Closing India's Innovation Gap: Re-igniting the Spark of Creativity in a Consumption Economy Date:   Monday , January 02, 2012 Innovation is finding something which is of value to our society. It can be done by research that solves an unknown problem and hence changes the method one might have previously perceived. Throughout industrialization, innovation has been the life to development of products that standardized and improved the conditions of living. These products of innovation could vary from the development of the internet to much simpler yet useful products like a Mach3 Razor. These products have changed the way we live and operate one way or the other. India has been in the forefront of innovation for a long time now and is witnessing fundamental changes in the industrial setup. India, especially in the electronics sector has seen tremendous changes. For example, the semiconductor industry is booming and flourishing the world markets. It is important for us to recognize and work through this industry in order to keep this strong image going. World leaders have immense confidence and have given us enough insight into the semi conductor market as to where the real potential lies and what needs to be done to augment this reality. The thought that comes to our minds is that when we have such a large proportion of imports, what are the trends that will address this perceived innovation gap. A lot of innovation happens at the interface with the consumers. Few people, who have been in the industry for over a decade debate saying an innovation made for the new market, try to define conventional wisdom we could reserve as a next step. “The question is, how we launch it in the market and at what price points we do it. And also continue to match the price erosion that is driven from China and Korea,” asks Vinay Shenoy, MD for Infineon Technologies. Is it impossible? Definitely not, as we have the same set of people where the supply chain of people is predominantly located. Innovation is a national phenomenon because we cannot have a few individuals to close the gap. It has to be priority for the country. A Draft policy called the National Electronics Policy was recently announced and this draft facilitates setting up of Semiconductor Wafer Fabs and its eco-system for design and fabrication of chips and chip components. It also provides market access for domestically manufactured electronic products including mobile devices, SIM cards with improved features which have special emphasis on Indian products for which IPR reside in India. This could in turn address strategic and security concerns of the government consistent with international commitments. The draft reported that it proposes to achieve a turnover of $400 billion by 2020 in the electronic system design and manufacturing sector. This would also involve employment of around 28 million people at various levels. In order to achieve this kind of development, we need to take these small initiatives and work on developing the skills, engaging with local requirements through the innovation, we can achieve quite a bit. “It is important to make sure that innovation is creating a commercially successful business for which we need to identify some of the verticals and focuses on creating the complete solution rather than solving just a small portion of the puzzle,” said Guru Ganesan, MD, ARM India Operations. Hence, we need to have a complete ecosystem to create and ensure that it is an automated electronics industry only then we would be able to see a complete solution in that sector rather than that small segment. The determination of these verticals need not be all done at the same time but instead we can eventually make it happen. Product Innovation: Aspects and Effects “We need to manufacture a product that is world class and different. In terms of how the ecosystem is evolving, a lot of things have changed in the last few years,” Sanjay Nayak, Founder, Tejas Network. The first aspect of product innovation would be the Standardization. Here, we always need to do something new and leave the old ones to a side. There are always new standards coming out. The use pattern in various countries is different from each other. The purpose of few technologies used in these countries will be different from what is being used in India. The set of optimization, the algorithms, the way at which the hardware and software are being tweaked and what kinds of patterns are being used in India, are going to be very different to other countries. The next aspect is the determination of cost points. This has a tremendous scope for innovation. The cost points in the U.S. and Europe could be different from the cost patterns in India. So, when the cost point comes to picture there is a different play for innovation all together. The other aspect where India has an advantage is the ecosystem Indian industries have. What we really need to do is to leverage the "tool kits" which is the semi conductor technology like the latest standards and the software and group it all together and come out with disruptive cost points and feature sets based on the use patterns. So, once when products are made from all these four aspects it is not only good for India but also for at least 50 percent of the world which is like India, e.g., Africa, Eastern Europe, brazil and all the other developing nations. They all face similar challenges in terms of cost points and use patterns. The customer and the talent both being available in India, all we have to seek for is the government support and proactive steps in doing something about these aspects mentioned above. Lessons from the Older Generation “The 1980's design group had very innovative people. They