In Good Company with Nicolai Tangen - Lisa Su CEO of AMD

Episode Date: October 5, 2022

In this episode, Nicolai Tangen talks to Lisa Su CEO of AMD. They talk about why semiconductors are so critical to the global economy, how Lisa has led one the greatest turnarounds in the technology sector and current geopolitical challenges.They also discuss leadership, building teams, future of AI and Lisa even share her proudest moment.The production team on this episode were PLAN-B’s Martin Oftedal and Olav Haraldsen Roen. Background research were done by Sigurd Brekke with additional input from our portfolio manager Richard Green.Links:Watch the episode on YouTube: Norges Bank Investment Management - YouTubeWant to learn more about the fund? The fund | Norges Bank Investment Management (nbim.no)Follow Nicolai Tangen on LinkedIn: Nicolai Tangen | LinkedInFollow NBIM on LinkedIn: Norges Bank Investment Management: Administrator for bedriftsside | LinkedInFollow NBIM on Instagram: Explore Norges Bank Investment Management on Instagram Hosted on Acast. See acast.com/privacy for more information.

Hi everyone, and welcome to our podcast, In Good Company. I'm Nikolaj Tangen, the CEO of the Norwegian Southern Wealth Fund. In this podcast, I talk to the leaders of some of the largest companies we are invested in, so that you can learn what we own and also meet these impressive leaders. Today, I'm talking to Lisa Su, leader of the semiconductor company AMD. Now, you may not have heard about AMD, but they make the fastest semiconductors and also help construct the fastest and best supercomputers in the world. We own 1% of the company, translating to over 25 billion kroner or more than 2 billion US dollars. Now Lisa has led

one of the greatest turnarounds in the technology sector ever, and she's widely considered perhaps the best CEO in America. You don't want to miss this one. Tune in. Lisa, many people consider you the most impressive CEO in America, so we are particularly pleased to have you on the show today. What an honor. You are too kind. Thank you, Nikolaj. It's great to be here.

You know, the revenue into the Norwegian Southern Wealth Fund is from oil and gas production over the last 26 years. And some people say that semiconductors is the new oil. Now, why don't you tell us what your semiconductors do? Yeah, so we are very excited about, you know, look, I've been in the semiconductor industry, you know, over 30 years. And there were times when nobody knew what a semiconductor was. when nobody knew what a semiconductor was. But today, I think everybody at least appreciates that semiconductors and chips can help power numerous things, whether you're talking about the chips that are important

for data centers and large enterprises to run their businesses or the chips that power our personal electronics, our cell phones, our PCs, our cars, all kinds of things in our homes. So I think you see semiconductor chips everywhere. We're kind of the key ingredient to make all of these devices smarter. But you focus in on the really powerful ones. We are. We are focused at AMD.

We're focused on the high performance, the bleeding edge of technology. We build processors for large data centers, for personal electronics. We also build a number of adaptive computing chips that have come in with our acquisition of Xilinx, which are focused on programmable content where you can actually tailor the chips for the particular application that you want, whether, again, in your cars, in your communication devices, in aerospace and defense and industrial and all those areas. So when you look at AMD now,

what do you think is the most fascinating part of the company? Well, what I love about what we do, Nikolai, is that we're actually, you know, touching so many different applications. And, you know, our chips really, you know, go from, you know, the largest systems in the world to, you know, everything that touches, you know, sort of billions of people. So it's kind of fun to work on, you know, technology that can impact, you know, so many people's lives. Yeah, I believe that you are powering five of the top 10 most powerful supercomputers in the world. And I read that you're working on one which is even faster.

So first of all, I mean, what is a supercomputer and what can they do, actually? Yeah, so think of supercomputers as the fastest of the fast. as the fastest of the fast. So, you know, they're basically, you know, very, very large systems that are made up of thousands or tens of thousands of processors that are put together, you know, in large systems. And the whole idea is, if you want to, you know, sort of solve a really hard problem, whether, you know, you're looking at, you know, sort of energy modeling, or you're looking at, you know, climate change, or you're looking at the origins of, for example, vaccine development and those types of things. You need very large systems that can actually take a lot of data and simulate it in a reasonable amount of time.

