utilization levels • Ability to traceproduction & distribution activity that supports meeting a demand Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

35. Basics of Central Planning Engine (CPE) • Core task is deploy modeling methods to match assets with demand across an enterprise to create a projected supply linked with demand and synchronization signals. • CPE has four core components: • represent the (potential) material flows in production, business policies, constraints, demand priorities, current locations of asset, etc., and relate all this information to exit demand. • capture asset quantities and parameters (cycle times, yields, binning percentages, etc.). • search and generate a supply chain plan, relate the outcome to demand, and modify the plan to improve the match. • display and explain the results. Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

36. Emphasis on Optimal Allocation of Supply to Demand Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

37. Device_12 Supply Amt Supply Amt Day Day Day Sup Amt Amt 00 00 00 ? 10 ? 02 02 02 ? ? 30 10 10 10 ? ? 20 Module_1 CT = 10 days Module_2 CT = 4 days Dem Dem Due day Due day Amt Amt C A 05 10 10 8 B D 12 06 15 2 Allocate supply Of devices to Modules 1 & 2 **Device Supply is starting point Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

38. Which Solution is better? It depends on demand priorities Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

39. Key Tasks • Allocation of perishable (capacity) and non perishable assets (inventory) to best meet prioritized demand • Handle binning and down grade substitution • Complex binning, general substitution, and alternative BOM • Lot sizing • Sourcing • Fair share • Customer commit and request date • Min starts • Date effective parameters • demand perishability, squaring sets, soft capacity constraints, alternative capacity, pre-emptive versus weighted priorities, splitting demand to match partial delays in supply, stability, express lots, delay assembly to test, dispatch lots • foundry contracts ?? Cycle time – output trade-off ?? Complexity of FAB tools Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

40. Allocating Supply to Demand with Complex Alternative Paths (BOM) Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

41. untested deviceWIP = 40on Day 2 Module_8demand = 20priority = 8 Device_8Ainventory = 20 P0 20% P1 40% Module_9demand = 20priority = 1 Device_8Binventory = 0 P2 40% substitution Device_8Cinventory = 0 P2’ substitution can be viewed as an alternative process P2’ Complex binning, general substitution, and alternative BOM Goal is to make best use of existing WIP and capacity To best meet demand and minimize new starts Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

42. untested deviceWIP = 40on Day 2 8 Module_8demand = 20priority = 8 Device_8Ainventory = 20 P0 20% P1 16 40% Module_9demand = 20priority = 1 Device_8Binventory = 0 P2 proj. supply of device(future inventory) 20 40% 4 substitution Device_8A is .20 x 40 = 8 16 Device_8B is .40 x 40 = 16 Device_8Cinventory = 0 P2’ Device_8C is .40 x 40 = 16 substitution can be viewed as an alternative process P2’ This Solution Meets all demands And does not require “new starts” Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

43. Wafer_2 cycle time = 30 days, start of BOM chain, one wafer makes 200 devices 30% 25% 45% Device_2A 30% of Wafer_2 sorts to Device_2A Device_2B 45% of Wafer_2 sorts to Device_2B Device_2C 25% of Wafer_2 sorts to Device_2C P_1 P_2 P_1 Module_2 cycle time = 6 days, made via process P_1, consumes 1 unit of Device_2A Module_2 cycle time = 8 days, made via process P_2, consumes 1 unit of Device_2B Module_A cycle time = 9 days, made via process P_3, consumes 1 unit of Device_2C Module_2 10% of Module_A becomes Module_2 Alternative processes (methods) to make Module_2, i.e., Module_2 stocks from three production paths 10% 90% Module_AA 90% of Module_A becomes Module_AA Location: VEND001 Location: VEND002 Card_2 cycle time = 2 days, made at vendor VEND001, requires 2 units of Module_2 Card_2 cycle time = 4 days, made at vendor VEND002, requires 2 units of Module_2 Alternative vendors to make Card_2, i.e., Card_2 stocks from two vendors Modules and alternative BOM Simple View of Wafers 1 Complex View of Modules 2 Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

44. Historically Central Planning Engines Have focused on non-FAB challenges Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

45. Historically Central Planning Engines Handle FAB Capacity with Nested Wafer Starts (Exits) Separate from cycle time CAPAVAIL stated as maximum Number of wafer starts allowed per day For various groupings of parts Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

46. nested Wafer Start (exit) limits Logical evolution from Wafer start Equivalents Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

47. Review Wafer Start Equivalents Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

48. History • Historically FABs have stated capacity in wafer starts and “traded” starts using wafer start equivalents (ratios) to limit daily wafer starts into manufacturing • For example if my FAB produces three parts and the pinch point toolset is photo, the pass count numbers might be • In this case each Part 003 is “worth” two Part 001; two Part 002 are worth “three” Part 001, etc • All of the capacity elements of the FAB are “summarized” in one single statement of capacity that is completely removed from actual resources (capacity) consumed Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

49. Wafer Start Equivalentslogical evolutionto nested Wafer Start Limits Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL

50. History – evolved to nested set of limits • The overall FAB limit is stated in terms of wafers per day and that each product is mapped to one or more limit. The current methodology allows the CPE to start up to, but not over any limit to which products are mapped. Fordyce, Fournier, Milne, Singh Illusion of FAB Capacity in Central Planning – hunt for CAPAVAIL