Chapter 489 The Entire Industry Chain (Bug Fixing): This is a magical land

Wang Xiao explained, “Everyone says that the advantages of investing in mainland China are labor and land. These two factors combined help control costs. But in reality, the advantages of mainland China go far beyond that. There are more people, more factories, and more supply channels. If equipment and raw materials can be replaced with domestic products, then using domestic products will be even more effective in controlling costs. This is because, firstly, domestic products are inherently cheaper; secondly, transportation is less difficult and costly; and thirdly, once orders stabilize, the production scale of these factories increases, which can further reduce costs.”

She smiled and said, "I heard that when World University was doing packaging and testing, they originally planned to use Advantest's packaging and testing solution from Japan. But you don't blindly believe in big brands. You worked with Powertech Technology in Taiwan to debug and improve the solution, and finally used your self-developed solution. This not only saved a lot of costs, but also allowed Powertech to reach a new level. I hope you can discover more about Powertech."

Wang Xiao dared to discuss supply chain issues directly in front of Mayor Huang, not because she was arrogant and thought she was no longer in a position to care about the feelings of the leaders of Xiaozhou City; but because she had existing suppliers waiting for Dr. Zhang to verify whether the plaster could be applied to the wall.

Which supplier? China's semiconductor equipment industry is currently very weak, and most equipment is imported. Which company has already emerged as a leader?

Ovechkin.

Does this name sound familiar? Like a Russian name?

He doesn't just look like him, he *is* him.

When Wang Xiao led Zhang Bo to see the factory, he introduced him, saying, "This is my friend. He started a factory in Jiangbei in 1993, producing insulating gloves. He used the technology that the Soviet Union used to supply gloves to aircraft, and he recruited many technical personnel. Now companies like Haier and Skyworth are using his insulating gloves."

She was a little embarrassed, "The semiconductor industry in mainland China is actually still in its infancy, and specialized equipment is one of the weakest links in the industrial chain. So even basic supporting consumables like insulating gloves are not readily available everywhere."

Zhang Rujing had already made many trips to the mainland to investigate the market, so he naturally understood the market situation.

He nodded with a smile: "Insulating gloves are indeed very important. They are used in large quantities for equipment maintenance and debugging in the upstream process, daily operation and emergency repair of factory facilities, and testing and packaging in the downstream process. If the quality meets the standards and we don't need to import them, we can save a lot of costs."

The reason he agreed to become a consultant was that the first thing he saw in Wang Xiao was that this boss was wealthy and willing to spend money on the wafer fab, and also ambitious and wanted to expand and strengthen the business.

A boss like this pays money readily, which saves a lot of trouble.

However, they also share a common flaw: they are arrogant and believe that as long as they are willing to spend money, any problem can be solved. They all love to focus on high-tech and cutting-edge technologies.

However, the nature of the semiconductor industry dictates that results cannot be easily achieved by simply throwing money at it. Especially now that the industry has developed to the point where major giants have almost formed a monopoly.

Newcomers can only accumulate advantages little by little and wait for a turning point to make a breakthrough.

So it's a good thing that the boss is willing to start small.

The car drove into the industrial park in Xiaozhou, where Ovechkin's new factory is located.

It has to be said that after just three days, the changes are remarkable. The small factory in the town back then has been completely transformed. At first glance, it looks high-end, classy, ​​and a truly modern enterprise.

Ovechkin was also quite different from before; he was at least 1.5 times the size Wang Xiao remembered. Standing there, he really looked like an iron tower. And he loved sunbathing, having gotten himself quite tanned.

To be honest, he really does resemble the Black Bear Spirit from "Journey to the West".

Seeing that Wang Xiao hesitated for a moment before daring to acknowledge him, Ovechkin immediately complained, "God, she has ulterior motives; she deliberately fattened me up."

Who is she? Of course, she's Ovechkin's wife.

He stayed in Jiangbei for a long time and became Jiangbei's son-in-law.

According to Ovechkin, he was captivated by his wife's culinary skills; her cooking was simply too delicious.

However, Wang Xiao had privately gossiped and found out that the two had actually gotten pregnant before the marriage was finalized. Ovechkin's wife had won the "war" by getting pregnant.

