Zinnov Management Consulting, a leading Globalization and Market Expansion Advisory firm, today launched its much awaited Rating of Global R&D Service Providers’ across geographies. The study titled “Global R&D Service Providers (GSPR) Rating 2014”, is an annual study to assist business leaders spearheading global engineering initiatives make right decisions in partner selection across geographies. For more information visit www.zinnov.com

1. Global Service Providers Ratings -2014
25th September, 2014
This report is solely for the use of Zinnov Client and Zinnov Personnel. No Part of it may be quoted, circulated or reproduced for distribution outside
the client organization without prior written approval from Zinnov.
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2. 2
Global Engineering R&D Landscape
Key Trends in Global Engineering & RD Services
GSPR – 2014 Rating

3. 3
$577 Billion
G500 R&D spend in 2014
Global Engineering R&D Landscape
Key Trends in Global Engineering & RD Services
GSPR – 2014 Rating

4. R&D spend continues to be on the rise with focus on building better,
faster and smarter products
FY 2014
577 Billion
R&D spend by Global
500 companies
USD 110 BN USD 68 BN USD 59 BN USD 48 BN USD 45 BN
Automotive
Electrical &
Consumer Electronics
Telecom &
Networking
Software and Internet Semiconductor
Volkswagen
Toyota Motor
General Motors
Robert Bosch
Honda Motor
Ford Motor
Daimler
BMW
Nissan Motor
Denso
Samsung Electronics
Panasonic
Sony
Canon
Hewlett-Packard
Apple
Toshiba
Fujitsu
Fujifilm
Mitsubishi Electric
Microsoft
Google
IBM
Oracle
Amazon.com
SAP
EMC
eBay
Facebook
Electronic Arts
Nokia
Cisco Systems
Ericsson
Huawei Technologies
Alcatel-Lucent
NSN
NTT
Research In Motion
Telefonica
ZTE
Intel
Qualcomm
STMicroelectronics
Broadcom
Texas Instruments
Renesas
Taiwan Semiconductor
AMD
Applied Materials
Nvidia
Source: Zinnov Research and Analysis 4

5. The addressable Engineering and R&D globalization and services
opportunity stands at USD 170 billion
Total Addressable
R&D Globalisation &
Services opportunity
Addressable Market*
USD
170
Billion
Addressed Market
USD
55
Billion
Total Addressed
R&D Globalisation and
Services Market
Current Addressed ER&D market through
offshore in-house R&D Centres
USD
29
Billion
Addressed ER&D Globalisation & Services market
through Outsourcing partners
USD
26
Billion
*Opportunity Includes market for Captives , Offshore R&D Service Providers and Onshore R&D
Service Providers
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6. 6
Global Engineering R&D Landscape
Key Trends in Global Engineering & RD Services
GSPR – 2014 Rating
$38 Billion by
2020
India’s ER&D services and
Globalization revenue
(Expected)
India Engineering R&D Landscape
Source: Zinnov Research and Analysis

7. India’s ER&D globalization and services market is expected to reach $38
Billion by 2020
Product Engineering Services Growth Rate ( In USD Billions)
USD
16.56
BN
USD
18.20
BN
Growth rate
9.9%
Growth rate (Expected)
12.05 %
USD
38
BN
FY 2013 FY 2014 FY 2020 (E )
Note 1: There is an increase of $264 Million to the overall numbers for 2013 because of a revision in the Automotive vertical numbers, we have corrected the estimates for 2013 retrospectively.
Note 2: The estimated growth does not include Defense
All figures in USD Billion
$6.193
$6.887
$10.372
$11.312
Growth
9.06%
Growth
11.20%
Service
Providers
Service
Providers
In-house
R&D Centers
In-house
R&D Centers
FY 2013 FY 2014
• Service provider growth driven by entry
of existing players into newer verticals
• Verticals like Medical Devices, Industrial
Automation and Energy and beginning
to adopt outsourcing aggressively
• New In-house R&D centers are in
incubation stage, growth through
ramp-ups will reflect in coming years
Source: Zinnov Research and Analysis 7

8. 8
Engineering
Services is getting
re-defined
Global Engineering R&D Landscape
Key Trends in Global Engineering & RD Services
GSPR – 2014 Rating

