Adverse User Innovation

Abstract

IntroductionVon Hippel (1988) coined the term innovation by arguing that semiconductor device makers (equipment users) played a critical role as innovators in the development of semiconductor process equipments rather than process equipment manufacturers.However, in the same period as the research by von Hippel (1988), the Japanese semiconductor process equipment manufacturer, ULVAC, conducted not only research and development (RD we define this phenomenon as adverse user innovation.ULVAC is a process equipment manufacturer founded as a venture in 1952. It has grown to be a company with sales of about 200 billion yen in 2016. Their highest source of revenue is the deposition process equipment using vacuum technology. This specific equipment had gained approximately 70% of the global market share in the field of HDD (1990) and about 80% of the global market share in the field of LCD (2008).The company autonomously conducted fundamental research, developed new process equipment for the market using the research result, and provided the equipments to users. In concrete terms, the company conducted fundamental research on cobalt-nickel-chrome (CoNiCr) material composition and developed new HDD manufacturing equipment based on the results. Such fundamental research is supposed to be conducted by device makers (equipment users); conversely, ULVAC created adverse user innovation, and successfully developed new equipment, thus achieving corporate growth.In this study, we present a case of ULVAC as the phenomenon opposite to the assertion by von Hippel (1988); however, there is a possibility that such a phenomenon is not rare. In the following, we explain the details of adverse user innovations made by ULVAC.Material Research of ULVACFounded in 1952 as an RD in 1972, the company established the Institute for Super Materials (ISM) as an independent corporate research laboratory that conducts fundamental research on materials and processes.Chikara Hayashi, the third president of ULVAC, established this research laboratory. Despite recession, he established the research laboratory against opposition from the board members. Why did a process equipment manufacturer establish a research laboratory of materials? President Hayashi explained:For customers to use our vacuum equipment, the process problem of the product needs to be solved: The purpose of establishing ISM is to place our company on a common ground with our users. We would provide knowledge and skills based on vacuum technology, following which users would request applications and suggest technologies that are unfamiliar to us. This was key to the development of the industry; therefore, it was absolutely necessary to establish ISM (ULVAC, 2002).From the 1970s onward, process equipment manufacturers began to face an ever-increasing need to understand process technologies in order to effectively develop new process equipment (Semiconductor Equipment Association of Japan, 1991). However, process equipment manufacturers are often only permitted to stay in the factory from delivery of the equipment until stable performance of the machine is achieved (Akabane, 2014; Shintaku, 2008). Owing to these limitations, ULVAC, a process equipment manufacturer, established ISM and undertook a fundamental research to deeply understand the process of equipment users. The research objects of ISM were various materials such as superconductive, super high-temperature, super low-temperature, and super functional materials. They paid attention to what the users (device makers) want now and what type of materials and processes are required for the devices. …