Why bring up war? Because Ovechkin had a girlfriend at the time. He didn't hide it; all three knew about each other.

Finally, when Ovechkin was holding his wedding on the north bank of the river, another girl brought a group of people who wanted to cause a scene at the wedding, but they were persuaded to stop and were taken away.

This is the magical 90s, where anything unbelievable could happen.

Logically speaking, given the disastrous start to Ovechkin's marriage, things should have been chaotic.

What's even more amazing is that the couple actually lived a pretty peaceful life.

Because Ovechkin is Russian, the one-child policy doesn't apply to him. He and his wife already have a son and a daughter, both of whom are incredibly beautiful and look like little angels.

Xiang Dong even asked them to be child models.

However, given his rather chaotic romantic history, it's understandable that Ovechkin's wife is anxious and wants to fatten him up early.

Because Zhang Rujing couldn't understand Russian, Wang Xiao spoke to Ovechkin without restraint: "Wow! Your wife is quite magnanimous. For a big boss like you, just feeding you until you're fat isn't enough; we have to control your purse strings too."

Money and power always have an inherent halo of beauty, making people infinitely charming.

Ovechkin arrogantly raised his head, the fat on his chin trembling in the December wind, making Wang Xiao want to gouge his own eyes out.

Time, that merciless pig feed, once made her a beauty.

The obese man, whose facial features were distorted, still maintained an arrogant demeanor: "I don't want to, spending money is so boring."

Wang Xiao chuckled: "Keep it up, keep it up!"

Mayor Huang's Russian was good enough to understand their conversation, and he couldn't help but smile.

Ovechkin immediately began to thank Mayor Huang again and again.

Without the strong support of the Xiaozhou Municipal Government, and without Mayor Huang personally endorsing the company and helping it promote its insulating gloves to various enterprises, the company would not have developed so rapidly.

Wang Xiao smiled without saying a word, knowing that this was a showcase of the integration of political and business relations, so he simply didn't interrupt and let them do as they pleased.

Fortunately, Mayor Huang wasn't one to flatter people. After a few polite exchanges, they got straight to the point and began to tour the workshop.

The new factory's workshops were really expensive.

The workshop entrance is an air shower room, and the interior of the workshop is a clean room, which is designed to maintain positive pressure and prevent polluted air from entering.

The workshop is equipped with a central air conditioning system, with strict temperature and humidity standards to ensure stable product quality. Even the walls and floors are made of smooth, dust-free materials such as color steel plates.

Everyone entering the workshop was wearing a full-body anti-static cleanroom suit, complete with a hat, mask, and shoes. At first glance, it looked just like a large laboratory in a science fiction movie, but the kind where the protagonist would be secretly huddled in a corner with their heart racing.

Zhang Bo watched the entire process, paying particular attention to the glove testing process on the production line. He then asked Ovechkin a few technical questions—too technical for the unfortunate Ovechkin to answer, so he had to call his technical supervisor over to provide the answers on the spot.

Ovechkin was quite nervous. His intuition told him that this bespectacled, seemingly kind doctor would decide whether he would go to heaven or continue to suffer in hell.

He was willing to invest heavily and continuously upgrade his technology, and now he's burdened with a mountain of loans because Wang Xiao made grand promises to him, saying that as long as his products met the technical standards, her chip factory and LCD screen factory would use his gloves.

Moreover, she would help him promote his products, recommending them to all his peers.

God, what a great temptation this is.

As is widely known, semiconductor companies are the primary users of insulating gloves.

However, in 1999, most semiconductor companies in mainland China were joint ventures, and these joint ventures were dominated by foreign capital, which held absolute control over the factories.

To ensure the stability of product quality, they will never risk using any domestically produced goods, including basic consumables such as insulating gloves.

This meant that it would be extremely difficult for Ovechkin and his mainland counterparts to get a piece of this pie—after all, the Soviet Union had little presence in the semiconductor industry.

Soviet aerospace technology was not considered suitable for the semiconductor industry.

Now Wang Xiao has brought people over to test his product. Ovechkin felt like he was back in his distant student days, sitting alone in his office, having finished a test paper and waiting for the teacher to grade it on the spot.

The room was kept at a constant temperature, but he still couldn't help sweating profusely.

