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Vishwanath Kulkarni

Companies in the electronic design or e-design space need to collaborate to make the most of outsourcing opportunities. It's getting the dynamics of moving together right.

INDIAN IT companies operating in the electronic design (e-design) space are now chanting the collaboration mantra to tap the outsourcing opportunity that's set to expand in the coming years.

This is because the next generation design requirements are expected to be totally outsourced as design-less production houses are coming into existence.

Increasing design costs in today's market environment are forcing these production houses to take the outsourcing route.

Indian companies have already made a dent in the global e-design space in the short term.

The industry is now, however, talking about capitalising on the opportunity in the medium term by focussing on intellectual property (IP) and enhancing collaboration in the industry.

At the same time, in a bid to leverage cost-effectiveness and the huge talent pool in India, multinationals that have already set up their bases are expanding.

Creating design eco-system

"The outsourced design space provides a huge opportunity for Indian infotech companies to grow and move up the value chain" says Sridhar Mitta, Managing Director, e4e Labs.

With an IP-oriented focus, the IT industry should explore the possibilities of forming clusters of design companies, which, in turn, will create an eco-system.

"There is a need for creating a design eco-system, and enhancing collaboration among companies in the e-design space is the best way to do that," says P. Sridhar, Managing Director, ControlNet India, a subsidiary of ControlNet Inc. "A design eco-system is a must to make India a global destination for e-design," he says.

"India can become the IP capital of the world, provided the industry collaborates extensively," says Sridhar.

There is not only a need to set up linkages with the academia, but also within the industry itself. "However, we need a service differentiation to enter the IP-oriented domain and create the IP-based business models," he says.

As the first step in creating a design eco-system, an IP-Exchange Forum is being planned in Bangalore.

This will tackle the issues faced by the industry and also promote India as a destination for IPs. It will also act as an aggregator for the buyers and sellers of IPs. The Exchange is expected to deal with `interoperability' issues, avoid overlaps apart from helping companies in legal matters and contractual agreements. It will also enhance collaboration among the SMEs. It is estimated that about 200 companies in India are involved in IP creation and a majority of them operate in the e-design space. Major names include Wipro, Sasken and MindTree Consulting.

Agreeing on the need for a design ecosystem, Himanshu Singh, Country Manager, Cadence India, a vendor of electronic design automation tools, says, "One is actually seeing certain focus on IP creation and services around IPs to develop vertical expertise. While the US companies are thinking of outsourcing their entire design needs, the need of the hour is to offer consolidated end-to-end services." The MNCs operating in India are moving in that direction, he says. "Indian companies need to equip themselves to tap the outsourcing market by taking over complete designs. Collaboration is needed to take over the total design space of the world," says P. Sridhar.

"We are well-positioned to enhance our offering beyond services to IPs and products," says S. Janakiraman, President, Technology Business, MindTree Consulting.

While the road ahead is clear and visible for the Indian design industry, what can create a difference while moving ahead is the willingness among the companies to collaborate even while competing with each other.

vishwa@thehindu.co.in

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