The Circular Economy: 3 ways to drive business value
The environmental benefits from the circular economy are widely known, such as the reduction of waste and conservation of energy. What is overlooked is the true business value of circularity.
Many companies in the semiconductor industry have taken steps towards circularity, but to truly reap the benefits, the industry needs to move to a results-orientated strategy that closely links the customers’ goals and objectives to the suppliers’ goals and objectives.
The full explanation of this transition is explored in a recent Semiconductor Digest Blog: Upstairs/Downstairs: Chamber to SubFab.
The results-oriented model means moving away from ownership of equipment and transactional maintenance services, to an agreement where the customer pays for the ability to reach agreed performance goals. In the context of key fab performance metrics, one catastrophic failure of a turbo pump has huge implications on wafer output and total cost of ownership. In many fab operations, unplanned events like this may occur tens of times per year.
When a result-oriented model is applied, there are 3 key areas of business value:
- Reduce risk and disruption during manufacturing through sharing risk and common goals. If we avoid catastrophic failure there is less damage to the product and less disruption and loss in the customer’s process. Once the risk is controlled, inefficiencies in other aspects of the process, like spare parts inventories, can be identified and reduced. Read use case.
- Full utilization of assets before repair of remanufacture. Moving from a time-based servicing to a proactive approach to maintenance can achieve a 25% increase in pump lifetime. This is achieved through combining predictive analytics with specific domain knowledge. Read use case.
- Guarantee access to the most robust, reliable and repairable products and processes that meets exact performance requirements as performance has a direct impact on the supplier’s bottom line. Read use case.
Full realization of these benefits does not come without significant challenges and transformation. These changes include a fundamental re-thinking of the way assets are designed, manufactured, used, re-used and owned. It also requires collaborative engagement between manufacturer and customer with intimate sharing of information, goals, risks and rewards; and a holistic operational approach to managing assets.