Finally, Zhang Rujing nodded and gave his suggestion: "We can try it in the back-end packaging and testing stages."

He didn't mention the front-end chip manufacturing process. This is because the resistance requirements are most stringent and the range is narrowest in this area, and the closer to the unpackaged chip, the more stringent the cleanliness requirements become.

Take it slow; you can't get fat in one bite.

Starting with the back-end packaging and testing stages, step by step, you can always get a bigger and bigger slice of the pie.

Ovechkin was content with what he had, especially after gaining weight, which made him even more easygoing. So after a brief moment of disappointment, he cheered again, confidently promising, "We will definitely cooperate. We will respond quickly to any feedback and resolve the issues."

People who want to get things done appreciate the other person's cooperation. Zhang Bo greatly appreciated this enthusiastic attitude and smiled as he nodded, reminding the other person: "The semiconductor industry strives for zero defects. You need to prove that you have the same high standards and the ability to improve rapidly. Moreover, semiconductor technology is advancing rapidly, and the requirements for gloves are constantly changing. You need to continuously focus on the research and development of new materials and processes to maintain technological advancement and adapt to even more stringent demands in the future. Once you enter this industry, you can't stop; you can never stop."

After touring the factory inside and out and participating in so many tests, it was getting dark, so everyone ate lunch at the factory.

Ovechkin was quite proud because all the vegetables they ate were grown by themselves.

The factory set up a new plant in Xiaozhou, and naturally, the employees came from all over the country. Since they weren't locals, the factory had to solve their accommodation problems. After the employees moved in, their families also arrived.

The family members, who couldn't stay idle, started growing their own vegetables to supply the factory's canteen.

Zhang Bo smiled and said, "You guys are like one big family."

Look at the people eating in the cafeteria; there are adults and children, and it's clear they are all satisfied.

Ovechkin, who had already practiced, immediately toasted the Taiwanese PhD: "Please help me out more, Zhang Bo, and introduce me to more business. This whole family needs to eat."

The crowd burst into laughter.

When I left, I looked up and saw a sky full of stars.

How quiet the winter nights are! This quietness makes the stars appear incredibly bright.

Wang Xiao drank Shaoxing wine—who knows why she drank it, but she did, and she was a little tipsy, rambling on and on: "Seeing that Ovechkin is doing well, I feel relieved. They all came from Moscow with me."

Mayor Huang laughed and said, "You're so worried. You have to worry about your friends and your own employees."

Zhang Bo laughed and replied, "That's why everyone is willing to work for Boss Wang."

As a senior manager, he has his own set of logic for employing people.

For any company, the most important thing is always its people. Employees are not cogs in a machine, but living, breathing human beings. Only when they see hope in their work and feel valued will they be willing to devote themselves wholeheartedly, work purely, and even become idealists.

When a group of idealists come together, it is often a moment when miracles happen.

Everyone was in a good mood that night and slept very well.

The next morning, Wang Xiao took Zhang Bo to see the suppliers of purification equipment, and then the ultrapure water treatment system, traveling from Jiangbei to Jiangdong.

Zhang Bo followed her to look at the domestically produced grinding and polishing machines, and also at the high-purity valves, fittings, and pipes produced by the Huade joint venture factory for conveying special gases and chemicals.

Another lab is preparing to switch to industrial production of industrial robots for the automated handling and transfer of wafers and photomasks. It uses Soviet technology; the factory previously produced household service robots, making a lot of money from trendy nouveau riche, and now it's starting to make industrial robots.

And so on, and so forth.

After running all that way, everyone's legs became noticeably thinner.

Zhang Bo also took this opportunity to learn about the development of the semiconductor industry's supporting system in the Yangtze River Delta region, which made him both gratified and worried.

The good news is that there is a supporting system in place; at least it's not a complete blank.

The worrying thing is that it's too weak, and it's mostly basic, scattered, and peripheral, with a long way to go before it reaches core advanced technology.

If the semiconductor industry in mainland China flourishes, it will likely experience rapid growth driven by a surge in orders.

However, without their support, the mainland's semiconductor industry would struggle to develop a strong competitive advantage.

The chicken lays the egg, and the egg lays the chicken; one of them has to get up first.

