Pursuant to a congressional request, GAO assessed the progress of a consortium of U.S. semiconductor and computer companies (SEMATECH) formed to conduct research and development that will provide the U.S. industry with the domestic capability for world leadership in manufacturing, focusing on: (1) the Department of Defense's (DOD) participation and role; (2) the consortium's approaches and organization for achieving its overall objectives; and (3) initial technology transfer activities.

GAO found that: (1) the consortium and DOD were satisfied with the Defense Advanced Research Projects Agency's (DARPA) oversight, citing DARPA improvement of the consortium's strategic planning efforts; (2) although 1987 authorizing legislation for continued DOD participation required the establishment of an advisory council, DOD had not forwarded the names of industry members for presidential appointment; (3) other industries and the Congressional Budget Office proposed the consortium as a model for other government-industry consortia; (4) the consortium's 1990 operating plans revised equipment and material development milestones for its technology achievement goal and established intermediate goals and milestones that will still enable U.S. industry to regain world leadership; (5) the consortium reduced its scope for technology replication so that it could concentrate on tasks it needed to achieve parity with the Japanese industry; (6) the consortium reorganized its operating divisions around project teams, whose members had different experience and expertise, to better advance processes and equipment technology; (7) 181 member-company employees filled consortium management and engineering positions as of September 1989, typically for 2-year assignments; and (8) six member companies planned to replicate transferred technology.