Former TSMC Executive Shares Company’s Secret Efforts To Beat Intel

Ramish Zafar
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In an interview given to the Computer History Museum, a former executive of the Taiwan Semiconductor Manufacturing Company (TSMC) shared his experience of working with the company from its earlier years to right at the time that TSMC became one of the dominant chipmakers globally. Dr. Chiang Shang-Yi spent decades at the Taiwanese chipmaker and during this time he oversaw TSMC's research and development efforts and worked with the company's founder Dr. Morris Chang. During his career in the semiconductor industry, the former executive also saw some controversy when he left TSMC to join China's Semiconductor Manufacturing International Corporation (SMIC) which was his last chip company before retirement.

Former TSMC Executive Calls Joining SMIC One Of His Biggest Mistakes In Life

Dr. Chiang came into the spotlight in 2020, when its co-CEO Mong-Song Liang announced a surprise resignation after the former was appointed as vice chairman. The CEO sent a strongly worded letter to SMIC's management but remained in the company and SMIC's regulatory filings revealed that the company had also bought him a housing unit. Dr. Chiang left the company last year ad during his time at the company he repeatedly stressed the importance of advanced packaging and supply chain as crucial for SMIC's future.

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His interview covers his time at TSMC, and his thoughts on Intel Corporation, which at the time was leading the chipmaking race. Dr. Chiang remembers telling colleagues how Intel's technologies were generations ahead of TSMC's and shared that it was his wish that TSMC would outpace the American company's technology while he was at the company.

Sharing the differences between Intel and TSMC at the time he stated:

Intel, not TSMC, had a couple different cultures. Intel decided they want to do everything, “copy exact”. This most important principle in their R&D and their manufacturing. And what it means it's great for them. What it means, they develop this technology in R&D, use this equipment, use this recipe. They check everything very thoroughly. Everything great. Go to manufacturing, you never change it. You just follow that. Don't do any change. It's great. You have much lower risk. But the one problem is a year later, the new equipment has a better efficiency. TSMC will adapt that, Intel would not. So, then TSMC would begin to have a lower cost than Intel. So, TSMC tried to be very flexible, which it adapted.

And one reason is, obvious reason is Intel’s system. They can sell the wafer for $20,000 a wafer, because their CPU chip's very high price. And TSMC cannot sell the wafer for $20,000. We can only sell for $4,000. And we have to try to cut the cost. Next thing is Intel-- I really respect Intel. I think they are most willing to take very high risks. In every generation, they are willing to take risk to do something new. And in many key areas, for example, like high-K metal gate, strained engineering, FinFET, etc., it was always Intel, the first one to adapt that. And then TSMC would adapt in the next following generation.

So, every node, Intel's performance was better than TSMC. When I was at TSMC, I keep telling people, "We are behind Intel." We were behind Intel. "Don't look at it that you can release your 10-nanometer before Intel, then you're very happy. you are definitely wrong. Number one, TSMC's 10-nanometer definition is more like Intel's 14-nanometer dimension

Chiang Shang-Yi (left) and Liang Mong-Song are pictured above.

Intel's Performance-Driven Culture Ensured Its Edge Over TSMC Says Dr. Chiang

He also shared that during his time at TSMC, he started a project aiming to beat Intel's transistor leadership but ended up failing which is one of the biggest regrets of his career.

The project remained secretive inside TSMC, and Dr. Chiang shared that:

TSMC usually will wait until Intel adapted, till do it at the next following generation. Number three, not only the design rule, TSMC was also behind in transistor performance. TSMC always behind Intel’s transistor performance. And that's a good reason because Intel, their only product is CPU. And that is performance driven - they need that. TSMC doesn't need that. But usually if you try to judge who has a better technology, you go by performance. And you had to respect Intel had the better performance. When I was at TSMC, it was my last couple of years, I start an initiative. I say, "I want--" we called it Advanced Transistor Leadership, "We want to catch up and beat Intel in transistor performance." And that project failed. That project failed. I think nobody outside of TSMC’s small group knew about that. So, one of my biggest regrets in my entire career is we didn't catch up with Intel. But in my mind, TSMC technology was behind Intel. While you look at it from the surface, TSMC now is able to do 5-nanometer production. Intel's still at 10-nanometer. But I think Intel did stumble somehow. Right now, I think, Intel really is a little bit behind.

