Mentor Graphics Etching EDA Leadership in India Date:   Sunday , January 31, 2010 On a sunny day in March 2008, Hanns Windele, Vice President, Europe & India of Mentor Graphics woke up in his Munich residence to read "Ford says Tata to Jaguar" as the front-page headline in a British daily. Tata Motors had announced its entry into the international luxury car market as the company snapped up two of Britain's most famous names in the automobile industry, Jaguar and Land Rover, in a $2.3 billion deal with Ford, their American owner. Windele was quick to sense the eagerness of Indian automakers to lay hands on high-end auto technology not only to produce cars for the developed world but also to adopt this technology for the domestic cars in India. The good news for Windele was that the design managers for Jaguar and Land Rover were extensively using Mentor Graphics tools for simulation of the vehicle's electrical design process, including that of the wire harness. Even on the embedded side, JLR was using Volcano, a company acquired by Mentor. In fact, all design process improvements by auto OEMs across the world are through Mentor’s solutions. With Mentor's strength in the auto design space, it is not a difficult task for Windele to convince the Indian automakers of the value of his products which provide top to bottom solution for auto design, one that integrates system modeling and prototyping, networking, module design and analysis, electrical distribution and PCB design. By focussing on the growing auto industry in Europe in the last decade, Windele had steered Mentor to a commanding position in the continent. Now, he hopes to replicate this success in India, though he is cautious while laying his strategies for India. His understanding of the dynamics of the Indian market is evident when he says, sitting in his Munich Office, fully wrapped to take on shivering -10degree temperature. As he maps the Indian market landscape one wonders if he is based in India or Munich, Germany, “A cut-paste of all strategies which ensured our leadership in Europe will not hold good in India as both the countries have different industry presence with diverse growth arenas.” The Right Bet As per a KPMG study, over the next five years, India is expected to jump to the seventh spot in the global automotive market share from its current ranking as the 11th largest passenger car market. It is not just about cars; India is also the world’s second largest two-wheeler market and fourth largest commercial vehicle market. “Unlike other markets, the automotive sector in India is at a different growth curve and we can expect good returns by staying focussed,” says Windele. The Director of Sales for Mentor Graphics, India, Raghu Panicker has been busy crisscrossing the country knocking on the doors of automotive OEMs. “What we see is that there is a mismatch in the way global automotive OEMs design vis-à-vis Indian auto OEMs. What’s clearly lacking here is a well-defined design methodology. For instance, the way libraries are created and the way the databases are formed for reuse of those libraries, do not comply with any defined standards thereby giving room for inefficiencies. We are working with some of them [Indian auto OEMs] for the last two years. Today, we are taking our relationship to the next level of engagement,” notes Panicker, who is confident of catching up with the demand through the company’s extended range of automotive solutions in the shape of tools for design and analysis of the electrical distribution system and its associated harnesses for embedded system/software and for in-vehicle network design. Serving the Designers: Expanding Relationships to Embedded Space Others on the list of Mentor’s interests are the semiconductor design, embedded software and embedded system design companies. With the growing need for high-speed, advanced design technologies and globalization, companies in India’s electronics industry need to improve their design and analysis capabilities, upgrading from outdated design tools to solutions that meet scalable needs. With many products designed in India by both multinational companies and Indian companies, Windele sees a strong appetite for Mentor’s product suite. "We are witnessing a significant increase in revenues for our design tools," says Windele. For instance, earlier this year, the Canon India design centre chose the Mentor’s Questa advanced verification platform, combined with the Open Verification Methodology, to ensure the highest level of modularity, productivity and reuse for the verification of Canon India's complex and highly compute-intensive integrated circuit (IC) designs. Many MNC OEMs like Canon are leveraging Indian talent to do system-level design from India. These engineers are now playing a key role in system design, for both the Indian and world markets. As they are designing complex electronic systems in India, they will need local support from semiconductor companies like Mentor. Several multinational companies like Texas Instruments, Freescale, Intel, STMicroelectronics, Qualcomm, AMD, Broadcom and Cypress are executing full chip design or end-to-end solutions from their India centers. With all these companies using Mentor’s tools in one form or the other, it becomes very important that there is technical assistance when required. So Mentor Graphics India has set-up a strong support team to meet the needs of such design centers. India-based companies like Wipro, HCL, Mindtree and Open Silicon, which offer design services to OEMs and MNCs, are also on Mentor’s radar. The interesting trend that he notices is of late many of these design houses are engaging with their customers in defining the architecture of the product. It only means that the company can hope that these