Dr. Morris Chang
speaker
200 appearances
1 recordings
1 series
first heard Jan 2025
last heard Jan 2025
Dr. Morris Chang’s voice in public audio — every appearance, attributed to the second.
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Appearances
In the first four or five weeks after I retook the CEO job, I probably spent almost half of the time on how to resolve the problem with the ambidea. As far as yields were concerned, we were doing our best. Because, you know, we had to do it anyway, you know. NVIDIA was just one of the customers.
Yeah. And it was a very important node. 40 nanometer was a very important node in the progression of Moore's law, you know. Yeah. Only after 40 can we, if we do the 40 well, can we do the 28? 28 was the next one. And I called the salespeople that were in direct, that had been in direct contact with NVIDIA.
And of course, I called everybody that was somehow involved, somewhat involved in the problem. So it was a matter of money. As far as the progress on the manufacturing lines, we were already doing what we could. As I just said, it wasn't just for NVIDIA. It's for TSMC. But NVIDIA, because they had borne the brunt of the the problem, the damage. It's a matter of money. I worked out a number.
I familiarized myself with all aspects of the problem, and then I worked out a number. And I also knew that NVIDIA's customers were after them. They had demands on NVIDIA, too. So I used all the intelligence I could get. And I think it turned out that it was good. So about a month after I retook the CEO job, I sent an email to Jensen. I said, I'm coming to Silicon Valley.
Next week on this date, I will be at your home at 6 o'clock. Let's have just salad and pizza, which was something that we had had many times in the past. Now, immediately he sent back an email. He said, when do we discuss business then?
He didn't ask that. So I anticipated that. So I said, 6.30 we'll start having pizza and salad. Eight o'clock shop, we'll go to your office at your home and we'll discuss business. So on the point of the date, the day I showed up, and we followed a schedule, exactly, you know, 6.30 I showed up. We had a very pleasant pizza and salad. Thing is that, you know, his wife,
Laurie would make the pizza, the salad. And the pizza was delivered from outside. Maybe they made their own pizza, too. I forgot. Would not surprise me. Yeah. Anyway, I had had it many times at his home. All right. So at every car shop, it was I who looked at the watch and said, gentlemen, why don't we go to your study, you know? And I gave him the offer.
And I also said, our offer is effective 48 hours. If you do not, there is not going to be, we're not going to argue. We're not going to bargain. If you don't accept the offer within 48 hours, you will have to go to an arbitrator. which was what he had suggested to the previous CEO anyway, that we go to the arbitrator. But the previous CEO did not even give him a number.
The previous CEO gave him zero.
No, I didn't want to. But I had to say that. And because, I mean, that number, the number we offered him was arrived at after, as I said, weeks of work on my part. And I thought it was fair to both sides.
Yeah, he did. Within two days.
I know, I liked it too. That's why I included the story in my autobiography.
Well, I had a lot of trouble at TI. My peak job at TI was the head of worldwide semiconductors. TI, of course, had many businesses, defense business, materials and controls business. and also their origin, which was geophysical and so on. But TI's semiconductor business was their biggest, and I was the head of that worldwide semiconductor business.
I wanted, at that time, when I was the head of worldwide semiconductors, our R&D budget was 4.8% of revenue, of our revenue. And I thought it was not enough. I just wanted to raise it to 5.5% of the revenue. But my request was denied every time I raised it. Now, coming back to TSMC. I wanted to set a number a percentage of revenue number.
So we don't have to argue every year how much R&D we should spend. So at about that time, about the time 2008, 2009, when I came back, I just, Almost like, at that time we were running, I think, 6% or 7% a year. But it was negotiated every year between the R&D director and the CEO. So I wanted to stop that. I wanted to make him at ease. He doesn't have to argue. He doesn't have to argue.
to request every year. So I almost just literally picked a number out ahead. We've been running 6% or 7% already. So I said, oh, let's pick 8%. 8% regardless of whether there's a recession or not. And it's just 8% of revenue. And that was the best news, if you ask our R&D director, who was back then, I think, in the second place of R&D.
He would tell you, I mean, he has told me many times in the last 10, 15 years that this was really the best thing that we did for R&D. So they were not concerned, the R&D director was not concerned at all about having his planned budget cut back or whatever. His planned resource, people, allocation, cutback, none of that. So he has been working 8% and so it has been like that.
And that is what propelled our R&D effort.
Yeah, I think it was kind of a mutual feeding thing, you know. As I settled the R&D budget at 8% of revenue, I mean, to the satisfaction of the R&D people, they began to have big ideas, you know. They began to be telling me, our 28 is going to be the term they use. And they have used it several times. But the first time I heard them using it is the 28. 28? It's going to be the sweet spot.
It's just like tennis racket, you know. You hit the ball with the sweet spot of your racket. Yeah. Do you play tennis?
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