Wang Xiao was much more optimistic than him: "It's okay, Zhang Bo, let me tell you something from the bottom of my heart. China's advantage is that it has a large area and a large population, and it has been strictly controlled."

Zhang Rujing understands the first two points: a large area with a large population means a large pool of talent and a large market.

But this tight secrecy is precisely why the semiconductor industry in mainland China is so weak.

Wang Xiao laughed and said, "Because at that time we first broke up with the United States, and then with the Soviet Union, we couldn't rely on either of our big brothers, so we were forced to develop China's internal circulation and build our own complete industrial system. Although it was very weak and had many gaps, this process instilled in mainlanders the mentality that we had to make things ourselves and could not rely on buying them from outside."

She smiled and said, "Many countries and regions develop semiconductors through a single production line. Because their land area and population limit them to focusing on one thing at a time. But the mainland is different. The mainland's market allows it to develop every industry. No matter what the initial product quality of an industry is, as long as there is an industry, it has its own supply chain, and these supply chains are interconnected."

"For example, semiconductor equipment. Nowadays, basic electronic products are all developing towards miniaturization and micro-miniaturization. This has expanded to power electronic devices, solar cells, sensitive devices, CCDs, optical discs, and other fields, and has a strong driving effect on the industry."

“Their technological advancements along another supply chain can then be applied to the semiconductor industry. The development of the semiconductor industry, in turn, stimulates them.”

"This is a process of cross-system mutual stimulation and integration. Other countries can hardly do this. Only China's population size, machinery and equipment, talent reserves, and more importantly, people's mindset, can complete the construction of this large system."

Zhang Rujing thought about it for a while, then nodded in agreement.

His homeland is indeed such a country; 5,000 years of civilization have forged its pride, and it will not easily admit its inadequacy.

"However, building such a large system is no easy task," he sighed. "We need to hurry, we absolutely have to be fast. The semiconductor industry is constantly evolving. If we don't speed up our pace and catch up quickly, we'll fall further and further behind, and it will be very difficult to keep up. The same goes for the upstream and downstream supporting equipment. Just when we've finally achieved industrialized production and met the quality standards, the international semiconductor industry has already entered the next stage, and the equipment has become obsolete."

Wang Xiao laughed again: "Hey, Zhang Bo, we might not actually be eliminated."

She sighed, “China is too big, and the development of different regions is extremely uneven. Wealthy people in big cities have already tried to buy plasma TVs from abroad that cost tens of thousands of yuan, but there are still many families, especially in remote and underdeveloped areas in the west, who still prefer a small black and white TV that costs only a couple hundred yuan.”

"In the context of chips, the international mainstream is eight inches, and some people are even building 12-inch factories. Anything smaller than six inches is considered outdated. However, these large companies have already depreciated their four-inch and six-inch chip production lines in terms of accounting, so continuing to produce them would generate pure profit. Therefore, they will not immediately abandon the relevant production lines."

Wang Xiao smiled slyly, “Large equipment suppliers are looking for new technologies because they are more profitable and can keep up with the mainstream. Smaller, newer suppliers like us can continue to seize the markets they abandon, even if the market is small and the profits are low. As long as there is a market and the competition is not too fierce, we can still survive.”

"Those who survived are all capable people who can handle things and continue to look for opportunities to take another step forward."

She smiled and concluded, "This is the unique characteristic of China, and it is also our advantage. We can use our own market to cultivate our industries."

Zhang Rujing grew up in Taiwan and later went to the United States to study and work.

Although he had traveled to mainland China several times to conduct research on the semiconductor industry, Wang Xiao's words still opened an invisible door for him, allowing him to see a world that was previously difficult to notice.

He sighed, "I'm ashamed to say that my understanding of the country's situation is still too superficial."

Wang Xiao laughed and said, "The longer you stay here, the deeper your understanding will become. It's true, the vast land of the mainland has great potential. I'm not just bragging, it's a fact. You won't find a market like the mainland anywhere else in the world."

This is a magical era in which the First World and the Third World coexist, and an industrial transfer can be formed within its own borders.

Running from January to February, Zhang Rujing once again experienced the magical era and magical land that Wang Xiao had described.