We are very much involved in the supercomputing world. I'm very proud to say that, you know, right now we have the fastest supercomputer in the world. It's called the Frontier Supercomputer that's based at Oak Ridge National Labs. And it has actually exceeded one exaflop, which is, you know, again, a big, big milestone in computing history. And that's based on AMD technology together with our partner, HP Enterprise, and the US Department of Energy and the Oak Ridge National Labs. But that technology is applicable

to a lot of different areas. And so, yeah, we're very excited about supercomputing. So is that like your proudest baby? It's like all my products are my proudest babies. But yes, it's quite near the top, actually. We just put it, you know, we just sort of dedicated it, you know, just about a month ago. And it was quite fun to represent the team in that. But every time I launch a product, it feels like it's your proudest baby.

That's good. So as these computers become faster and faster, how are we as normal people going to see the change? Well, I think we see it in various places, and hopefully everyone does see it in their daily lives. In terms of the electronics that are closest to us, it's more capability, your data at your fingertips, longer battery life. Really, we're using more and more devices

for each of us. And then as it relates to businesses, I think what we're trying to do is really help businesses sort of modernize all of their business applications. And that includes a lot of work that we do with large data centers. And most of us are in a hybrid environment these days in the sense that we have some of our own computing and we use cloud computing. And so the idea is really to provide a lot more capability so that we can modernize all of our business processes as well as sort of our personal daily lives

should have access to a lot more technology and a lot more data. Changing tacks a bit, you were born in Taiwan, and I appreciate your mood when you were quite small, but how come Taiwan has become such a superpower in the semiconductor industry? Yeah, it's an interesting point. I think it's really an evolution of when you think about where semiconductors have come from, right? It used to be, and like I said, you know, back in the 80s and 90s, you know, we were at a place in the semiconductor industry where, you know, people tended to build their, you know, sort of their

own designs as well as their own factories and their own manufacturing capabilities. But as we've gone to more and more sophisticated semiconductor technology, frankly, it takes billions and tens of billions of dollars to build those manufacturing capabilities. And so this whole advent of foundries or companies that really allow all design companies to kind of use a common manufacturing site was kind of a big thing. And Taiwan was early

in recognizing that and they built an infrastructure around that. But I think the overarching, you know, conversation is, you know, semiconductors are, you know, investments take years, you know, to see return on investment, sometimes decades to see return on investment. And so it's important to really, you know really be in and be in for the long term. But I mean, is it random that you are now running a semiconductor company? My parents, and you can appreciate this, I can say this about Asian parents in general, very focused on education, math and science. My dad was a mathematician.

My mom was a mathematician. My mom was very much an entrepreneur. And so engineering may be a little bit in the blood. And it turns out that semiconductors are pretty exciting. I like the idea of building products. And so being able to build something and feel and touch something is kind of what attracted me to semiconductors. How do they shape your aspirations? I mean, we see successful people come, you know, we see the results.

But how is it to be born into such an aspirational environment? Well, I would say it was, you know, for me, it was really around always, you know, my parents encouraging me to, you know, always be the best I could be. Like I said, education was very important. Math and science was very important. And, you know, at a young age, the whole idea of, you know, you can make a big difference in whatever you do, I think, you know, encourages you. But I would say also, you know, this is all very much around, you know, how important, you know you know how important um you know education is and you know science and and stem education is and so i think i was very much a product of that moving on to um to amd so um when you took over the company um the share price was very low and

you know being there for for a while um the value of the company is 22 times bigger. So one of the biggest turnarounds in American history. First of all, well done. Thank you. What were the big decisions you made to create this turnaround? Well, I will tell you what attracted me to AMD to begin with is there are very few companies in the world that can operate at the bleeding edge of technology. And that's sort of where my interest has been, right?

