Long-serving CEO looks at sensors, industry’s past and future

June 30, 2016

San Jose, CA. “Sensors are going to be everywhere,” said Ray Zinn, speaking June 23 at Sensors Expo & Conference. “The IoT is all about sensors. Sensors are the wave of the future, and that’s why we are here.”

Zinn, recently retired from Micrel when that company was purchased last year by Microchip, is billed as the longest serving CEO in Silicon Valley. Zinn founded Micrel in 1978 and wanted to be in control, shutting off traditional funding methods. Rather than approach venture capitalists, he tried to get a bank loan. But unfortunately bankers would not lend to startups. He urged the bankers, using what would become an industry mantra, to “think outside the box.” He asked, “If you were to lend to a startup, what would it take?” The bankers’ reply, “You would need to be profitable from day one.”

That condition, he said, precluded building a company first and adding products later. So he reimagined Micrel as a semiconductor service company, only beginning to add analog products—not yet in vogue at the time—in 1985. Indeed, he said, the company was profitable from day one, having lost money ($50,000) only in 2002, with the consolidation of two fabs down to one.

He attributed the company’s success in part to being employee-driven. The company’s focus on employees was unique, he said, and allowed Micrel to survive multiple major business cycles. “Being driven is what defines success in high tech, semiconductors, and humanity,” he said.

“Silicon Valley is successful because we believe in change,” he said, adding that innovation occurs at the intersection of thinking and action. “Ideas without action never changed anything,” he said, urging the audience to “…act to make human progress.”

Efforts to change can meet with resistance, however. Zinn cited a “gulf of disapproval” that can last several years. He cited an acquaintance who called Zinn’s ideas “dumb”—that person became Zinn’s employee several years later. A key point, he emphasized, is that customers cannot tell you what they need. They are resistant to change. You must convince them that your product idea is going to solve their problem.

He added a personal comment on his interest in sensors. Zinn is legally blind (his wife of 55 years, DeLona, assisted him with his presentation) and doesn’t have a driver’s license. For people like him, sensor-laden autonomous vehicles can open up new opportunities for mobility.

He closed with some comments on public policy. Politicians don’t focus on the semiconductor industry, as many companies have offshored their manufacturing operations for tax and other reasons. Sectors that don’t pay much tax don’t get much attention. The California wine industry, he said, is bigger than the semiconductor industry. The U.S. semiconductor industry must decide whether it wants to be software-oriented or regain manufacturing capability.

Small companies, Zinn said, need to be customer-centric to survive. Big companies tend to lose their customer focus. He attributed Micrel’s success to being “…the biggest small company in our industry.”

The future, he said, “…is up to you. You have to decide what you want with this industry.”

Attendees received copies of Zinn’s book Tough Things First. A book signing took place after Zinn’s presentation.

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