design houses will leverage Mentor technologies to reap further success in the near future. Some of these firms also offer product-engineering services by designing end-systems or developing IPs for their customers. They use Mentor’s functional verification platform, which has helped in getting successful results quickly in real projects. Mentor is now expanding its EDA product suite by providing a complete embedded software solution for the development of devices with embedded systems. With this, Panicker and his team are hoping to gain an edge in the marketplace by expanding the existing relationships with customers. “We thrive in the industry on the basis of our relationships,” he says, “What is important in the India context is the value proposition, along with the pricing.” One of the charters that Panicker has for 2010 is to build & extend relationships with companies like Reliance, Onida, Videocon, Mahindra and Tata and engage with their design groups. “We strongly believe that our solutions are essential for these companies to bring out systems faster to market,” notes Panicker. Apart from directly reaching out to potential customers, Mentor also has a distribution model where it partners with other firms to market and sell its products as well as support customers across the country. Partners like CG-CoreEl and Trident Techlabs distribute the complete range of EDA products from Mentor Graphics in the Indian market. Through the partners Mentor Graphics’s products even reach the defense establishments of the country like ISRO, DRDO, LRDE, ADE and BEL. Apart from all this, Mentor Graphics has formed strategic alliances with companies to address the technological challenges that the industry faces or will face in the next couple of years. “System Verilog and OVM are evolving as the mainstream verification trends and design companies are challenged in the SystemVerilog/OVM verification IP space. To address this challenge, we partner with some of the services companies like Wipro, HCL, MindTree, eInfochips, Tata Elxsi and KPIT-Cummins in a program called Questa Vanguard Program (QVP) to co-innovate, research and develop industry-ready IPs in the System Verilog space”, explains Panicker. “As a result of this effort we do have a sizeable amount of verification IP in several domains,” he adds. The same applies to the analog-mixed signal space. Mentor works with India-based companies like Sonic Chip and Cosmic circuits to develop, license and market analog and mixed signal Semiconductor IP cores for use on System-on-Chips. Helping Electronic Design Start-ups Achieve Lasting Success Windele’s long-term vision(Which we call the ‘WIN’dele phenomenon)—that of making Mentor Graphics the number one EDA player in India—involves working with start-ups. The startup ecosystem is on a rapid surge in the Indian context and Mentor’s concentration on it is a part of their growth strategy. For this EDA leader, startups are the key customers as around 30 percent of its bookings globally are from these budding firms. In India, there is a new wave of ambitious entrepreneurs with a lot of great ideas and initiatives who have worked for multinational companies and now started their own ventures. Supporting these startups is essential. Funding or venture capital in this segment is not as strong as it deserves to be. Mentor’s “Cre8Ventures” programme, which has seen success in other regions, not only gives start-ups access to technology and tools but more importantly access to customers. “Providing tools is easy. It is something many companies can do,” observes Windele. Through “Cre8Ventures”, Mentor concentrates on providing start-ups access to its own customer base, and since almost every large electronics company is its customer, this base is huge. The programme also brings together experts from the technology as well as the financial side; this pool then interacts with entrepreneurs and advises them based on their own experience. Cre8Ventures has been put in place to address the fact that an unacceptable level of business opportunities fail in hi-tech electronics, even though the ideas are world class, and turning ideas into successful businesses has a low conversion ratio in hi-tech electronics historically. Part of the problem is that people with great ideas and good businessmen are not necessarily the same or connected, and there are too many barriers that prevent entrepreneurs from accessing the right business infrastructure support. This includes access to finance, where 90 percent of VC money goes to people they already know, and validating the business idea in the marketplace is difficult. Cre8Ventures aims to put entrepreneurs in touch with the right people for funding, market analysis and development and tools. It will put entrepreneurs in touch with the key people, and guide and support them through the business development life cycle to enable a revenue stream. It will also provide early access to Mentor’s latest design flows through incubation and technical fostering and use Mentor’s scalable business models for the success of start-ups from the early stages. India is still in a nascent stage as far as encouraging the leadership with capital help is concerned and Mentor expects to fill the gap, a move that ensures a better mind-share with young firms. Getting to the Top With its design centers, support team, partners, excellent marketing mechanism, linkages with academia and active sales team, Mentor is doing the right things to help the ecosystem grow. Having identified the growth markets in the Indian landscape—automotive, embedded design and startups, and resolving to stay focussed, the challenge for Mentor in India is to get its execution right. If it does, we can soon see it being the No.1 EDA player in India.