How do we keep pushing the envelope on sort of the next big thing from a computing standpoint? And so that's what attracted me to AMD. And in terms of, you know, over the past, I've been CEO about eight years or so with a company about 10. It really is with technology. It's about making the right technology bets. And sometimes you actually have to be patient. You might have to take a step back to take a step forward. And so for me, it's been focusing the company on our products, our product roadmap, making

sure that we're making the right technical bets, seeing the inflection points in the technology, and earning the trust of our customers. Because at the end of the day, it takes a while to earn trust. And it's really important to be able to kind of show data points along the way. I've heard you talk about, to effectuate that kind of turnaround, what you call extreme communication. What does that mean? Well, I think when you have, you know, a company of any size, but certainly, you know, we started sort of seven or eight years ago, we were about 10,000 people, we had to get them kind of focused on sort of what were the most important things. So extreme

communication in my world is a lot of repetition on hey this is this is what we want to do this is what we want to be when we grow up this is how we get there and by the way these are the steps along the way and it's been uh it's you know really been a bit of a journey for me because i would say that uh naturally i'm more of an introvert and so i had to decide that um you know we have to communicate a lot more. So there's a lot of communication learning along the way. Yeah, you certainly seems like you got the message across. I mean, you surpassed Intel and I have the feeling you're not very keen on talking about competition in particular companies. But if you look at competition generally, what is it that you have

done better? Well, look, first of all, I think the markets that we're in, you know, when you think about, you know, high performance computing, when you think of adaptive computing, these are great markets, right? These are secular growth markets over, you know, the next decade, you know, people will need more compute. And there are very, very few people, very, very few companies in the industry that can provide it. You know, competition is always fierce, right? I mean, this is, this is what it means to be in sort of the pinnacle of, you know, sort of the technology industry is that competition is always fierce. You know, my view of the world, though, is it's most important for us to be clear about where we

can differentiate and, you know, where can we add value that's sort of different than what others can. And that's why we've been focused on, you know, certainly our foundation around technology, but also adding additional components. You know, we acquired, you know, Xilinx as the number one player in FPGAs and adaptive SOCs. That adds just tremendous capability to our portfolio. And so, you know, it's been very much a view of we have a lot to offer. And as we add more technology capability,

we become even more strategic to our customers and partners as we go forward. Moving on to the corporate culture. So all leaders say that their employees are really valuable, but yours are actually very valuable. If you take the value of your company and divide it by a number of people, they are worth basically $8 million each. How do you manage to retain your great assets here? I didn't think I had done that math, Nikolai, but okay, that's a good number.

For us, it's about ensuring that every employee knows how they connect to, you know, our mission and our and our values and what we're trying to do. And, you know, that is one of our, you know, selling points, I would say, because, you know, there are others in the industry who might be larger. But, you know, I think what we're trying to do with our, you know, company and our culture is to ensure that, you know, if you want to do bleeding edge technology, and you want to make a difference, you know, come to AMD and do that. And I think people have felt that they have outsized impact on the technology industry in terms of, you know, just the decisions that they get to make, the empowerment that they have,

and the impact that they have on the company. But absolutely, this is on my mind all the time as we grow as well, because we want to, you know, as we scale as a company, we've grown a lot. I mean, we started with maybe around 10,000 people seven or eight years ago. You know, this year we're at 25,000. So that's a lot of new people that are coming into the AMD culture. You know, we want to maintain that view of, hey, you're extremely empowered and extremely capable to do the right thing. Yeah. What do you think is the key to manage geniuses? You give them a lot of freedom, but once in a while, remind them of what the big goal is at

the end. But truthfully, I think it is true. When you have such really great people, there is an art, not a science, to how to get the best out of them. I think we've been very successful in the sense that people are proud of the technology that they work on. They're proud of what they're able to contribute. And once in a while, we have to remind them that technology for technology's sake is not enough. them that technology for technology's sake is not enough. We actually need technology for an end user and end application, and those things are important as well. But we do have some extraordinary

