A Big Fish in Chips

IBM's Essex Junction plant is one of the world's top producers of semiconductor technology.

by Virginia Lindauer Simmon

Hank Geipel wears two hats at IBM in Essex Junction. In his "what" hat, he's vice president and business line executive for IBM Microelectronics Division worldwide; in his "where" hat, he manages the infrastructure at IBM's Vermont location and represents the company in Vermont with state, local and federal governments and organizations.

Opportunity has a way of following tragedy. It happened 48 years ago after the American Woolen Co. closed its three textile mills in Winooski, leaving more than 1,000 people jobless and vaporizing our region's economy.

A group of 50 forward-thinking (and scared) municipal officials and civic leaders leapt into the breach and formed the Greater Burlington Industrial Corp. (GBIC). Their goal was to create sustainable economic opportunities for the region, and fast. Three years later, in 1957, International Business Machines opened its manufacturing facility in Essex Junction.

While GBIC deserves credit for the work it did then and continues to do, it's probable that IBM never would have come to Vermont had its then-president, Tom Watson Jr., not had a second home here and loved skiing so much so, he bought Madonna Mountain, forerunner to Smugglers' Notch, in 1964.

Watson Jr. had been given the job of president of IBM by his father, Tom Watson, in 1952 and became chairman of the board in 1956. Watson had built the company into a superpower known for its tabulating machines and other business tools, but for the next 15 years, it was his son who set IBM on its path to the future, developing the family of compatible computers that could fill every data processing need.

Tom Watson Jr. had already left IBM when, in 1974, the company sent a young man named Hank Geipel, fresh out of Rensselaer Polytechnic Institute with a Ph.D. in electrophysics, to Vermont as a senior associate engineer. Geipel was to be instrumental in moving the Vermont site through yet another evolution.

A native New Yorker educated in New York City public schools, Geipel had been fortunate to be able to attend Brooklyn Tech, one of New York City's four special high schools, this one focusing on technology. "It sparked an interest in engineering and architecture," he says. "I got to go to a programming school over Easter once, in 1963, and learned to program."

He applied to engineering schools and was accepted at RPI, where he earned his bachelor's degree in electrical engineering in 1969. By then, he had met and married Diana Stratton. "We met at the YMCA in New York in 1967," says Geipel. "I was a swimming instructor, and she was a counselor." Two months after they moved to Vermont, their daughter, Gretchen, was born, followed in 1978 by a son, Craig.

In 1974, IBM in Vermont was "predominantly a memory site manufacturing memory chips on 57 millimeter (2 1/4-inch- diameter) wafers," says Geipel. "We had two process lines FET [field effect transistor] and bipolar semiconductors neither of which exists today."

A chat with Geipel is riddled with industry jargon and acronyms, which for the uninitiated, can be pretty daunting, but he takes time to elaborate on cryptic terms. He comes to an interview carrying notes and accompanied by Jeff Couture, manager of communications and public relations, and John O'Cane, manager of state external programs.

Courtesy IBM Corp.

A photolithographic process millions of times more precise than that used by the printing industry prints circuit patterns on chips. This and other operations are performed by computer-controlled robotic devices in "clean rooms."

Semiconductors do one of three things, says Geipel. "They either store information [memory chips], perform logical functions [logic chips] or do number computation [microprocessor chips]. We make semiconductor products that do these things individually or in combinations."

Through the 1980s, says Geipel, the Essex Junction site remained predominantly a memory chip manufacturer, as wafer size grew from 57 millimeters to 200 millimeters (8 inches) by the 1990s.

A wafer holds a collection of computer chips. A chip is made up of many layers of circuitry, each of which is a detailed pattern. Some of the layers lie within the silicon wafer and others are stacked on top. The manufacturing process consists of forming this sequence of layers precisely.

