Elected in 1982
“For outstanding innovation and engineering of digital-computer-controlled, private-branch telephone systems.”
M. KENNETH OSHMAN, a Silicon Valley icon, died on August 6, 2011, at the age of 71 from complications of lung cancer.
He was an original Silicon Valley entrepreneur whose personal vision and passion created not one but two industry-leading companies that developed revolutionary technologies. One, ROLM Corporation, paved the way for today’s voice communication technology, and the second, Echelon, is a major player in control networks and the smart grid. Ken was a brilliant leader who served as an inspiration to everyone around him, and he created a culture where hard work and collaboration just came naturally.
Commenting on his impact on Silicon Valley, the New York Times wrote: “With a gentle, understated style, Mr. Oshman stood apart from other well-known leaders in Silicon Valley, many of whom were seen as capricious and even tyrannical. He was a mentor to a generation of Silicon Valley technologists and able to inspire a kind of loyalty in his employees not frequently seen in high-tech industries.”
Ken was born in Kansas City, Missouri, on July 9, 1940, but grew up in the small community of Rosenberg, Texas, just outside Houston. Rosenberg was home to a close-knit Jewish community, and Ken attributed much of his business acumen
to lessons learned from his uncle, Milton Robinowitz, a larger-than-life cowboy and rancher who gave Ken the opportunity to learn the cotton-trading business as a teenager.
Ken was at the top of his class as an engineering student at Rice University, where he earned a BA in 1962, summa cum laude, and a BS in electrical engineering in 1963. He married his high school sweetheart, Barbara Daily, in 1962. He was accepted into the Harvard MBA program, but was recruited instead to move to California to work for Sylvania Electronic Products in the brand new field of lasers.
He worked as a member of Sylvania’s technical staff from 1963 to 1969 while earning an MS EE (1965) and a PhD EE (1968) from Stanford. His dissertation advisor, Steve Harris, described Ken as a brilliant off-the-charts student and, at the same time, a kind and gracious human being.
Ken’s PhD dissertation was entitled “Studies of Optical Frequency Parametric Oscillation” and was completed in the exceptionally short time of two years (October 1965–December 1967). The major contribution of this work was the first observation of what is now termed optical parametric fluorescence or parametric down conversion. Ken’s paper was published just four months ahead of comparable work at Moscow State University. Over the years parametric fluorescence has become the near-standard light source for experiments with entangled photons, Bell inequalities, and quantum information. In 201l alone, more than 40 years after it was published, Ken’s paper was cited 11 times.
In 1969, Ken cofounded ROLM Corporation with three partners: Walter Loewenstern, Robert Maxfield, and Gene Richeson. All four had undergraduate degrees in EE from Rice and EE graduate degrees from Stanford. ROLM’s initial business was making rugged “milspec” minicomputers for military applications. Within three years the company had built a highly profitable business bringing an “off-the-shelf” standard product approach to a defense industry accustomed to designing new computers from scratch for each new application.
But Ken was concerned that the market was not large enough to build a major company, and he pushed his team to identify new market opportunities in the commercial sector for computer technology. The decision was made to enter the telecommunications market by pioneering the application of digital switching and computer control to PBXs (private branch exchanges—corporate telephone switching systems). In this market, the primary competitor would be AT&T, then the largest corporation in the world. Needless to say, many people, including some of ROLM’s venture capital backers, believed the management team had gone mad.
When the ROLM CBX (computerized branch exchange) came to market in 1975, ROLM had annual revenues of about $6 million in its milspec computer business and about 100 employees. Within five years the company’s annual telecommunications revenues were well over $100 million and it was one of the top three players in the PBX market. ROLM’s many innovations to modern voice systems included integrated voice messaging, digital telephones, and integrated voice-data terminals.
Although ROLM was a great business success, its chief contributions to the evolution of Silicon Valley were cultural. Under Ken’s leadership, the management team created the best example of an emerging Silicon Valley management style that effectively broke down the barrier between work and play. The philosophy was that by focusing on making the company a great place to work (known to all as “GPW”), the company would be able to recruit the best and brightest employees. Examples of its innovations include a company-paid three-month sabbatical for every employee after six years, cash profit sharing for all employees, and an on-site recreation center with a pool, racquetball courts, exercise rooms, and other amenities. Variations of these pathbreaking innovations are now widely incorporated in Silicon Valley culture.
Ken was a charismatic leader who was intensely loyal to his employees and treated them as extended family, and they reciprocated. He inspired everyone with his unfailing
optimism and great sense of humor, especially when times were tough.
In 1984 ROLM was acquired by IBM at a valuation of $1.8 billion. Ken Oshman became a vice president at IBM and a member of its corporate management board until he left in 1986.
In 1988 Ken joined forces with A.C. (Mike) Markkula, an early Apple investor, to build Echelon, a control networking company that pioneered peer-to-peer networking of devices, such as thermostats and lights, using a tiny programmable control chip called the Neuron. He served as Echelon’s CEO and chairman until 2009, when he became executive chairman. To date over 100 million devices have been installed with this technology in many applications, most notably in recent years as a critical component in the “smart grid,” enabling energy-efficient systems for utilities, business, and homes. And of course Echelon is known as a great place to work.
In spite of the demands of being CEO of high-tech companies, Ken made time for numerous leadership roles in the community and industry. He served as president of the board of the Stanford Alumni Association and was a member of the Advisory Council of the Stanford Graduate School of Business, the Stanford Associates, and the board of directors of the Community Foundation of Santa Clara County. He was an American Electronics Association director for five years, serving as its chairman in 1977; a director and chairman of the Santa Clara County Manufacturing Group; and a member of President Reagan’s Economic Policy Planning Committee and the Committee to Advise the President on High-Temperature Superconductivity. He served on Rice University’s board of governors from 1984 to 1988 and its board of trustees since 2004. He lent his business expertise on the boards of Sun Microsystems, Knight Ridder, ASK Corporation, StrataCom Inc., Charles Schwab Corporation, and Just Answer, among others.
Ken Oshman was elected to the National Academy of Engineering in 1982. He was a recipient of Rice University’s Distinguished Alumnus Award in 1984 and the Rice Out-
standing Engineering Alumnus Award in 1993. He was a member of Phi Beta Kappa, Tau Beta Pi, Sigma Xi, and Sigma Tau honorary societies.
He was an extremely generous philanthropist, supporting a wide range of worthwhile causes. He endowed engineering chairs at both Stanford and Rice and made the lead gift to establish the Oshman Engineering Design Kitchen at Rice, a state-of-the-art design facility that enables students to realize their required design projects through cross-disciplinary collaboration and cross-technology training. His family foundation was the lead donor in a campaign to build Palo Alto’s new Jewish Community Center, which opened in 2009 and was named in the family’s honor.
Ken enjoyed golf, opera, good cigars, fine wine, and spending time in Hawaii.
Even with all of his professional accomplishments, Ken felt the most important thing in life was his family, whom he loved dearly. He is survived by his wife of 49 years, Barbara, his sons Peter and David, their wives, and four grandchildren.