people at AMD. There is a lot of talk about psychological safety these days, and we just had a conversation with Amy Edmondson. Where are you on that topic? Well, I think if you mean the opportunity to learn and make mistakes, I would say in general, we have a very learning culture. I'm a believer in you learn from everything. You actually learn more from your mistakes and you learn from your successes. That's certainly how I grew up as an engineer and as a And so as a company, we're very much a learning culture. And, and, you know, my philosophy on it is, you know, no one's ever perfect, and no company's ever perfect. But we can certainly learn from every experience. And as we do, you know, we'll do it a little bit

better the next time. So I think that's a that's a very ingrained part of our culture. Are there any particular things you do to stimulate innovation and creativity? Any secrets? better the next time. So I think that's a very ingrained part of our culture. Are there any particular things you do to stimulate innovation and creativity? Any secrets? Well, I think on the innovation and creativity side, we do do very long-term roadmap planning. For our industry and for our business, many of the decisions that you have to make, you have to make three to five years in advance. And so we actually think about, hey, what is our five-year roadmap? And how do we accomplish that five-year roadmap? And what are the key nuggets of innovation that are going to make it very differentiated and sort of leading in the industry? And that's always very stimulating. Engineers love to do that, right? It's fun to think about the future

and then make sure that we execute the present. That's very much part of our entire corporate process, actually. But is it difficult to get people to think in such a long-term time frame? Well, I would actually say it's not difficult to get people to think that way. I think it's energizing to think about the future. The difficulty is actually ensuring that we put these very long-term goals into very bite-sized chunks so that we are executing on those. That, again, has been very much part of our culture. When we started our new Zen CPUs, I mean, again, that was like a long-term effort. And we said, hey, it's going to take us five plus years to become the leader

in this space. But this is how we're going to do it step by step. And then we measure ourselves to the step by step. So your industry is now in the middle of the whole geopolitical situation. And I appreciate you've got clients all over the world, including important clients in China and so on. So I'm sure you can't be too specific. But just in general terms, how is the geopolitical situation shaping your industry now? Well, I do think it's a first order consideration. And our goal is to balance, you know, of course, you know, all of the different, you know, pieces. I mean, you know, we are a, you know, US company.

And so, you know, from that standpoint, you know, given some of the national security concerns, we're, you know, certainly very cognizant of that. On the other piece of it, you know, we do operate in very global markets, and we have, you know, a great set of partners across the world. And our employees are, frankly, all across the world. And so, you know, in this place, I think we have very much tried to have the balance between all the various constituents. And, you know, we continue to believe that that's the way to operate in this current time. You are a member of the U.S. President's what is called Council of Advisors on Science and Technology. What are the things you discuss here?

Yeah, it's a very interesting group, actually. It's a very honored to be part of the it's called PCAST for short, the President's Council. I think it's about 30 people with very, very diverse experiences. So, you know, we just actually completed a report on semiconductors in terms of the R&D sort of investments that should be made over the next, you know, five plus years. So we go from something that, you know, I know a lot about to a whole bunch of areas, including, you know, climate change, including, you know, patient safety, you know, sort of wildfires, which I wouldn't say I know as much about. But it's fascinating to think about, you know, at the end of the day, science is so, so important to helping, you know, make all of our lives better. And, you know, having diverse disciplines of people, you know,

together thinking about what are the right, you know, sort of strategic places to spend time is what PCAST is all about. And, you know, it's very much advising, you know, the president and the administration on, you know, some of the places to focus on as it relates to science and technology. I'm sure you also focus there on artificial intelligence. How do you see that field developing over the next, let's say, three years? Yeah, absolutely. So AI is everywhere. I think we're at the very beginning of what AI can do for us.

