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Custom EDA Tools, Custom IC Design | Tanner EDA

Emerging strategies for better decisions

Choosing a set of tools to populate a design ecosystem is a complex decision, and one that can have a major impact on the health and viability of a company. Within a company, the constituencies that are empowered to make such purchase decisions are often formed too conservatively - for example, engineering and engineering management will work on their own to evaluate and procure the tools. This situation must change.

Because the cost of custom design tools is so great, and the long-term success of a technical organization is so dependent on those tools, a much larger set of departments within the enterprise now needs to participate in the decision-making process. Those constituencies must include senior management, accounting, IT, and - if it exists - the CAD tool department, of course. When all of these parties have ownership of the tools purchase decision - along with engineering and engineering management- the design ecosystem has a far greater chance of success.

In the current climate, what are the expanded criteria that must be addressed to guarantee that the design ecosystem will optimize the often-conflicting needs and constraints within a company— including technical needs as well as matters related to internationalization, communication, workflow, finance, and security? Clearly, IT metrics are important, as well as cost/benefit and ROI considerations. This paper lays out a methodology for evaluating those considerations, while also keeping track of the traditional engineering mindset used to determine the worthiness of a design tool or tool suite.

CAD Tools as a business process

Legacy issues- such as prior experience, tool familiarity, established design flows, and vendor name recognition - often drive the design tool selection process more than functionality and financial considerations. Design tools have long been considered a standalone capital asset, independently purchased by engineering and administered and maintained outside of the company's IT infrastructure. Classic IT metrics such as return on investment (ROI), total cost of ownership (TCO), and price/performance tradeoff have rarely been applied to the purchase and deployment of EDA CAD tools.

That situation is changing. Although engineering productivity still sits at the center of tool purchasing decisions, evaluating the true costs of a design environment now presents a more complex problem than simply looking at the price of the individual tools.

Engineering tools are not a goal by themselves. Rather, they serve as a component - albeit a critical one - of a business flow that begins with investments in a product concept and ends with the sale of a completed product. As such, CAD tools should be subject to the same business analysis and continuous process improvements that are common in every other aspect of business management.

What are the goals of the process improvements related to engineering CAD tools? There should be seven generic objectives:

  • To achieve a measurable (and hopefully dramatic) ROI.
  • To rapidly recoup tool investment.
  • Speedy revenue growth in combination with reduced operating expenses.
  • Increased flexibility to changing business conditions.
  • Operational efficiency in a global economy.
  • Minimizing risk.
  • Improved working conditions ("Quality of Life").

Several of these objectives are purely financial, while others, such as flexibility and working conditions, are more subjective. The recouping of investments and ROI are prerequisites for short-term success, while revenue growth, reduced expenses, and flexibility are the hallmarks of long-term leaders in an industry.

Meanwhile, companies that minimize risk while constantly seeking to improve working conditions are likely to retain their single most valuable investment—personnel. Successful managers know that personnel stability is a crucial prerequisite for continuous product improvement; staffing concerns must be part of the business analysis when we consider the costs of CAD tools.

How much do CAD Tools really cost?

Two metrics dominate the financial analysis of end-user software investment: ROI and TCO. These metrics are not foreign to financial managers evaluating software purchases for business applications. However, applying these metrics to engineering software is a new yet necessary idea, given the current costs of product design and implementation. The standard equations used by financial managers must become part of the engineering manager’s lexicon.

Understanding Return on Investment

First, we must explore the meaning of the return on investment - ”ROI” - of a purchase or expense. Acronyms are often interpreted intuitively, but a more rigorous treatment can be instructive.

In principle, calculating ROI is simple:

Earnings and investment are incremental quantities: "If I invest X dollars in a new system, what additional profits will I obtain?"

