Increased staff participation helps global chipmaker reap manufacturing dividends

Global chipmaker AMD Technologies is perhaps one of the best examples of a foreign company that has staved off economic woes in China and tasted manufacturing success.

The US-based company assembles, tests, marks and packages most of its central processor units, graphic processor units and accelerate processor units from its factory in Suzhou Industrial Park.

Like most of the other manufacturers across China, AMD's Suzhou plant also had to encounter challenges such as the increasing mobility of the workforce and higher labor costs. Wage bills at AMD's Suzhou plant have risen by over 10 percent every year in the last few years. However, the company has not allowed it to be a detriment, and instead focused on boosting production efficiency and better workforce management to power ahead.

The company introduced several manufacturing processes like "lean manufacturing" and "process optimization" at the Suzhou facility, with the main aim being to make more products with less resources.

Tan Chow Khong, managing director of the plant and vice-president of the company's global manufacturing operations, says procedures have been simplified and more decision-making powers have been given to different levels of management. For example, administrative approval that once required multiple signatures has been streamlined.

Tan says the factory staff's changing demographics have also been taken into account. "Ninety percent of workers on the production line were born in the 1980s and 1990s, and, unlike their parents, they have big dreams and are notcontent just to make a living."

The real challenge for companies like AMD is to match the employee expectations with the company's long-term goals. "We focus on the integrity and pragmatism of the employees and also try to match the life and career goals of the employees with our long-term goals."

Tan says most of the new employees often have higher self-expectation and it is important for companies to activate it to ensure continued success.

"Many companies pay more attention to value creation and ignore the personal success of the employees. This needs to change," Tan says.

To ensure self-development, AMD conducts round-table conferences with its employees every week. Company officials discuss the current situation, short and long-term goals at the meetings to ensure that they are in tune with the overall vision. Suggestions from employees are also used to improve working conditions.

According to Tan, AMD also encourages employees to develop their skills.

Employees are provided targeted training should they desire it, he says. "Many workers who used to execute one practice and work on one machine now can do many tasks and work on multiple machines. This boosts productivity and reduces boredom at work," he says.

At the same time, workers are also allowed to offer their own analysis on the work-flow and also make some decisions, which is different from the earlier techniques of workers doing only what they were told to do so.

Many of these techniques have helped stabilize the AMD workforce in Suzhou and improve productivity. According to AMD, the turnover rate at its Suzhou plant is far below the Suzhou average of 30 percent a year.

In 2010, the company expanded the facility of the Suzhou plant and doubled its capacity. AMD's Singapore plant was also shuttered and merged with the Suzhou plant. This, Tan says, demonstrates the increasing importance of the Suzhou plant to AMD.

zhengyangpeng@chinadaily.com.cn

(China Daily 03/01/2013 page5)