Best in France: Altis Semiconductor

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Best in FranceAltis Semiconductor
Vincent MAHEO Thibaud MOULIN Louis POULAIN
HEC Master in Large Projects Management

• May 2004
• Interviews of
• Franck Bermon, HR Director
• Pascal Louis, RD Director
• Marcus Reisinger, Financial Director

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MAP OF ALTIS CASE

• 1. Presentation of Altis and its challengers
• 2. Interviewed People
• 3. France, factors of (un)success
• HR
• RD
• 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
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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 90s, 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. Altis Semiconductor was
  born.

2500 people
578 M (gross income 2001)
Logics
Flash memory
a revolutionary RD project MRAM
40 sales in Europe
15 of mobile phones use Altis components
Best in France - HEC - May 2004 MAHEO MOULIN
- POULAIN
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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
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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
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Presentation People France
Multiculture Conclusion
RESEARCH DEVELOPPMENT

• Partnership with high level Universities (Orsay)
• IBM has decided to give a revolutionary RD
  projet, MRAM to Altis, why ?
• pre-existing RD engineering
• close from Orsay Univ. (the creators of MRAM)
• state subsidies

Best in France - HEC - May 2004 MAHEO MOULIN
- POULAIN
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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
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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, IBMs demand for ROI6 months !) and take
  less risks (Europe)

Best in France - HEC - May 2004 MAHEO MOULIN
- POULAIN
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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
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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
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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
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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