Microscopically small circuits, some 500 times smaller than a human hair, are built on successive layers of silicon dioxide. On some IBM logic chips, there may be up to six layers of minute interconnecting wires joining together more than four million circuits. One of IBM's advanced 200 millimeter memory wafers contains as many memory cells as there are people on Earth.

By the end of the '90s, the site had completed a transition from memory manufacturing to becoming a producer of logic and microprocessor chips, which are more complex, but are also more profitable. At the same time, the site moved from being a captive supplier to IBM, designing products specifically for IBM hardware, to becoming a profit-and-loss center developing products for the general market as well as for IBM. "In 1992, we started on this journey," Geipel says, "so in 1992, our visibility was zero outside of IBM; today 60 percent of what we make goes to the outside market, and it's on the way to 70 percent."

A huge challenge was deciding which markets to pursue, "because the needs of semiconductors are broad and pervasive," he says. "You can find chips in your fuzzy logic rice cooker to cell phones to your Internet connectivity to super computers that study weather, the human genome and everything in between. There's a high probability that every time you connect to the Internet, within three levels you will find our componentry.

"We play strongly in pervasive computing, including things that are, for example, consumer devices, access devices for the Internet or microprocessors for games (Nintendo is one). We also introduced the Power PC architecture in the '90s."

"We took Power PC technology and moved it from only personal computer applications to mainframe and to consumer electronics," says Couture. "It's become a very reliable product line. We've been able to scale up or down to various applications, and we manufacture the various flavors of that line."

While these shifts away from memory manufacturing were occurring, Geipel was making some transitions of his own. "In 1982, I worked for a gentleman named Ed Gardner," he says. "He convinced me I'd have more influence if I moved out of technology and into the management ranks. I agreed to do it for one year. I loved it."


John Hagwood, manufacturing program manager (left), John DiToro, vice president of worldwide manufacturing for IBM Microelectronics Division, and Sue Bombardier, DiToro's technical assistant, talk with Hank Geipel in an alcove area near Geipel's office.

Today, the Vermont site is part of IBM Microelectronics, a division of the Technology Group of IBM. IBM Microelectronics is located in multiple countries, says Geipel. "Burlington is the main facility office of the division. We're bringing up another main entity in Fishkill, N.Y.," he says, referring to the Microelectronics division headquarters. "We're building a 300 millimeter (12-inch) wafer manufacturing line, the next generation, there.

Geipel wears two hats for IBM: what O'Cane calls "a 'what' hat and a 'where' hat." Wearing his "what" hat, he carries the title of vice president and business line executive, "responsible for the information technology part of our business, which includes providing chips for computers known as servers, so I have profit-and-loss responsibilities."

There are five groups in the information technology section Geipel manages. It's a multi-billion dollar activity. "Over the years, we have moved from a hierarchical organization to a matrixed, results-oriented organization, so I have people in a half-dozen locations," he says. "My business responsibility is worldwide."

His "where" hat carries the title of senior location executive for the site, which involves responsibility for the infrastructure and representing IBM in Vermont with state, local and federal governments. He gets involved with the Chamber of Commerce and GBIC, meets regularly with the governor and the Legislature and participates in various initiatives.

"I meet with senators Jeffords and Leahy, usually to discuss possible effects of legislation on our business," he says. "We met with Sen. Jeffords with respect to when we changed our retirement program," he says referring to the corporate decision last year to convert IBM's traditional defined benefit plan to a "cash balance" plan, an announcement met with dismay by many workers and attempts to unionize.

Challenges come from bricks and mortar as well as people. "We have manufacturing here, but this site is almost like a city," Geipel says. We have infrastructure, a cafeteria, education facilities, a library, waste, energy, power generation, and over 700 acres with 3.5 million feet of capped space."

"That amounts to 4 1/2 acres of roof," says O'Cane, adding, "Our electric bill is in the tens of millions of dollars; we have our own fire department, our own haz-mat service, emergency medical services, security. We even have our own bridge."

