Effective January 1, 2012, the California Transparency in Supply Chains Act requires many companies doing business in California to provide information regarding their activities to ensure their supply chain is free from slavery and human trafficking.  This law affects all companies that do business in California and whose worldwide gross receipts exceed $100 million.  That includes a lot of semiconductor and high tech companies in our area, so I was curious to see how companies are complying.

I tried a quick search on "CA Transparency in Supply Chains Act semiconductor" and found the following on the first page, in order of appearance: Vishay, ON Semiconductor, Texas Instruments, Applied Materials, Cypress Semiconductor, Micron and Global Foundries.  I'd expected to find Apple there.  After all, Gartner just announced in a January 24 press release that Apple was the top semiconductor customer of 2011, moving up from third place in 2010.  And, they've certainly been in the news lately for the human rights issues that their supply chain audit uncovered.  

Checking back on the requirements of the law, I found that no specific language is required to be compliant, but it does require that the disclosure appear on the company's home page, and that it is conspicuous and easily understood.   Looking through the homepages of both the top 10 semiconductor customers of 2011 that Gartner identified and the hits on my initial search, Apple stands out as one of the best examples of compliance, while others don't appear to be in compliance at all.  Interesting.

 Tensoft customer Amalfi Semiconductor pioneered high-performance radio frequency (RF) semiconductors for the cellular handset market based on standard, low-cost complementary metal-oxide semiconductor (CMOS) technology. Experiencing rapid growth from its success, the company needed more financial and manufacturing management capabilities than Intuit QuickBooks and a "point-in-time" WIP tracking solution could provide. Working with Tensoft, the company implemented Tensoft Fabless Semiconductor Management (FSM) and Microsoft Dynamics. The company has already saved US $75,000 in duplicate vendor invoicing and realized significant efficiencies. With the business management software in place, Amalfi has a solution that takes advantage of purchasing controls to support regulatory compliance. In addition, executives, operations employees, and finance managers now have the insight and control they need to help the company reach its growth goals.

For the complete case study, go to http://bit.ly/yiWV3g.

 We're very pleased to announce that we have passed the National Association of State Boards of Accountancy (NASBA)'s certification process!  We can now offer an officially sanctioned CPE Sponsors ID number to our webcast and live event attendees - a nice benefit to them since most state boards now want at least some of your CPE credits to be from NASBA approved sponsors. 

I won't lie to you though - it's not an easy process, despite the very helpful and nice folks who're there to guide you through all of the steps.  But, then, not much that's worthwhile is easy.  In the end, I think our webcasts will be better for having gone through this, which is a clear benefit to Tensoft too.  We'll be very interested to see if attendees notice a difference, as evidenced in the survey results afterwards. 

If you haven't joined us for a webcast yet, or if you're one of our Frequent Attendee, I hope to see you at one soon.  And, don't forget to answer all of the polling questions, so that we can send you a CPE certificate! 

 Tensoft CEO Bob Scarborough will be a panelist at the GSA's inaugural Semiconductor Ecosystem Summit on October 6, 2011.  The session is entitled "Best Supply Chain Practices for a Successful Partnership" and will start at 10:45 am.  The discussion should be of interest to fabless semiconductor companies, as well as their suppliers.

This event has replaced the GSA Emerging Opportunities Expo (formerly the FSA Suppliers Expo), so please be sure to join us at the Santa Clara Convention Center for this new event.  Register here to reserve your spot now.   

If you would like to meet with Tensoft - either during the Summit or outside of it - please contact us to schedule a meeting. 

Since most of Tensoft’s customers are technology companies - and because we’re a technology company ourselves - we follow news about the tech industry with a great deal of interest.   The past year has seen a significant bump in tech IPOs, accompanied by a great deal of speculation about whether or not this presages another dot-com bubble.   Rampant overvaluation heads the list of the symptoms cited most often, although there are plenty of other  voices arguing that the recent tech IPOs are companies with solid businesses, not Webvan or Pets.com. 

