Process

of a senior manager, because this also may show the degree of trust from investors. In ASML’s case even customers became investors to accelerate the development of the technology. This expresses the trust of the customers

The four quadrants, illustrated in figure 5, are emerged from the data of this case study.

The axes are not case specific, but rather transferable to examine the framing strategies in other cases.

Figure 5: Typologies of framing strategies.

4.2.1. Confidence and incremental framing

The first framing strategy to explain, that emerged from the data analysis, is confidence and incremental framing. The framing strategy includes a high degree of certainty about the technological change and a relatively low sense of urgency. The following quote of CEO, Peter Wennink, shows a strong internal believe in technology, thus, high internal certainty and confidence. The urgency however, is less obvious, the CEO mainly explains the EUV operational performance in an incremental manner. Peter Wennink (2014-02):

Lastly, I want to repeat that we strongly believe that the scaling and related near-term technology challenges in logic and memory explained in the previous trend discussion create an increasing need for EUV in order to continue the cost-effective scaling that has driven this industry for the last 50 years. Our lithography cost modeling continues to show that EUV can drive down critical layer imaging cost to reduce spend on patterning-related deposition in etch and its associated costs for [clean room] space while reducing cycle time and very likely improving yields that come along with process simplicity.

The next quote indicates a more incremental approach too, as the CEO frames the technological change, in this case, progress with lower urgency compared to prior framing. Also Wennink talks about “once operational performance are demonstrated and accepted”, this is considered to be not real urgent communication. Internally there continues to be a high level certainty in EUV, by emphazing the “as most of you are aware, we continue to demonstrate real progress against our targets”. The full quote of Peter Wennink (2015-02): “And finally, on EUV. As we are -- as most of you are aware, we continue to demonstrate real progress against our targets in system throughput and system availability. These are the key metrics of performance that drive new lithography technology adoption once imaging and overlay performance are demonstrated and accepted.”

The confidence and incremental framing strategy is only used by the second CEO, Peter Wennink, from the beginning of his career as CEO at ASML (2013) until the end of my observation period (2020). The framing strategy emphasizes on the future potential of the technology combined with the CEO’s strong believe of this potential. The technology’s potential is communicated by emphasising on the importance of the technology, customers’

demand for the new technology and their readiness to adopt it.

4.2.2. Confidence and radical framing

The second typology of framing strategy is confidence and radical framing. In this framing strategy the senior manager demonstrates a high level of internal certainty towards the technological change and communicates this with a sense of urgency. In 2012, the EUV technology was introduced, but ASML was not able to deliver it with the right operational performance yet. In the quote below, Eric Meurice CEO at that time, discusses the fact that ASML is delayed in bringing the technology to the market. Although the company cannot deliver what they promised, Meurice still communicates with confidence, as the CEO mentions

the most important part is made, namely, the recipes and the fact that customers are ready and wait for EUV to be ready to get there, shows a certain urgency. Eric Meurice (2012-01):

So, as we said a numbers of time, there are certain numbers of phases when you introduce such a technology. The first phase is to have some R&D tools to do some recipes and confirm the technology. That's what we've been doing. And although there have been delays in our credibility, by the end of the day, the recipes are being made.

And the windows of opportunity is as you mentioned, and we have not lost any of them yet. The first window is DRAM 1x or -- so I think you call it 1x or 1y. They are very near the 20 nanometer. This seems to be very complicated to execute with multiple patterning. And the customers are ready to, in fact, wait for EUV to be ready to get there.

In the following quote of 2013, quarter 3, the first part indicates high internal certainty of ASML about EUV: “Since the benefits of EUV are clearly understood, and any future node will surely require a significant amount of EUV”. The second part of the quote illustrates a more radical approach, because of the indication that customers want to introduce the new technology as soon as possible. “customers are indicating that they are likely to introduce EUV as soon as possible in order to gain experience in the full industrialization of EUV into manufacturing.”

Within ASML confidence and radical framing is the most used framing strategy.

Throughout the whole period the framing strategy is used. However, between 2013 and 2016 there are some quarters in which this specific strategy is not utilized by the senior managers.

Within confidence and radical framing, senior managers communicate technological changes with a great extent of internal confidence about the technology and there is emphasis on the benefits for customers in terms of value adding, and how the technology improves performance.

