With roughly 2,000 employees and about 100 partners, Fairchild Korea Semiconductor records almost $700 million in annual sales. A common practice among many companies is the centralization of IT systems, with communication between branches relying on a central system in the head office. CIO Choi Yang-Ho, however, points to the rapid growth and relative importance of branches in northeastern Asia and advises that each branch have its own IT system, optimized for its particular situation.
Multinational companies commonly base their IT strategies around their head offices. Furthermore, they have traditionally based policies on that of their head office. Choi sat down with Senior Editor Soon A Cho to discuss how Fairchild Korea has handled this.
Fairchild has championed the Common System Common Deployed (CSCD) approach. Using ERP, any branch worldwide can access the same data, in the same way, simultaneously. Unlike the other branches and head office, Fairchild Korea has an electronic settlement system. However, because Fairchild is a global company, Fairchild Korea focused on compatibility with the head office, using a system that functions like a neural network.
What is the companys largest project and business focus these days?
We are now focused on defining deliverables for our supply chain management (SCM) system using i2 technology. We are scheduled to launch later this year and have already completed advanced planning because process management is very important given the characteristics of the semiconductor industry. Production time can be 60 percent of the total time for an IT operation. We expect a complete plan at the end of the month.
We use PeopleSofts ERP in all branches worldwide. The server is located in the head office, and financial statements, closings and all materials movement data is integrated and managed in one place. Engineering Work Bench (EWB) is used for real-time communication with engineers in any branch.
We are developing our IT infrastructure in the U.S. office, and we have built a plant in China, fully automated material warehouses in Hwaseong city (Gyong-gi Province, Korea), and a head office in Bucheon city (also in Gyong-gi Province). FairChild intends to integrate the IT systems of all our branches.
Fairchild Korea in particular is implementing a Manufacturing Execution System (MES), using the products of a Korean company called Miracom Inc. This project is scheduled for completion on Sept. 10. MES supplies the information for optimizing production, from acceptance of orders through production completion. As a result, it plays a critical role for a manufacturing company like Fairchild. MES, like Work Stream, is a system capable of managing the whole production process efficiently.
What are the main strengths of your IT system?
One of our big strengths is that the entire staff of Fairchild Semiconductor can access the same data in the same way from any PC in the world. Another strong point is our dashboard for executives (EIS), which is part of the PeopleSoft ERP system.
Following headquarters policies must be inconvenient at times …
Fairchild has independent servers in several locations across the world, so we apply certain interaction solutions only to the Asia-Pacific region. After the global SCM project launches, that system will require a period of stabilization, and operating a separate server is ideal considering the speed of growth and the relative importance of branches in northeastern Asia. This should be possible now that IT systems are drawing more attention.
IT departments are often seen as money spenders. What about Fairchild Korea? And what is the role of the CIO?
Although it can be long in coming, IT ultimately delivers cost reductions. The role of IT is to smooth out enterprise systems, and the IT department must build around the other departments to yield an efficient process. My mission for the IT department is that we give all company employees the means to live up to their abilities without getting entangled in IT. Personally I think of the CIO as the Chief Idle Officer. Everyone thinks a CIO should be busy, but a busy CIO means there are problems with the IT systems. There is no reason to be busy when the systems are well implemented.