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Despite the disadvantages of limited research resources and little influence over the global electronic market, Taiwan is able to build from scratch an IC manufacturing industry that is now the fourth in the world in terms of total revenue. The manufacturing performance of Taiwan’s IC industry significantly resides in low cost and quick delivery. This raises an important question: why Taiwan is able to achieve such manufacturing excellence in the IC industry. Proactive practices adopted by Taiwan’s IC manufacturing industry are considered as a competitive weapon. The purpose of this study is to identify the proactive practices in relation to manufacturing performance based on a multiple case study. Furthermore, government policy, vertical disintegration, industrial clusters, foreign provider supports and technology manpower are the industrial factors that enhance the manufacturing advantage. Finally, the industry weaknesses and future challenges of the IC manufacturing industry are presented.