Furthermore, technological attributes are explained to the audience. Lastly, it shows that customers require the technology and they are actually adopting it.

4.2.3. Careful and incremental framing

Senior managers frame technological changes more careful and incremental, which is the third framing strategy, when there is lower level of internal certainty and less urgency.

ASML’s senior managers barely use the careful and incremental framing strategy, only in the period of 2014 first quarter to 2015 first quarter. In the following quotes become clear how the technological changes are framed when using this specific strategy.

In the next quote there is not a real sense of urgency. Furthermore, the CEO communicates that ASML is not sure whether customers will make use of their EUV technology or another technology. Peter Wennink (2013-03): “We have learned from very recent discussions with leading logic customers that they have succeeded to develop two lithography introduction strategies for the 10 nanometer node. They will either use a very intensive, immersion-centric approach or an EUV-centric approach for the 10-nanometer critical layers.”

In 2014, EUV was still not cost efficient enough for customers to adopt in their manufacturing processes, as the technology was too slow. Uncertainties arose about the possibilities of EUV within the audience. Wennink responds to this uncertainty with a careful and incremental approach. Peter Wennink (2014-02):

Wolfgang has highlighted the current landscape and near-term uncertainty and timing of leading-edge capacity additions in the foundry space. Such uncertainties are not uncommon at the beginning of new complex and challenging node transitions, especially since these transitions over the last four years have been the most aggressive in history. These uncertainties might be exaggerated by the current competitive environment and by a consolidating foundry customer base in advanced notes which brings a specific and relatively new dynamic to this industry segment.

Only CEO Peter Wennink utilizes the framing strategy confidence and incremental framing in the period from third quarter 2013 till first quarter 2015. The reason for this might be because of the longer term uncertainty in the market. From 2015 the market turned its corner about the new technology, EUV. Within careful and incremental framing strategy senior managers point out the technology’s possible potential by indicating that operational targets will be met soon, the probability that customers will choose the technology, and that by admitting there is some uncertainty in the technology transition.

4.2.4. Careful and radical framing

Careful and radical framing is the fourth framing strategy which is used by senior managers to communicate technological changes. The strategy includes a high degree of urgency, but the internal certainty of the technology is not too high and therefore, the communication is careful as the technology is not good enough to deliver to its customers. The technological change is framed with urgency as “The bad news is, in situ we may discover a number of cleanup activities, optimization that may have an impact of months to the situation”.

Eric Meurice (2012-01):

We have increased our level of confidence. But this is not sufficient and good enough, because the customers haven't seen all of these upgrades in, as I said in the speech, in situ. In situ means you try all this into the same machine, and as expected into our business, you discover a bit of issues. So, on one hand, the message that we give you today is a message of we now confirm our concept and we are absolutely at 60 wafers or more per hour. There's no question. The bad news is, in situ we may discover a number of cleanup activities, optimization that may have an impact of months to the situation.

CEO Wennink emphasizes the complexity of the technology, explaining the complexity of the technology is an example how the executive tries to gain legitimacy for the technology that has a delay. Peter Wennink (2014-02): “As is the case and logic, these technology transitions are complex and it is therefore not surprising that a pause of vertical NAND capacity buildup is occurring”. Certainty is not especially high in the case of explaining the complexity, therefore, it is framed carefully. Furthermore, Wennink says technologies need to be developed further so it becomes interesting for clients to choose for the technology. “Occurring until the time that these technologies can be developed to a point where they are cost-competitive with current and future planer nodes.”. The urgency is to keep on developing in order to make the technology viable.

In the next quote, again the internal certainty about the technology is not specifically communicated. Peter Wennink (2016-03): “Increasing customer confidence in EUV for manufacturing readiness is critical at this point in time. ASML remains committed to do everything within our capability and power to bring EUV to manufacturing readiness.”

However, there is a strong sense of urgency in the quote “critical at this point in time” and

“committed to do everything within our capability and power.

The framing strategy, careful and radical framing is utilized by both CEOs in the period between 2011 and 2020. Nonetheless, in the beginning years of EUV’s introduction this framing strategy was more used compared to after the industry turned its corner on EUV in 2016. The framing strategy careful and radical framing articulate the progress of technology in different ways, the phases of introduction, the complexity, emphasis on improvement, and the message that increasing customer confidence is crucial for EUV’s manufacturing readiness.