And it is still so much to be discovered. I look at AI as, again, it's an evolution of what you can do with it. And we're at the place where we're just scratching the surface of how much we can use AI technology to, again, make our lives easier, make our lives more efficient, make our companies and our enterprises more efficient, make things safer. So AI is a huge opportunity for us over the next decade. Spending some time on your management style. Now, you have an engineering background. How is that influencing your management style, you think? Well, I do say that I'm an engineer at heart. The thing about engineering that I enjoy is there is a truth, right? There is a right or wrong. A product either works or it doesn't work. And I find that very appealing. And so the most important decisions that we have as a company are around those technology directions.

And I would say I'm not practicing engineering. So the team does all the engineering work. But I get a chance to spend quite a bit of time on the engineering direction and sort of the product and the technology direction. What is your view on the gender imbalance in the technology industry? How can that be solved? Certainly, there is an imbalance. There's an imbalance in engineering overall, and there's probably a bit more of an imbalance in semiconductors. I think what we have to do is, you know, give people sort of the right opportunities. And, you know, when I look at

that, you know, we've made progress, but we've not made yet enough progress in terms of just having a more, not just gender diversity, but underrepresented minorities as well. So part of this is making the industry interesting and attractive and sort of easy to be accessible. So that starts with STEM education and then goes into once we get people into the company, giving people opportunities and sort of a career path for how to grow. But there is certainly a lot more that can be done. Both you and I have said publicly that we have our dream jobs.

And so when you sit there on a Friday afternoon, back from work and look back, what are kind of the moments in the week where you think, wow, that was amazing. I was really in the flow. I felt this moment of intense happiness. Yeah, it's an interesting question. I would say what makes this a dream job for me is a few things. One is you get to influence so much. I love the fact that the technology that we're in is in so many different applications in so many different places.

We get to partner with some of the best companies in the world. I love that fact. I love the fact that we can directly influence sort of the product and technology direction. And so, you know, some of my most fun moments, if I think about a week, you know, I love going into the lab when we get a product back for the very first time. And, you know, we call it, you know, when we power on the product, like, that's super fun, because you see, you know, the engineers and you see, you know, sort of, like their faces light up when they're working on a product for the very first time. That's a lot of fun. I love, you know, launching our products for the very first time, because, you know, again, we're showing people, you know, the product of, you know, three, four, five years of work. And frankly, you know, I love spending time with our partners, you know, who talk about, hey, these are the challenges that we face, how we can do amazing things together. So when you think about in a week, you can go through all of those things. That makes the job fun. I think I'm a person who

likes to do lots of different things that come together for a great good, which is bringing out great technology. What's the proudest moment in your life? Oh, proudest moment in my life. You know, every time we launch products, I'm extremely proud. There are always a few special ones. You know, the first time we launched our first Zen processor, I think nobody expected the type of performance that, you know, we like people just didn't believe it. And it was nice to be able to say, yeah, you know what, you should believe it. We did that. And we did a bit more. You know, I love the supercomputer that we just launched. You know, one of the fun things, I know this sounds really, really funny, but you know, you're, you're at a national lab,

and you have the fastest supercomputer in the world. And, you know, I get to sign the plate, representing AMD. I mean, those kinds of things are kind of fun. We have a lot of, well, we've got thousands of young people listening to our podcasts. What advice would you give them? Well, I got a great piece of advice when I was a very young engineer. And the piece of advice that I got was,

Lisa, you should run towards problems. I didn't really understand that piece of advice at the time, frankly. But what it really means is, look, we all are going to spend all of our waking hours working on something. Whatever you work on, make sure that you work on something that's important. And actually, people like it when you volunteer for tough problems, because that's where you need sort of the most, you know, sort of innovation, the most creativity, the most, you know, sort of opportunity. So I like to tell people to run towards problems, you know, volunteer for that hard problem.

Don't be afraid to take on something that's really challenging because you're going to learn a ton and people are going to appreciate that you've volunteered for something that was really hard. Yeah, well, you for sure have done some quite incredible things and made some huge changes to the world. So it's been a true honor speaking with you. All the best of luck going forward. And I'd love to come and see that pseudo-computer at some stage. I would love to show it to you, Nikolaj. Thank you so much. It was great spending some time with you.

Fantastic. Thank you so much.