Semiconductor IP News and Trends Blog

Automotive IP Heuristics Apply to Semiconductor Markets

Lessons learned in both global automotive-product and process-intellectual-property management and outsourcing ring true for the semiconductor world.

While perusing the Society of Automotive Engineers (SAE) International’s vast vault of peer-reviewed papers, I chanced upon one about intellectual property (IP) and outsourcing. This work uniquely focused upon broad issues in both product and process IP protection. Conversely, many of my automotive-related stories understandably concentrate on specific hardware-software issues (see “IP’s Silent Presence in Automotive Market”).

The system-level view of both product and process outsourcing yielded many heuristics that apply to both the automotive and semiconductor IP markets. I won’t reveal all that this paper had to offer, but just enough to highlight these key best practices.

Key heuristics:

• Outsourcing models may help companies stay cost-competitive in the short run, but tend to hurt them in the long run by creating competitors who adapt or outright steal their intellectual property.
• Companies often expose much of their IP to partners and contract manufacturers when outsourcing skilled labor – as opposed to outsourcing low skilled production tasks.
• Outsourcing design and engineering exponentially increases the risk of intellectual-property theft.
• Regional “center of excellence” work only if companies improve the productivity of their engineers in high-cost countries and carefully “package” specific design and engineering work for low-cost countries.
• Companies must continually identify and manage their most strategic assets – both product- and process-specific IP (see “IP Adds Long Revenue Tail to Semiconductor Chips”).
• Most companies haven’t captured their un-organized institutional manufacturing knowledge (i.e., best practices).
• Don’t be casual about your less tangible assets. Remember, IP carelessness by US manufacturers led to Taiwan gaining expertise in motherboard manufacturing in the 1990s.
• Virtual systems have become useful tools to guard both product and process IP.
• No technology or management system is an ironclad guarantee against IP loss. But knowing what you have (product and process IP) will reduce the risk of loss.

This SAE article provided justification and a solution to reduce both product and process IP in a global design and manufacturing environment. You can read the entire paper by visiting: “PLM Promotes a Smart Outsourcing Model that Balances Cost with Intellectual Property Protection” by Bob Brincheck – Dassault Systèmes.

And yes, there is a fee for this paper that helps fund further work while reducing the risk of content theft. High-value intellectual property must be guarded in all of its various forms – from electronic design to useful articles about technology.