Sandisk Malaysia: Asia’s First Sustainability Lighthouse in Semiconductor Manufacturing

Set in 2025, this case study follows Sandisk Malaysia's transformation into one of the world's leading semiconductor manufacturing facilities. Based on Asia's first World Economic Forum Sustainability Lighthouse in semiconductor manufacturing, the case examines how the company leveraged artificial intelligence, the Internet of Things, robotics, and automation to enhance operational performance while reducing environmental impact. Led by Bock Kim Lee, Senior Vice President for Global Backend Operations at Sandisk Storage Malaysia, the Batu Kawan factory in Penang underwent a six-year journey to achieve “lights-out” manufacturing. It is a facility with highly automated production that required minimal human presence and lights, except for remote monitoring by operators in the command centre and the occasional troubleshooting and maintenance of critical or complex issues by technicians. The transformation that began in 2015 accelerated upon Bock’s return to Malaysia in 2018 to spearhead the factory’s automation. With nearly two decades of experience in semiconductor manufacturing, he had successfully implemented lights-out capabilities at Sandisk’s facility in Shanghai, China. His strategy emphasised high-ROI (return on investment) process automation, followed by holistic system integration, resulting in seamless end-to-end connectivity across the factory. This enabled Sandisk to maintain uninterrupted production during the COVID-19 pandemic while competitors struggled. By 2021, the benefits of the transformation were remarkable—a 32% reduction in operational costs and a 50% decrease in inventory and lead times. That year, the World Economic Forum named the factory as Malaysia’s first Fourth Industry Revolution (4IR) Lighthouse, followed by Asia’s first Sustainability Lighthouse in 2022. Having achieved remarkable success in lights-out manufacturing and sustainability, how could Sandisk chart the next phase of its Factory of the Future transformation? This case teaches students to identify operational challenges and apply basic operations management concepts to evaluate why they became critical as demand grew. They will learn to explain lights-out manufacturing and assess its operational impact. In addition, they analyse sustainability challenges in semiconductor manufacturing, distill lessons from Sandisk’s transformation, and develop strategic priorities for a company transitioning to ‘Factory of the Future’. Inspection copies and teaching notes are available for university faculty. To receive an inspection copy and teaching note, please email cmpshop@smu.edu.sg with your registered faculty email ID and a link to your contact information on the faculty directory at your university as verification. An inspection copy and teaching note will then be sent to your faculty email account. Download information SMU Faculty/Staff can download the case & teaching note on iNet with your SMU login ID & Password via the following links: · The Case (SMU-26-0014) · Teaching Note (SMU-26-0014TN) For purchase of the case and supplementary materials via The Case Centre, please access the following links: · The Case (SMU-26-0014) · Teaching Note (SMU-26-0014) For purchase of the case and supplementary materials via Harvard Business Publishing, please access the following links: · The Case (SMU-26-0014) · Teaching Note (SMU-26-0014)