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June 5 - June 15, 2022
Every night before he fell asleep, Noyce would mentally rehearse each of his dives in slow motion until he could see himself executing them perfectly. He called this habit “envisioning myself at the next level,” and he carried it with him throughout his life. In his mind’s eye, he could always see himself achieving something more.44
Thus early research at Fairchild Semiconductor was almost all process oriented, with building a saleable product the fundamental goal of the research lab. Noyce and several of the other researchers directly refer to the IBM specifications in their scientific lab books, giving as much weight to performance targets as they did to the science they needed to reach those targets. Noyce, who believed that “the only thing that’s technologically exciting is something that has a need for it,” was the ideal man to oversee this work in the lab.11
The integrated circuit made electronic devices smaller, faster, and cheaper than ever before.
Baldwin had probably not planned to leave in March, but Richard Hodgson, who had gotten word of Baldwin’s talks with Rheem, flew out to Mountain View and summarily fired him with the immortal words, “I wish you lots of luck—all of it bad.”
Noyce well understood that the success of Fairchild Semiconductor would depend in no small measure on the precision and rigor of its manufacturing facility. He thought, however, that the best way to achieve the necessary level of discipline was not to clamp down on the lowest-paid workers but to open up as much as possible.
Noyce was trying to convince Autonetics to accept planar transistors instead of the mesa transistors originally specified, since he expected planar yields would soon match mesa yields and thus saw no reason to continue making mesa transistors given the greater reliability of the planar devices.72
Noyce once said that “the job of the manager is an enabling, not a directive job … coaching, and not direction, is the first quality of leadership now. Get the barriers out of the way to let people do the things they do well.”
Andy Grove, who joined in 1963, once described Fairchild as “a strange little upstart,” a phrase that captures the essence of the organization. Noyce’s unorthodox management style was just one innovation launched at Fairchild. In the lab, informal company policy allowed “PhDs to play with their ‘toys’ [ideas] for about a year” before expecting results. If an idea appealed to a researcher—for whatever reason—he was free to pursue it. This rather loose definition of relevance led Fairchild researchers to develop roughly one-sixth of all major integrated circuit innovations during the
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Consequently, while other firms in the early 1960s used government contracting as the primary source of R&D funding, less than 10 percent of business at Fairchild was contracted directly by the government in 1963. “And we like it that way,” Noyce hastened to tell a reporter.8
the early 1960s, Fairchild began to internationalize its business.
Noyce’s greatest strength as a manager was that he gave people confidence in themselves.
Fairchild worked hard in the early years following the integrated circuit’s introduction to overcome customers’ objections to the device. To give customers some sense of control, the company (as well as others, such as Motorola) permitted buyers essentially to custom design the circuits using methods very similar to what had been standard operating procedure for discrete components. To counter concern about reliability, Fairchild stepped up its in-house testing methods and advertised the strenuous conditions under which the integrated circuits had already been proven to perform. The company
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to a 90 percent reduction), and power (up to 75 percent reduction). Fairchild even designed its integrated circuit packages to make the devices look and feel like discrete components.28
Accordingly, in the spring of 1964, Noyce made a little-discussed but absolutely critical decision. Fairchild would sell its low-end flip-flop integrated circuits for less than it would cost a customer to buy the individual components and connect them himself, and less than it was costing
Fairchild to build the device. Gordon Moore calls this move “Bob’s unheralded contribution to the semiconductor industry,” and it shocked most competitors into a frigid “no comment” until they made the decision to match prices.
Gordon Moore has said that Noyce’s decision to lower prices to stimulate demand so that the production volumes could grow and the cost of production be decreased accordingly was as important an “invention” for the industry as the integrated circuit itself. “It established a new technology for the semiconductor industry [that holds true] to today,” he explained. “Whenever there’s a problem, you lower the price. That was as revolutionary a concept to people within Fairchild as it was to the customers.”32
Noyce’s manner of offering general directives rather than following up on specific process details was ideal for supervising highly creative technical work—indeed, it was the source of his success as the head of R&D—but this management style did not translate well to large, multifaceted organizations.
Noyce had asked himself the same question. He had briefly wondered if he and Moore were too old—Moore at 39, Noyce at 40—to start a company.
Even Warren Buffett, who joined the Grinnell board shortly before the decision to invest in Intel was made, was willing to abandon one of his fundamental rules of investing—only put money into things you understand—in this particular instance. As Buffett put it, “We were betting on the jockey, not the horse.”39
Where Fairchild had lumbered in the last few years, Noyce and Moore wanted Intel to race. “Use money to buy time because money is cheaper than time,” Noyce told Gene Flath, who had, of course, put this philosophy
into practice when he bought equipment off the trade show floor. In the white-hot semiconductor industry of the late 1960s, being
first to market would put Intel in the position of what Gordon Moore called “a rifleman who shoots at a blank wall, finds the bullet hole, and then paints the target around it.” The first company in the market always hits the bull’s eye becau...
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arrivals find the target already in place, the market defined...
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William Shockley’s methods of using simplifying assumptions to speed up his company’s research, Noyce had come to believe that scientists could approach their work in two very different ways. Researchers could adopt the “pretty” approach, in which they devote a great deal of time and effort to developing a technique or machine that will allow them to test their ideas with exact measurements that yield final definitive answers. Or a researcher could try the “quick and dirty” way, moving forward with an idea as soon as a rather rudimentary test indicates it will probably work. Noyce believed
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The microprocessor, in other words, brought software to the semiconductor industry. In doing so, it placed new demands on customers, most of whom were experienced hardware designers unfamiliar with using computer programs to solve their systems problems.84
“Our non-union status is the direct result of your choice as Intel employees to have open and free communication and to solve our problems together, without outside intervention,” Moore reminded his employees. “We want to keep it that way.”14
Noyce liked to say, “You can only lose 100 percent, but the multiples on the up side are fantastic.” In some sense, Hwoschinsky’s most important job was to
In one of the more shocking reversals, Gordon Moore and Andy Grove recommended to the Intel board of directors that the company leave the DRAM memory business altogether in 1985. A DRAM memory—the 1103—had been Intel’s first best-selling product. DRAMs had brought the firm from a two-man startup to the Fortune 500. But now the product line was acting as a net drain on profits from other areas of Intel’s business, particularly microprocessors, because Intel had to price the memories so cheaply. Andy Grove recalls “going to see Gordon [Moore] and asking him what a new management would do if we
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The importance of the semiconductor industry to the United States economy was Noyce’s favorite topic in the early 1980s.
