Archive for January 11th, 2007

What needs to change for India to create more product companies?

January 11, 2007

With IT services companies (Infosys, Satyam, TCS, Wipro) being phenomenally successful, there is an urge amongst many of us to see similar success in product companies, particularly the semiconductor and electronics manufacturing area – the focus of VLSI 2007 conference.

Veerappan of Tessolve set the stage for the panel discussion.

Pradeep Vajram (VP Engg, QualComm) talked of three issues

    Companies to focus on depth, take risks and use the “network” – characteristics of Silicon Valley companies
    Need for networking among industry professionals
    Education & Research institutions and industry should work closely; about 25% of Institute revenues coming from Industry is one good indication

Ganapathi Subramaniam (CEO Cosmic Circuits) talked about four issues

    Ecosystem to engage all partners
    Talent to be available I the areas of finance & marketing, design and operations; currently no operation experience is available in India and may be we need to import this talent
    Infrastructure (particularly logistics) to support manufacture
    VC funding that understands the complexity of semiconductor, electronics and manufacturing

Samir Kumar (Managing Partner, Investus Capital) talked of five issues

    Capital to be available in a way very different from services companies (not Banking type but entrepreneurs controlling VC funds)
    Risk taking amongst people and the society supporting
    Skill-sets to match the requirements
    Market to absorb (luckily it is happening in India)
    Role models for success in manufacturing (the way Infosys for services companies)

I mentioned about the lack of people with advanced degrees (M Tech / PhD) – comparing USA (75,000 BS while 15,000 PhD in Science & Engineering) Vs India (3,75,000 B Tech but just 1,000 PhDs in Engineering), influence of parents, society putting value in “number of people reporting into you” than the “contributions by you as an individual” as impediments

There were some interesting questions from the audience. There was a feeling that in the next 3 years there will be some role models and success stories through products from India.

(Panel discussion on January 10, 2007 during VLSI 2007 International Conference at NIMHANS Convention Center, Bangalore)