When they returned to the Jiangdong Provincial Government to report on the results of their investigation and research, and also to have a chat with the provincial leaders to see if they could get more preferential policies, they encountered a large queue at the government gate.

This time, the group was no longer composed of simple textile workers, nor were they just standing quietly.

Interspersed among them were many young people who looked like college students, holding printed leaflets and passionately proclaiming: "Our workers have been driven out of the factory, what can they do with less than 200 yuan a month? And what about our leaders? They travel abroad and feast!"

A flyer was blown to the ground by the wind. Wang Xiao saw the pattern and traditional Chinese characters printed on it and immediately realized that it was a photo of the group of middle-aged women in silk scarves who went to a restaurant, ordered a table full of dishes, barely ate any, and then posted it online for Hong Kong reporters. This photo had sparked Hong Kong netizens' expectations for a mainland "housewives property speculation group".

Oh, so this is considered an export-to-domestic resale, isn't it? After going through all the twists and turns, it returned to the mainland and became the target of criticism.

Zhang Bo frowned slightly, looking at the group of passionate people with considerable worry.

This kind of problem exists everywhere, and it's a hassle for everyone.

Wang Xiao noticed his worry and comforted him, "Don't worry too much, nothing serious will happen."

Seeing her confident demeanor, Zhang Rujing asked with curiosity, "President Wang, do you have some kind of trump card?"

Wang Xiao smiled and shook his head before nodding: "If I had to name a trump card, this would be one, albeit reluctantly. It's the divide between college students and laid-off workers. They live in two different worlds. Laid-off workers generally don't have computers at home, and even if they did before, they basically don't have the money to go online now."

Computers are so expensive! One computer costs several thousand yuan.

Internet access is so expensive these days; the mainstream way to get internet access is by dial-up.

According to the regulations of the Ministry of Telecommunications, unregistered users are charged 7 cents per minute for network usage. Registered users have a basic usage fee of 10 yuan, which limits usage to 3 hours. After that, the fee is 3 cents per minute. Any usage exceeding 100 yuan is charged separately.

Considering people's current wage levels, how many families can afford internet access?

If you can't afford to go online, you naturally can't empathize with netizens.

It's early February now, and most college students are about to go home for the holidays. Those who stay on campus generally live far from home and are reluctant to spend the expensive travel expenses, and they also have limited time to go online.

That's why Wang Xiao was so confident that they wouldn't be able to resonate with each other, and that this little matter would soon be forgotten.

It's really a small matter. Can you say it's a big deal?

In the 1980s, when factories were doing well, it was common for good companies like textile factories to organize company trips. At that time, government and public institutions were less desirable because they couldn't earn the same money and pay bonuses as factories. The latter often struggled, sometimes even failing to pay wages. Many people tried every means to transfer to factories.

These are all eras experienced by laid-off workers.

Now the tables have turned; it's just a matter of fortunes shifting every thirty years. How much righteous indignation can you expect from them?

After listening to her explanation, Zhang Bo felt as if a new world had opened up for him.

Is this even possible?

Wang Xiao chuckled and sighed, "That's why it's called a magical land. All sorts of things can happen here, and you never know when a miracle might occur. Zhang Bo, don't rush back to Taiwan. Come with me to Beijing. There are quite a few companies in Beijing working on semiconductor equipment. Even if it's not mature yet, I want to see if there's any potential for development."

When it comes to concentrating resources to accomplish major tasks, relevant units in Beijing receive the greatest support and invest the most capital.

Although they are generally less advanced in terms of commercial and industrial production—they have a weaker market-oriented economic consciousness—once they have the technology, she doesn't mind investing money to start production.

Moreover, Ivan is also leading a delegation to Beijing for negotiations.

Wang Xiao was genuinely concerned about the export quota negotiations. If the deal went through, the container market would have another source of goods, saving a lot on tariffs.

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Regarding the situation of domestically produced semiconductor equipment at that time, the main reference is "The Current Situation of China's Semiconductor Equipment Industry" by Wang Bohua (Electronic Information Products Management Department, Ministry of Information Industry). His analysis covers the situation in 2003, which differs from that of 1999. Therefore, if you find this article, you'll discover that the situation he describes is not entirely the same as what's depicted in the novel, because several years have passed.