Of course, the time period over which these benefits accrue is critical, particularly in terms of first-year ROI. Limiting the payback period to the first year allows the resulting productivity increase to set the baseline for subsequent periods. Meanwhile, there is a more sophisticated expression for ROI:


A = capital costs of software, hardware, etc.
L = monthly labor cost
C = training time in months (considered lost productivity)
D = productivity loss during training
E = productivity increase with new system

This more elaborate ROI equation incorporates the loss of productivity as users ramp up on a new system, along with the costs of purchasing the new system, the costs of training, and, of course, the enhanced productivity gained from upgraded tools. This calculation and analysis provides a more detailed look at the true return on investments in new CAD software. (see Figure 1)

Figure 1 — True return on investment on CAD software

How to Do More with Less

Although ROI calculations are essential, they often blur the more fundamental question: "How do I do more with less?"

Financial and human resources are limited. It's this kind of "clean-sheet" thinking that has led to the rise of outsourcing and, more recently, offshoring. Budget considerations for these strategies, versus supporting new tools and skills in-house, must evaluate the tradeoffs between tool costs and engineering headcounts. The analysis is more complicated than a simple process improvement analysis.

Outsourcing and offshoring both suggest that labor costs are no longer directly related to productivity—labor costs vary tremendously from one labor market to another. These variances must be further adjusted, therefore, for the different capabilities and different management and interaction costs across geographies.

Total Cost of Ownership

Since the mid-1980's, the concept of total cost of ownership (TCO) has been widely promoted by Bill Kirwin of Gartner Group (San Jose, California). Unlike the differential earnings model suggested by the ROI calculations above, TCO considerations attempt to add up the direct and indirect costs incurred throughout the entire life cycle of an asset.

Those costs may include purchasing, deployment, training, operations, support and, eventually, retirement of the tool. They may also include direct hardware and software costs, operations costs (including CAD managers), administration costs (including user training), and the indirect costs of lost productivity due to unexpected downtime and other computer-related distractions. TCO calculations help illuminate the many hidden costs of owning design tools.

"For a lot of companies today, the only way to stay competitive is to keep taking advantage of the same technology that their competitors are using, as new products continue to hit the market. And some organizations may not even want to know how much that's costing them," says James Delmonte, president of JDA Professional Services Inc. in Houston, an IT staffing firm that also performs costbenefit consulting.

A TCO analysis improves an engineering team's ability to execute on the strategic business goals laid out by management. However, the success or failure of the company ”though frequently a consequence of the success or failure of the engineering team” is the responsibility of the senior management team. Senior management may consult with CAD and engineering managers in thenprocess of making decisions with financial implications, but issues such as headcount and budget tradeoffs extend beyond the responsibility and vantage point of group managers.

Dealing with Globalization

As barriers to communication, travel, education, and capital investment decrease, the IC design industry is poised for the explosive growth of offshore engineering. This trend is the natural continuation of the globalization of semiconductor manufacture, following the example set in recent years by the offshoring of IC mask layout.

Companies wishing to take advantage of the cost benefits available from globally distributed product development teams face a number of challenges. Some of these -communication, management, and staffing- are universal and well understood. Other challenges, such as the selection, rollout, and management of EDA design tools, are unique to the IC design industry. Clearly, there are additional requirements placed on design tools able to successfully support an international, distributed user community.

The requirements are diverse: internationalization and localization of design tools and computer platform; quality of support, training, and documentation; licensing and other constraints on ownership; integration into geographically diverse workflows, issues of access control (security), and the robustness and reliability of wide area and virtual private networks (WANs and VPNs), to name just a few.

In addition, it is becoming increasingly obvious that distributed design teams require face-to-face interaction at regular intervals in order to preserve a sense of team and common purpose. The concepts of globalization are intriguing and increasingly a reality, yet the human side of the globalization equation remains unchanged. Companies that are committed to a distributed design effort, either through outsourcing or offshoring, must pay attention to the logistics of distributed tools and project partitioning. But they also must attend to the realities of differing time zones and human interaction across cultures and language.

Key criteria for selecting custom design tools

Having laid out a variety of criteria, financial and otherwise, to keep track of while assembling a design environment, it's appropriate now to consider the list of features that deserve significant attention while purchasing the tools themselves.

