THE CEOs OF HSINCHU SCIENCE PARK

Hsinchu Science Park (HSP) is Taiwan's high-tech center. Its 400 technology companies accounted for 10% of Taiwan's gross domestic product in 2007 when we undertook this study of the education and prior work experience of 385 high-tech company CEOs in the HSP. In November 2007, the San Jose Mercury News surveyed the educational background of the CEOs from the top 150 public companies in California's Silicon Valley. We compared data from the two surveys to demonstrate any similarities or differences between the two high-tech business clusters on both sides of the Pacific Ocean. Educational Background and Work Experience The number of CEOs holding graduate degrees in the HSP and in Silicon Valley were close-65% in Silicon Valley and 71% in the HSP. Apparently, graduate degrees constitute the backbone of the high-tech CEOs in the two clusters. However, 28% of CEOs in the HSP held Ph.Ds vs. only 14% in Silicon Valley. Among the HSP CEOs with graduate degrees, 38% obtained those degrees from foreign universities, mostly in the United States. But only 17% of Silicon Valley CEOs obtained their technical education abroad. In regard to work experience, 34% of HSP CEOs had prior work experience with foreign companies, most of them being multinational corporations in the United States. A reasonable explanation is that with the U.S. leading in many industrial technologies, there is little incentive for the American CEOs to acquire technological knowledge by studying abroad. Sixty percent of the HSP CEOs are alumni from one of the top four universities in Taiwan, while 25% of Silicon Valley CEOs earned their undergraduate or graduate degrees from California universities, with 20% earning their degrees in the Bay area, e.g. Stanford and Cal Tech. Thirty-one percent of the HSP CEOs graduated from the two universities in Hsinchu. This is similar to the fact that 20% of the 150 Silicon Valley CEOs were alumni of either Stanford or Cal Tech. The advantage of universities in the proximity of science parks is that they provide the faculty and students more opportunities to cooperate with local high-tech companies. Seventy-three percent of HSP CEOs are in engineering or computer science, with 55% specifically in electrical engineering, due mostly to the HSP companies' affiliation with the integrated-circuit, personal computer/peripherals, consumer electronics, and telecommuni cations industries. Only 10% of the degrees are from non-technical disciplines. This shows that most of the high-tech companies in the HSP are R&D- and manufacturing-oriented. Sixty percent of the degrees earned by the Silicon Valley CEOs are in engineering or computer science, with 36% in electrical engineering. Approximately 25% of the degrees are in business-related disciplines. The higher percentage of Silicon Valley CEOs with business degrees compared to those in the HSP may be attributed to the fact that the San Jose Mercury News surveyed only public companies, which expect greater business management capability from their CEOs. This shows that the companies in the two high-tech clusters have a similar concentration in electrical engineering and computer science. Impact on Company Performance In order to study the impact of the HSP CEOs' educational background and work experience on the performance of their companies, we narrowed down the study subjects from the 385 original companies to the 115 that were either listed on the Taiwan TAIEX or Over-the- Counter stock markets. Among the CEOs of those public companies, 48% hold master's degrees, 28% hold doctoral degrees, 44% hold graduate degrees from foreign universities, 34% have prior work experience with foreign companies, and 70% are alumni from one of the four leading universities in Taiwan. Among the 115 listed HSP companies, those that were led by CEOs with doctoral degrees had the highest total paid-in capital. The average revenue, the average operating income, and the average year-over-year operating income growth rate of the public companies in the HSP led by CEOs with doctoral degrees were also the highest. …