Nations Of Notebooks

According to Chen, the $50 million company enjoys profit margins of 15% to 20%; the notebook business is growing at a steady 30% a year. The point, he says, is that relationships are everything: a Pucka salesman visits FIC every day to make sure all needs are met. "Our policy is 24-hour access for our customers," he says. "We do whatever they want."

The next stop after Pucka is Chan Soong Industrial (CSI), a plastic-injection-molding supplier in Taoyuan, another Taipei suburb. In the car, Tsiang says CSI ranks as one of FIC's best suppliers. When Tsiang and his team arrive, "Jaguar" Tony Chang receives them in a conference room filled with hundreds of empty plastic notebook computer cases -- representing every major notebook maker from Apple to IBM. Chang is the 43-year-old general manager of CSI, an industry veteran, who spent 17 years working in the plastics field before joining CSI in 1987. By Taiwan standards, Chang is wealthy, a man in a position to indulge his penchant for expensive European cars, particularly sleek Jaguars. His late model XJ-6 sits out front of the nondescript factory next to CSI President John Chen's Mercedes.

Chang's wide network of relationships helped pave CSI's smooth entry into the notebook field, starting with a deal with Twinhead, Taiwan's notebook pioneer. CSI now has a 50% market share, producing 100,000 units a month for a variety of notebook manufacturers. Since 1992, CSI has doubled the number of its employees to 120 and tripled its plant area; overall the company has grown 166% to $25 million in sales.

"We work very hard in the right way," Chang says. "If you don't do it right, you lose your dignity. Respect is very important in our culture. Everyone wants to get their product to market. It's always urgent and changes are not on the schedule."

CSI recently opened two new factories to meet demand. Chang says the company will work 24 hours a day, 7 days a week to meet its schedules. Its manufacturing approach, Chang says, is designed to minimize the waste and inefficiency that come with errors detected late in the process. CSI first builds 100 "try shots" or samples; it then begins production runs in incremental jumps, from 1,000 to 10,000 and on up. If there is a flaw, Chang says, CSI absorbs all the costs.

Tsiang recalls a battery-pack casing that CSI built. During the ramp-up in the production of the notebook, FIC discovered the battery pack was overheating and the engineers needed to make holes for ventilation. "CSI made the change in three days," Tsiang says admiringly. "They'll do whatever it takes. They'll redo it until it's right."

Not far away, on Fu Ying Road, a cramped, dingy sidestreet in Shin Chuang, Y.S. Chen, a 42-year-old former factory worker, sits in the second-floor office of the company he founded 16 years ago, aptly named Power Success Co. He and his family live in an apartment in the same drab gray building. Chen works from 8 a.m. to midnight seven days a week, overseeing his 28 employees who are tooling the steel molds that create the plastic cases for the notebook computers.

This visit is, in part, a chance to see Power Success Co.'s proudest corporate icon: in a glass case hangs a note of commendation from an IBM executive in the United States. In July 1995, IBM requested a design modification, through ASE, its Taiwanese OEM, for its newest Thinkpad notebook. IBM needed the modification in two days. Even under ideal circumstances, it was a five-day job. Chen set the already-stressed factory into overdrive, operated around the clock, and provided the changes on time. It never occurred to him not to meet the customer's request.

The letter is one form of religious icon. Above the shop floor where several workers cut and buff the steel molds, incense burns around a laughing Buddha and wafts into the shop. Is this a manifestation of the Confucian culture, the spiritual component of the deeply ingrained work ethic that permeates the Taiwanese economy? Chen laughs. This, he explains, is a more worldly kind of god: "He helps us earn much money."

Chen himself has a brand new Volvo 960 sitting out front of the factory and a large-screen television in his office. But he has no time to enjoy these luxuries. He has built a strong reputation for delivering high quality, low cost, and on time -- giving him connections with nearly every major notebook maker in Taiwan. Revenues have nearly tripled since 1992 to $3 million. "We're at full capacity now," Chen says. "And we expect to be for the next 30 months."