carried out the specifications of the products that were defined in other places in the world and have done it quite well. These design groups have now become well respected companies among the MNCs who are looking up to for the innovative execution of products,” mentioned Walden Rhines, CEO, Mentor Graphics. This is where the engineers come into picture to put things together. This could happen in two ways - the rapid growth of the market in India where there is ample opportunity for innovation and the other way is when the engineers in the design group travel around the world and pair these capabilities for needs of the population of places outside India too. This is quite a natural evolution as we have the right resources and skilled people. Despite having skills and talents for the same, where are we falling behind? When we look at a product at a bigger scale, what is it that we usually look for? What can the industry leaders do in order to supplement or reduce this gap of innovation? This is considered to be a very multi-dimensional problem in India. The rate of growth of innovation is claimed to be slower compared to other developing countries. To improve all these things, there are few aspects we can improve. It is the confidence of the employees and the product innovators. We need the confidence to say "this is the product that will change the world tomorrow." Each generation has evolved in a big scale in terms of the number of innovations. The people in the 1950's to the 80's basically set up the infrastructure. The 1980's to 2000 could see a few glimpses of successful entrepreneurs in India. The present generation is very passionate about their dreams with extremely high levels of confidence. We are now seeing a lot of new startups coming up and making tremendous changes in the ecosystem. Development of the Ecosystem “The culture, mindset and attitude of people here are different. India is not an early adapting society. We start accepting innovations later than many countries which have similar disruptive technologies. We are not an experimental type where we try to use an early technology before its maturity,” says Vinod Deshmukh, President (Technology and Products) for MindTree. This makes it difficult for the innovator to bring out new technologies for us to experiment. The ecosystem needs to be built in such a way that both the talent pool and the mindset of the people be enhanced for the better. The industries need to start accepting and respecting the products developed by our colleagues. The media also can play a big hand in terms what they can do to change by providing lot of space for the startups through projecting them highlighting what these industries are actually trying to do. These startup companies need not always compete with the mature products; they could rather take media's help in getting recognized. A lot of these innovations in the applications domain have proved that we are quite innovative people and this need to be carried on for the future generation as well. This next generation also will do a similar level of innovation at a global scale. To conclude, “When exposure to system level design happens, that is when we see an opportunity for innovation to occur”, said Santhanakrishnan Raman, MD, India, LSI. So, as India's consumption grows, more and more companies see the opportunities to design and make products closing these innovation gaps will be closed. We need to look at businesses which can grow at higher margins and these are sectors that will have the ability to take risks in terms of encouraging the new technology. When it comes to the consumer part of it, it is the mindset of the people we often look for a mature type of products. We can see a lot of things changing in our industrial set up and these serve us as a positive outlook for the future that is ahead of us. Therefore, innovation is a culture and it needs to be inculcated right from the early stages of the life in the form of education. Based on the panel discussion at Siliconindia Mentor Graphics Leadership Summit Awards. Award Winners • Best VLSI/ Embedded Design: Automotive: TATA Motors • Best VLSI/ Embedded Design: Medical:Philips Innovation Campus (PIC), Bangalore • Best VLSI/ Embedded Design: Industrial: Honeywell Technology Solutions – India • Best VLSI/ Embedded Design Consumer Electronics:Samsung Electronics India Software Operations (SISO) • Best VLSI/ Embedded Design Defence/Aerospace: Advanced Numerical Research & Analysis Group (ANURAG) - DRDO • Best VLSI/ Embedded Design Telecom/Networking: Qualcomm India - Bangalore R&D Centre • Best Electronic System Design Company -MNC: STMicroelectronics India • Best Electronic System Design Company - Established Indian Company: HCL Technologies • Best Electronic System Design Company - Startup: Open Silicon • Award for Youngest Entrepreneur in Semiconductor space: Gani SubramaniamCo-Founder & CEO, Cosmic Circuits Balaji Kanigicherla, Founder & CEO, Ineda Systems • Outstanding Contribution to VLSI/ Embedded Design Industry - Corporate: Wipro Technologies • Outstanding Contribution to VLSI/ Embedded Design Industry - academic institution: SASTRA University (The Shanmugha Arts, Science, Technology & Research Academy), Thanjavur, Tamilnadu • Outstanding Contribution to VLSI/ Embedded Design Industry - Individual: Dasaradha R Gude ("GD"), Founder & Chairman, SoCtronics Technologies Venkat Mattela, Chairman & CEO, Redpine Signals Shiva Gowni, Vice President, R&D Site Leader, AMD India Sanjay Nayak, CEO & Managing Director, Tejas Networks Daaman Hejmadi, VP of Engineering, Qualcomm. Dr. M.J. Zarabi, Co-founder & Chairman, Masamb Electronics Systems Vasantha Erraguntla, Technology Director, Intel India