Entering the stepper business — a second pillar in semiconductors (1980)

The shadow inside the winning formula

The heart of this decision was that it was not a retreat forced by crisis but a deliberate carrying of the company’s deepest technology out beyond a mature core business. The optical glass and precise positioning built for cameras mapped directly onto the accuracy that semiconductor miniaturisation demanded. When the sidelined build-to-order group offered up the technology it had been nursing to the needs of the age, this proud old firm gained a second face — “the Nikon of semiconductor equipment.” A company long chided for being slow to diversify was, in a single turn, counted among diversification’s success stories.

And yet a shadow already lay across the very strength that made the entry possible. Answering Japan’s chipmakers one machine at a time, and taking share through direct sales and close attachment to the user, was the finest formula there was — so long as the customers were gathered in Japan. In 1984, when President Fukuoka showed his composure — “we have ten years of accumulated stepper technology; we will not be caught so easily” — the distant cause of the later reversal was already inside the shape of the business. How to raise a second pillar is bound up, inseparably, with the question of what that pillar is leaning on to stand.