"We're very good corporate citizens and residents," says Geipel. "We've been recognized many times for our environmental consciousness and activities and results. We've received the governor's Pollution Prevention Award in each of the nine years they've been doing it."

IBM could be called a gentle giant when it comes to wielding its immense power in Vermont. "In recent years, what the state and towns do increasingly impacts IBM's agenda," says O'Cane, "so we're increasing input to make sure that they know the impact." He mentions the Circumferential Highway project. "Because we don't have it, it has raised significant concerns about traffic, and it becomes an issue when we try to build or do other activities that require permits.


courtesy ibm corp.

IBM was the first to introduce copper technology into volume production and has since incorporated copper into stand-alone Power PC processors for Apple as well as its own RS/6000 servers. Copper technology is also integral to this tiny S/390 central processor.

"Mercury in the environment is a legitimate concern," O'Cane continues. "I testified yesterday about a ban on mercury products that would have made it impossible for us to manufacture our semiconductors."

At the same time, the company has dedicated itself to good corporate citizen activities, such as education. "We have a concern about making sure students get exposure to math and science," says Geipel. "So when Lou Gerstner [IBM's CEO until March 1] put forth a program called Reinventing Education, we were able to get a grant called Standards into Action." The Standards into Action project will enable teachers to partner, network, collaborate and share electronically in an easily searchable, on-line environment.

Other education activities tie into Engineers' Week. "In February and March, 200 to 250 of our employees are in classrooms talking to between 3,000 and 4,000 students," Geipel says. He mentions employees who are adjunct professors at the UVM school of engineering and an IBM-er who is the principal investigator for Vermont Institute of Science, Math and Technology.

Last summer, IBM sponsored Camp Excite, hosting 31 seventh- and eighth-grade girls from three schools. It was a week-long day camp with a focus on engineering and technology, and each of those girls continues to have a mentor of one IBM female engineer.

Geipel seems quite comfortable with all this responsibility. Along the way, he has managed to publish numerous papers, presented at conferences and has "become a rather prolific inventor. I have about 30 publications and papers in my repertoire," he says.

It's no surprise, then, that he spends his personal time going in other directions. "I dabble in cooking," he says with a slight grin, then goes on to describe an "Iron Chef" competition he hosted a competition between him and his son-in-law, Alex Lonovich, over the holidays. "The ingredient was grilled shrimp, and much to my dismay, I lost!"

O'Cane, one of the judges for the competition, looks chagrined as he describes the dishes Geipel and his son-in-law made from the theme ingredient and the required three out of five other ingredients. Lonovich's grilled shrimp on rosemary skewers with Thai peanut dipping sauce presented in a bowl made of jasmine rice bested Geipel's shrimp and salmon tartare, tequila-flavored gazpacho and Asian grilled shrimp served with latkes and a black bean and yellow squash salsa.

When he's not cooking, Geipel is an avid reader and enjoys perennial gardening. "I have half a dozen different beds around my house. I prefer articulated rather than English gardens and specialize in the more rare and exotic. I'm in it for the visual beauty, totally different from what I do." Still, he tracks his specimens on his database.

Geipel has somehow avoided the traditional lot of IBM employees who dubbed the company "I've Been Moved" for so many decades. With only three short assignments away from Vermont, he has managed to live here for his entire IBM career.

Of course, the future could go anywhere. "Right now, we're in what people have called 'The Perfect Storm,' he says. "The industry is down in its valley. This is a cyclical business. We have a pretty wide portfolio that allows us diversity. And we have the best intellectual property." For the seventh year, IBM is the world leader in patents, he says. "Roughly 1,000 came from IBM Electronics, and, of those, 300 came from here. Even I have a few patents." He grins.

Regarding his personal future, he's even more sure. "We like living in New England. I'm pretty sure we'll stay." •

IBM's Vermont facilities cover more than 700 acres in Essex Junction and the towns of Essex and Williston. There's 3.5 million feet of space under roof.

Originally published in March 2002 Business People-Vermont