Silicon Valley Nation
Silicon Valley Nation: Maxim confronts new challenges
Brian Fuller
11/27/2012 2:45 PM EST
CEO Tunc Doluca and his team have spent five years shaking up what had become a classic three-yards-and-a-cloud-of-dust old-line analog company, Maxim Integrated Products. They changed up their manufacturing strategy and brought in a manufacturing expert from Intel; replaced the CFO; refocused the business units; tidied up their distribution and supply-chain strategy; and brought in new marketing blood. On top of that, the company got so serious about the word "integrated" that they rebranded the company as Maxim Integrated.
The company has rebranded and repositioned and refocused, and the stock market's taken notice: in the last two years, Maxim shares have begun to outperform some key competitors.
But, really, the hard part is beginning now, because an entire customer base doesn't awaken one morning and suddenly realize how different and fantastic their vendor is, especially in a market when there are a lot of choices; especially in a market where analog competitors are scratching the integration itch; especially in a market where digital companies are adding more analog into their portfolios.
"Our challenge is convincing the customers that we can take care of all of their analog needs," Doluca says, sitting in front of an impressive painting of Istanbul, in his native Turkey.
"I think in most cases, our customers are still thinking the right way to do these (designs) is we'll get highest-performance analog blocks and put a pc-board design together and build a system. But they don't realize we have the blocks and we can do it for them."Integration push
To date, the strategy has been to sweep up analog components around other existing analog components the company sells. But the company also is looking at a "Big D (digital), Little a (analog)" strategy. Maxim has a bunch of a "Big A, little d" products, but the key is to get a reputation as a company that delivers a truly integrated solution with competitive digital technology.
Such a strategy "helps us because not only are we capturing analog revenue, we're capturing digital revenue inside some of these (systems)," Doluca said.
Some of the company's mobility products, for example, which are primarily power supply solutions have embedded MCUs. "They're becoming so complex you need those micros to do sequencing or looking at the health of the power supply. But we still call those Big A, little d parts," he said.
Next: "Big D, little a"
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truekop
11/27/2012 8:23 PM EST
"Maxim shares have begun to outperform some key competitors." I dont think that is the case.
Atleast a cursory look at yahoo finance comparing Maxim, LTC and ADI for the past year it shows equal or slightly weaker performance of the Maxim stock...thus depending on when you start the comparison the results will change :)
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danlutes
11/28/2012 6:00 PM EST
"Before 2007, Maxim had done almost no acquisitions, save for acquiring a Tektronix wafer fab. It preferred to build everything in house. "
What about Dallas Semiconductor in 2001 for $2.5 Billion in stock?
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Brian Fuller2
11/29/2012 11:41 AM EST
@truekop and @danlutes... points well taken. I should have altered the phrasing a bit, especially on point #2 (a focus on ramping of acquisitions in the past five years)...
Thanks for commenting!
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Bob109
11/29/2012 12:11 PM EST
The problem I have always had with Maxim is getting any production parts at all. Parts were always available for prototyping but when it came time for production the parts were never available. Designing a Maxim part into a design was the equivalent to cutting you own throat.
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Andy P
12/18/2012 2:38 PM EST
"Designing a Maxim part into a design was the equivalent to cutting you own throat."
Exactly. Maxim is blackballed by any company that's not ordering 100k parts a month.
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Frank DeFelice
12/4/2012 7:24 PM EST
Never base your design on parts not in production. You're asking for trouble. If you need prototype parts to tweak your design, you're asking for trouble. Never promise more than you can deliver.
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Andy P
12/18/2012 2:40 PM EST
"Never base your design on parts not in production. You're asking for trouble. If you need prototype parts to tweak your design, you're asking for trouble. Never promise more than you can deliver."
Maxim's problem has always been that they have a lot of devices listed as "in production," yet you can't actually order them in anything but huge quantities.
This is why we always get purchasing to confirm availability of anything before it gets designed in, but one can also use the old rule of thumb: "don't design with it if you can't buy it from DigiKey or Mouser."
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