9. 9
aggressively pursuing the “in-country sourcing” opportunity
exploring newer customers segments for added growth
building deep solution capabilities for the connected world
collaborating with start-ups to drive innovation
The Product
Engineering landscape
has evolved and Service
providers are
responding to the
change by….
diversifying into newer verticals because of reduced entry barriers
Source: Zinnov Research and Analysis

10. 10
Indian Companies
Leaders in the ER&D
Services
Global Engineering R&D Landscape
Key Trends in Global Engineering & RD Services
GSPR – 2014 Rating

11. Zinnov’s GSPR is based on a proprietary framework that effectively
quantifies qualitative data and subsequently uses a AHP model
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Methodology
Data Point Classification AHP & Rating Scale
1 2 3 4 5
AHP is a statistical model used for assigning weights to the dimensions
and the data points. Rating point of 1 to 5 was decided for each data
point based on criteria
Classification of company and vertical specific data points available
from various RFIs
Ranking & Zones Data Extraction & Rating
Score Rank Look-up
For all data points extracted from RFIs, corresponding rating was
mapped in the Rating Scale
Companies were ranked based on the scores arrived from the previous
steps, using the parameter based modeler. The vertical specific
characteristics were then included to plot the companies in Zinnov
Zones
AHP Rating Scale
Data Point 1
Data Point 2

12. The GSPR rating is done by evaluating the participants across pre-identified
key performance parameters
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Human Capital
Human Capital is critical in analysis of company’s capability to deliver specific engineering needs. We considered vertical wise and
overall headcount, distribution by product development breadth, experience level, and special/additional qualifications
Capabilities & Innovation
Capabilities of the organization is assessed to understand the overall ability of the vendor to deliver on the requirements of clients; it
encompasses people dimension, operational capability, business models employed, Innovation & IP / solutions / Frameworks /
Products built / delivered by the organization
Financials
Financial Strength of a company plays a key role in the assessment process; apart from showcasing the financial health of the
organization, it also contributes in analyzing the ability to scale, invest and potential of the vendor to support the customer’s growth
Ecosystem Linkages
Strategic partnerships with OEMs and industry leaders, University connects for research, membership and contribution to global
development forums tell a lot about the provider’s capability in harnessing the ecosystem in R&D and product engineering space and
hence is an important criterion in evaluation
Infrastructure
Infrastructure investment (Labs, ODCs) demonstrates capability and commitment to growth. Also, geographic spread and expansions
throws light on the ability to leverage geo specific advantages. Investments in certifications and adoption of standards have strong
bearing on determining the processes orientation that is needed for delivering on remote product engineering and R&D activities
Business Sustainability
Client relationships, engagement model maturity with the customers, the ability to articulate and create a USP and the Governance
Risk and Compliance status are indicators of sustainability. We used these parameters to assess the sustainability index of the
partner, which help customers differentiate long term players from others
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13. Zinnov Zones – Overall Rating Model
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• Emerging Companies with Presence
Across Multiple Verticals
• Focus on Building Competencies
Across Multiple Verticals
• Developing Cross PDLC Competencies
across multiple verticals
• Emerging Companies in Niche
• Focus on Building Niche R&D and
Vertical Competencies
• Developing Cross PDLC
Competencies in Focus Verticals
• Market Leaders across verticals
• Presence Across Multiple Verticals
• Strong Focus on IP Creation,
Innovation and Ecosystem Linkages
across most verticals
• Excellent Breadth and Depth of
Services across most Verticals
• High Scalability across most verticals
• Market Leaders in Niche Verticals
• Well Established Competency in One
or Two Verticals
• Excellent Breadth and Depth of
Services in Focus Verticals
• High Scalability in focus verticals
Emerging Established
Scale, # of Verticals serviced, Client Spread
Expansive
Niche
Verticals
Specialization, R&D Practice Maturity (depth and breadth of services), Innovation & IP, Eco-System Linkages
What has changed?
• The Y-Axis earlier was a
function of vertical
coverage.
• In 2014, the Y-Axis is a
function of 3 key
parameters (Scale, Vertical
Coverage and Client
Spread)
• The additional dimensions
were added based on
customers feedback to
bring more granularity
• The Y-Axis should not be
compared to GSPR 2013
ratings on a like for like
basis