After leaving TSMC, the executive went on to join SMIC, when the company's CEO - who had also worked at TSMC - turned out to be a close colleague and a family friend. Dr. Chiang sought permission from Dr. Chang, which was granted and he joined SMIC. However, switching to the Chinese company was another regret, with him outlining that:

Later on, I joined the company. It was a mistake. Yeah. You did something right. You do something foolish in your life. It was one of the foolish things I’ve done.

A 300mm TSMC chip wafer on display at the 2020 World Semiconductor Conference in Nanjing, China. Image: Getty Images via Los Angeles Times

TSMC Executive Remembers Working Long Hours - Cites Depreciation As Reason For Company's Success

The differences in the working culture between the U.S. and Taiwan have also been a hot point of debate in the industry these days as TSMC is building its largest chip plant in Arizona. These differences have repeatedly been cited by Dr. Chang, who believes that the strict working culture in Taiwan is one of the key reasons behind TSMC's success.

Dr. Chiang also touched upon these differences, and he shared that fabs in Taiwan used to run full time because:

So, I firmly believe this is one of the really important reasons why TSMC succeeded. It's culture. If equipment went down, because equipment depreciation cost was so high, you really want to run your equipment 24 hours a day. In United States, if equipment went down, wait until next morning. The people come in at eight o'clock and probably go to fix it, nine o'clock. Yeah. But if at two o'clock in the morning, we just called the equipment engineer, "You come right away," he won't complain. And his wife won't complain. And that's the way it is.

He also recalled working long hours and weekends at TSMC in Taiwan, while his family was in the U.S as executives who had held his job previously were consistently changed due to a lack of results. Dr. Chiang recalled that:

I joined the company I think on June-- July 6th, and I worked all day, all night, every weekend, Saturday and Sunday. I live in the dormitory in the Science Park about a couple hundred meters from the office. I seldom left the Science Park except go to get a haircut, buy some groceries. I worked days, nights, weekends, holidays. The first time I went hiking with my friends was October 25th. It was a national holiday at that time, so for 3-1/2 months I worked every day and every night. Because at that time, they were developing .25 micron technology. And during the .25 micron technology development, they changed four R&D VP’s. I was number four. And they changed three program managers and I was the last one to clean up. We had identified five major technical problems which needed to be resolved. And honestly, I did take some advantage of the knowledge I already learned to help solve some technical problems.

TSMC's founder Dr. Morris Chang (Zhang Zhongmou) during a keynote in April last year. Image: Lin Xunyi/United Daily News

He also revealed what it was like working with Dr. Chang, revealing that Dr. Chang would only give subordinates 30 minutes to present their ideas. During this time, he would focus on facts he did not know, and if he was unimpressed during the first five minutes, then he would spend the next 25 criticizing the presenter.

Dr. Chiang figured out a workaround, which he explained as:

He totally has no patience for this sort of thing. So, you have to go reverse direction. You tell him, "This is the result." Then he says, "Oh." Then he thinks, "My 30 minutes already paid off." Then he will be very patient to listen to you on the details.

Once Dr. Chang's attention was caught, he would be "even very nice to you" said Dr. Chiang, and also be"very, very patient. Because his 30 minutes already paid off. He already got what he wanted."

Since Dr. Chiang's departure, TSMC has established itself as one of the world's largest chipmakers and it is competing neck to neck with Intel. The company is currently racing to roll out its 3-nanometer semiconductor manufacturing technology to mass production, as it competes with both Intel and Samsung for the high-end chipmaking technology crown.

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