Winning on points

Winning on pointsRoy Rubenstein caught up with the senior vice-president of Cadence Bob Leach at Nepcon Bob Leach is a man fond of statistics. The senior v-p at US firm Cadence Design Systems flags up the more important ones by shouting ‘Data point’. “By 2000 the electronics industry, at $1,100bn, will be the largest sector in the world,” says Leach. The semiconductor segment is growing at an even faster rate. “Data point – $220bn will be spent on semiconductor production capacity between now and 2000. Just 20 per cent of that is for known product,” he adds. It is this wealth of unspecified ICproduct that most excites Cadence. Its goal is to become the world’s leading ‘product realisation’ company, working with other firms to turn their designs into silicon. To achieve this Cadence must offer design services across the world, operating around the clock. “You can’t just do it where it’s convenient,” says Leach. Securing sufficient designers to fuel such a global operation is something that has preoccupied Leach in the last year. He shared his experiences at the recently held Nepcon Economist Electronics Conference in his talk on succeeding in the global marketplace: “Not in terms of selling but how to succeed in new markets for extremely smart people,” says Leach. Leach highlights the two philosophies – ‘exploit’ and ‘develop’ – used to gain talented designers. “In Silicon Valley poaching [exploiting] is used but all the players lose in the end.” Developing new talent is obviously harder: “We [Cadence] are now forced to add 6,000 people in the next three years. It goes without saying that incremental hiring is not going to do it.” When looking at other countries for engineering talent, several key requirements are necessary, argues Leach: an education system “capable of sustainable innovation”, relevant on-going research, and an efficient, secure environment for “developing and nurturing designs”. In its search, Cadence has come across local regulations and procedures which do little to aid design. One country – unnamed by Leach – requires that any ‘imported’ intellectual property (IP) be assessed by custom officials to determine the job risk it poses to local engineers. “Of course no one does this and all are guilty of smuggling,” says Leach. Another country imposes a ten per cent tax on worldwide revenues from IP created locally. While officials played down the effect of the tax, they would not remove it, adds Leach. Yet there are environments which not only offer a secure place for design but are keen to attract high-tech companies such as Cadence. Leach speaks particularly highly of regional economic development agencies: “They are willing to help you and will pay you too.” Leach praises the development agency Scottish Enterprise. Scotland was not one of Cadence’s original candidate sites for potential engineers but once involved, Scottish Enterprise proved effective in getting things done. “They appreciated the electronics timeframe.” The result is Project Alba of which Cadence is the first company to join (see Electronics Weekly, March 25). Alba will comprise a system-on-a-chip design centre, an IP exchange and a technology incubator. Of the design centre’s 3,000 and 4,000 jobs, 1,900 will be created by Cadence. An accompanying M.Sc. course on chip design involving four Scottish universities is also being set up. “Getting professors to move is like herding cats,” says Leach. Yet once the universities realised the differentiating nature of the degree, it took just five months to create. Leach is quick to stress that there is nothing unique about Cadence’s success in securing design talent overseas. Setting up ventures overseas will not be easy, warns Leach, and mistakes will be made. It will also involve tying up senior people in your company. But Leach is in no doubt that the effort will be rewarded handsomely. Moreover, there is an obvious advantage in acting early: “Since you are one of the first they [the development agencies] talk to, who do you think sets the rules?”

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