Surviving CAE evolution

Electronic News, June 14, 1993 by Jeff Dorsch

David Chen, Mentor's vice president of corporate marketing, said the EDA market is "nearing a maturing point," with growth slowing down. "We need to be managing this company for reasonable growth, and for margins and profitability," he said. The prescription? A return to the basic fundamentals, according to Mr. Chen; "The right product at the right place."

Customers want "whole environments," which broad-line suppliers can provide. That includes a variety of services and products. "There's no room for a hollow distribution company," the Mentor executive said. "We provide value to the customer by providing solutions, training, building, changing methodology. We don't see a viable model in becoming a supermarket of CAD. That's doomed to failure."

In the 1980s, users wanted "one-stop shopping for reasonably well-integrated solutions," he added. In the 1990s, "The world's gotten a whole lot more complex." The user now wants a "multi-vendor, low-maintenance design environment."

Asked how Mentor and other large companies keep their engineering talent, Mr. Chen responded "How does Sun or Motorola or Intel hold on to their best-of-breed engineers? It's a gross fallacy that everybody wants to be in a high-tech start-up. There are different kinds of strokes you get in a large company than you can in a small company."

The role of the broad-line EDA supplier is "changing," Mr. Chen said, but to suppose that such suppliers can't survive due to the multiple industry pressures is "very simplistic and naive."