Abstract
Integrated Device Manufacturers (IDM) can focus on their core technologies and raise their competitiveness with outsourcing non-core technology operations, taking advantage of the specialized capabilities in the IC industry supply chain in Taiwan. The key is for the IDM to integrate the resources of subcontractors into its manufacture operations to enhance its competitive ability. For example, IDM needs the assistance of the contract assembly house to cover their package assembly process.This study explores the management practices of the assembly capacity outsourcing with a selected IDM case in Taiwan. The key questions are: how an IDM acts to get enough capacity and timely response from the assembly house, and how IDM and the assembly house reach the agreements on capacity and material preparation.This study works out a suggested process flow of the assembly outsourcing management and the related execution actions. The process flow is derived from the case study and is shown to solve the production control problems in the selected IDM and its assembly house. After the IDM adopted the process flow to links the production data from wafer manufacture to the finial test as an integrated process, these control problems are solved and the performance improved. This study has also based on the suggested process flow built a model to improve the trust in the relationship between the IDM and the assembly house.