Overview and Challenges
However, challenges are abound. Shorter shelf lives, rapid obsolescence of technology and competitive demands has led to the semiconductor industry playing catch-up and in the process slowed down the industry growth. Coupled with this, rising costs of R&D and a weak economy has added to the woes of many semiconductor companies who are struggling to contain operational costs and cope with unpredictable scenarios such as supply chain disruptions due to the natural disasters of Japan and Thailand.
However, a handful of semiconductor players have consistently performed through the cyclical variance of the industry. To achieve this kind of performance, semiconductor companies must optimize returns on capital by executing operational-improvement programs such has making lean operational improvements, targeting profitability, improving asset utilization and improving integrations with suppliers and vendors to further improve return on capital.