Thanks to this infographic by KISSmetrics and FeeFighters, it’s a little easier to see what’s been happening and how it looks compared to the dot-com bubble in the late 90’s.  And, thanks, The Atlantic’s Associate Editor Nicholas Jackson, you don’t even need to sort through the data – he’s provided a pretty concise analysis, which I’ll quote herein full:

• Although it may seem that recently (2009-2011) startups haven't had problems raising capital, the level of venture investment currently pales in comparison to levels during the .com bubble. A lot of people are talking about an early stage bubble, but even in early stage deals, we're nowhere near the .com bubble.
• Even with the seemingly high number of recent tech IPOs, historical data suggests that the number of current tech IPOs is drastically smaller than during the .com bubble.
• When most people think of the .com bubble of the '90s, they think of the giant run-up in tech stocks. The pace at which the Nasdaq 100 index shot up (10x in four years) was impressive and every individual investor wanted a piece of the action. Fortunately, we don't seem to be approaching the craziness of that time.
• Today, tech companies have access to a relatively large pool of potential customers -- something that the tech companies of the .com bubble didn't have. In 2010, there were 10 times the number of Internet users there were in 2000. The current number of active Facebook users is equal to the number of total Internet users there were in 2002.  (from “Infographic: Are We in the Middle of Another Tech Bubble?,” Nicholas Jackson, The Atlantic, 7/19/11).

What do you think?

  After two days at keynotes, meetings and more meetings at Microsoft’s Worldwide Partner Conference (WPC), we’re feeling better than ever about Tensoft’s focus these days.  Between our long-time vertical industry focus, our commitment to the cloud, and our Gold ERP Competency, almost everything that we’re hearing here supports and validates our goals.

During Monday’s keynote session, Steve Ballmer cited a 20% compound annual growth rate over the past 10 years for the Dynamics product line.  In the National Strategic Partner FY12 Kickoff meeting that we attended today, nationally managed partners were credited with driving a substantial portion of this growth. 

In another meeting, a Microsoft executive noted that 25% of this year’s 15,000 WPC attendees are Dynamics partners - remarkably high considering all of Microsoft’s other product lines that partners represent. 

As expected, there has been a lot of focus on the cloud this year.  But, we’ve been pleasantly surprised by the focus on Dynamics, and glad that we made the effort to be at both WPC and Convergence in 2011!  

 While Tensoft has been a Microsoft Gold Certified Partner since 2004, it’s never been as difficult to meet the requirements as it was this year.  That’s because of deliberate changes that Microsoft has made to their Partner Network Program.

IDC analyst Darren Bibby does a great job explaining what’s happened in his blog post, “Microsoft Partner Network - Can We Bring Back Meaning To ‘Gold’ Please?”   In brief, Bibby says that, in recent years, about 50% of all Microsoft Partners were able to attain Gold Partner status.  His point, of course is that:  “50% is not such an elite level.”  By contrast, Microsoft’s Partner Network website states that, currently, “only 1 percent of Microsoft partners worldwide that have attained this outstanding degree of proficiency.”  Now that’s a little more elite!

The other programmatic change that Bibby mentions is that the new Gold and Silver (which is now the top 5%) levels are associated with specific “competencies,” each focusing on very specific knowledge and expertise.  Combined with the more rigorous requirements for Gold, this ensures that a Microsoft Partner that really excels at what they do within these competencies is easily identifiable to customers, partners, and Microsoft employees.  

Tensoft is especially proud to have attained the Gold level for the ERP Competency this year, demonstrating our excellence in the skills, expertise, and resources needed to successfully deploy financial and supply chain management solutions for our customers.  One percent out of approximately 640,000 partners is not bad – we’re honored to make it, and we congratulate all of the other Microsoft Network Partner members who made it as well. 

 One of the highlights of this year's MOMENTUM 2011 was guest presenter Charlotte Diener's session entitled "Planning Rhythm."  Diener has created an excellent Slideshare version of this that's available now to anyone who's interested.  You can link to it here, or search for "The Planning Rhythm: Managing Risk Through Marching to the Same Drum" on Slideshare. 