14. Overall Rating
14

15. 15
VERTICAL WISE RATING

16. ZINNOV ZONES EXPLAINED
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Nurture
Zone Breakout Zone Execution Zone
Leader
Zone
Challenges Attributes Recommende
d Initiatives
• New entrants, providing skill sets to
supplement R&D bandwidth
• Presence in only a few verticals:
Focused growth
• Innovation, if at all, in process
optimization
• Limited number of clients
• Typically work in T&M model
• Acquiring new customers.,
diversifying revenue
• Building product engineering
competencies
• Developing Engineering Services
specific Sales organization
• Understanding the differences
between PES/ IT Service business
• Focus on targeted customer
segment and vertical
• Build technology competency in
niche focus areas
• Focus on building credibility by
delivering on initial projects
• On the way into big league,
delivering R&D services effectively
• Presence in two or more verticals
• Innovation frameworks resulting in
tangible benefit to customers
• Typically work in T&M and Fixed
Price model
• Acquiring large customers
• Growing existing accounts and
repeat business
• Developing across the PDLC
competencies
• Building domain capabilities
• Building a product engineering
culture within the organization
• Focus on PDLC Skill Development
• Focus on augmenting domain
skills
• Work on building trust with
existing customers
• Capable of delivering complete
product development as a true
engineering partner
• Presence in almost all verticals
• Reusable IP’s built, and benefits
quantified
• Capable of working in all models,
including Risk Reward and Revenue
Share
• Growing small accounts into deep
relationships
• Building Concept to Market
Capabilities with deep domain
expertise
• Building relevant IP’s
• Executing on new & innovative
business models
• Limited self owned R&D infrastructure
• Focus on IP creation; create vertical
agnostic IPs
• Focus on Account Mining and
execution on new business models
• Focus on internal and external
innovation incubation efforts
• Capable of performing concept to
Go-To-Market for the product
• Presence in almost all verticals
• Formal innovation culture, resulting
in IP’s and numerous tactical
innovations
• Capable of working in all models,
including Risk Reward and Revenue
Share
• Succeeding as go to market partner in
emerging markets
• Building end to products of their own
• Building product management
capabilities
• Scaling new vertical practices in R&D
services to drive continued growth
• Scaling R&D infrastructure
• Focus on end customer of
customers
• Drive customer led innovation
• Build strong Go-To-Market
capability to become viable
channel partner for customers

17. AEROSPACE - 2014

18. AUTOMOTIVE - 2014

19. 19
COMPUTER PERIPHERALS AND STORAGE - 2014

20. CONSTRUCTION AND HEAVY MACHINERY - 2014

21. 21
CONSUMER ELECTRONICS - 2014
Zinnov Zones – Leading Service Providers
Source: Zinnov Research and Analysis

22. 22
ENERGY - 2014
Zinnov Zones – Leading Service Providers
Source: Zinnov Research and Analysis

23. 23
INDUSTRIAL AUTOMATION - 2014

24. 24
MEDICAL DEVICES - 2014
Source: Zinnov Research and Analysis

25. 25
OUTSOURCED SOFTWARE PRODUCT DEVELOPMENT – ENTERPRISE
SOFTWARE
Source: Zinnov Research and Analysis

26. 26
OUTSOURCED SOFTWARE PRODUCT DEVELOPMENT – CONSUMER
SOFTWARE
Source: Zinnov Research and Analysis

27. 27
SEMICONDUCTOR - 2014
Source: Zinnov Research and Analysis

28. 28
TELECOMMUNICATION - 2014
Source: Zinnov Research and Analysis

29. 29
TRANSPORT - 2014
Source: Zinnov Research and Analysis

30. 30
Bangalore
69 "Prathiba Complex",
4th 'A' Cross,
Koramangala 5th Block,
Bangalore-560 095.
Phone: +91-80-41127925/6
Gurgaon Office:
First Floor,
Plot no. 131, Sector 44,
Gurgaon-122002,
Phone: +91 124 4420100
Singapore
Level 42, Suntec Tower Three
8 Temasek Boulevard
Singapore 038988
Phone:+65 6829 2123
California Office
3080 Olcott Street
Suite A125,
Santa Clara, CA 95054
Phone: +408-716-8432
Texas
21, Waterway Ave
Suite 300
The Woodlands
TX-77380 USA
Phone:+1-281-362-2773
Beijing
Meilifang Tower 4, Entrance 4,
10/F #1003,
11 Beiyuan Shuangying Road,
Chaoyang District, Beijing
China 100012
Thank You