This brief description of Diener's presentation from the conference agenda applies to the revised slides on Slideshare as well: "Just as world-class manufacturing operates to the drum beat of critical equipment, the excellent supply chain operates to a regular rhythm of processes. The use of a process rhythm is critical to the performance of supply chain planning, irrespective of software. This presentation will explore the critical processes necessary in semiconductor planning, their frequency and duration."

Ms. Diener is an independent consultant with extensive supply chain, turn-around, M&A integration and international experience. Ms. Diener has completed several global multi-million dollar M&A integration projects and the re-engineering of several corporate processes, including a complete re-work of both the supply chains and new product development processes at ON Semiconductor.  Her contact information is included on the slides. 

 In case you missed this recent announcement, Tensoft Revenue Cycle Management (RCM) recently passed Microsoft's highest standard for partner-developed software and is now "Certified for Microsoft Dynamics" (CfMD).  This certification consists of a rigorous testing process performed by VeriTest, to demonstrate product development quality and compatibility, as well as at least 10 confirmed references.  (Many thanks to our customers who helped with this requirement - we were done in well under the average time for completion because of your help!)

Those were basically the same requirements for the CfMD that we had the last time that we went through this process, when we certified Tensoft Multi-National Consolidation.  This time there was one key difference though - the addition of a requirement to have a Source Code Escrow Account. 

This new requirement seems to get short shrift in discussions/articles about CfMD, but we see it as one of the key benefit to customers of CfMD products.  Without it, the CfMD benefits have the potential of being short-lived, providing cold comfort to unlucky customers.

A source code escrow account isn't something new for Tensoft - we've had an Iron Mountain account for years.  Having weathered two significant economic downturns since we started business in 1996, we've counted our blessings as we watched much larger companies fail.  While we feel pretty good about surviving, it would be foolishly arrogant to believe that we're now somehow "immune." 

We buy insurance to protect against adversity, and our Iron Mountain account is insurance that we buy for our customers.  We see it as a great investment in customer service!

 This year at Tensoft FSM's annual user conference, we had the privilege of hearing from several really terrific guest presenters and panelists.  Semiconductor supply chain consultant Charlotte Diener kicked things off on the first day with her presentation on "Planning Rhythm."  Here's a brief description of what she covered: "Just as world-class manufacturing operates to the drum beat of critical equipment, the excellent supply chain operates to a regular rhythm of processes.  The use of a process rhythm is critical to the performance of supply chain planning, irrespective of software."  This presentation explored the critical processes necessary in semiconductor planning, their frequency and duration. A great session and a very warm response from MOMENTUM 2011 attendees! 

On Day 2, Ron Jones of the N-Able Group provided some fascinating - and very sobering - insight into "The Tragedy in Japan and the Semiconductor Supply Chain."  He covered how the immediate and subsequent events of the recent earthquake and tsunami in Japan are impacting products and markets around the world, and discussed both possible recovery scenarios and implications to supply chain management in the future.  Ron has been doing a great job covering this topic in his newsletter too, so be sure to sign up for that on www.n-ablegroup.com if you're interested.

Following that, Ron moderated a panel discussion on supplier integration.  The conference agenda described this session as follows: "Supply chain execution is about the fabless company managing the process.  It is also about partnering with your suppliers, exchanging data across your production flow, and communicating the right information to all parties on a timely basis.  Our supplier panel brings together leading industry suppliers (UMC, AMKOR) with fabless companies and an electronics supply chain experts to discuss relevant and current topics important to the semiconductor Industry.  Panelist presentations and a moderated Q&A session provide interesting and helpful insights for all participants."  The guest panelists were Amkor's Trisha Giacopazzi, UMC's K.T.Goh, Dean Strausl from V-Case (and the former Executive Director of the Electronics Supply Chain Association), and the VP of Operations at iWatt, Alex Sinar.  Apologies to our attendees that we didn't plan more time for this distinguished group - this session could easily have stretched to half a day or more!

One small world observation during the conference this year: unbeknownst to us, 2 of the guest presenters had worked together some years ago, and had a chance to catch up over lunch.  Great to see such a strong degree of collegiality among both guest presenters and conference attendees!