  • A reliable compute platform
  • Ease of use and integration
  • Reliability of use
  • Customer support
  • Flexibility of ownership
  • Workgroup support
  • Industry standards
  • Available engineering talent
  • Training resources
  • Tool Capabilities
  • Vendor reputation and history

A Reliable Compute Platform

Of course, if you lack a reliable, usable compute platform to start with, no design tool will get the job done. Furthermore, having to rely on consultants to configure, install, and maintain application-specific platform configurations is expensive and presents a migration risk for the future. Take great care in choosing the computer environment before purchasing the tools.

Ease of Use and Integration

The second crucial consideration is the ease of use of the tools. Tools that maximize operating efficiency, while offering reduced training costs, are ideal. Localized, multi-language user interfaces should be standard with the tool to allow comfortable use on internationalized platforms. Ease of deployment, administration, and maintenance are also important.

Don't overlook the integration of the tool with other workflow applications, such as e-mail, documentation flows, backup, and disaster recovery. Look to these details beforehand to reduce frustrations after the purchase is complete. Then buy tools that are easy to use, even if only used on occasion - tools that, when revisited, are like a bicycle. You never forget how to use them.

Reliability of Use

You must also consider reliability. Just as your computer platform must be reliable, your tool application itself must be dependable as well. If a tool crashes or is otherwise unavailable for use, no amount of built-in features or customer support will make up for lost time to get the design completed accurately and on schedule.

Customer Support

Customer support should be a key consideration in your purchasing decision. The cost, quality, and responsiveness of the vendor's customer support - including availability and quality of documentation - are important factors. Tool robustness and intuitive usage play an indirect role, by minimizing support needs. Support should be considered a form of insurance: you hope you don't need customer support, but having reliable support options will mitigate the risk of catastrophe.

Flexibility of Ownership

Next comes a host of questions related to the flexibility of ownership. How is the tool sold? Are licenses perpetual or time-bombed? What licensing options exist - node-locked, multi-CPU, network, or commuter - and how flexibly can policy restrictions be imposed? What restrictions exist on WAN/VPN sharing of licensing across countries and time zones? Knowing the answers to these questions before making the purchase will ease the worries and woes for everyone involved after the purchase and implementation of the tool.

If the design tools will be used by a team of more than one, features within the tool that support group workflow may be decisive in the success of the project. Those features include revisions control, access control, and policy controls for IP management.

Workgroup Support

Because workgroups are commonly separated geographically, support for WAN data exchange and robustness in the face of unreliable network connectivity are now critical. Before purchasing the tool, find out what will happen if network access to the license server is interrupted. Know in advance if work will be lost in those circumstances.

Industry Standards

Standards are always important when it comes to design tools and environments. Using tools built to industry standards, which are non-proprietary, increases the ability to incorporate those tools into a diverse array of new or existing flows and minimizes the risk of "data lock-in" in the future.

Available Engineering Talent

It is critical to have a local, readily available pool of engineering talent that already has familiarity with the tool or toolset. Although this can appear to be a two-edged sword—after all, potential competitors value the same skill set that you do - in the end, a pre-trained labor pool allows more flexibility in pursuing new projects and provides a more stable environment to complete them.

Training Resources

Inevitably, inexperienced staff facing a new tool - or experienced staff facing a feature upgrade - will require updated skill sets. The fastest and lowest risk approach is vendor-approved training. Find out what training options are available to you, and if they will occur onsite or offsite. If there are tutorials, training programs that can be customized to your site, or academic courses available in the area—know in advance of buying the tool. Don't purchase the tool and then explore the training option.

Tool Capabilities

Naturally, the capabilities of the tools cannot be ignored. However, unless all of the previously discussed issues are satisfactorily addressed, even the most intrinsically capable tool will go to waste. It's essential in the tool evaluation process to have a clear set of evaluation criteria; ideally, these will be developed before any evaluation actually begins.

Ironically, one frequently overlooked feature is the speed of the tool. Engineers or their managers often start the tool search process with a laundry list of features they believe they need. But that list rarely includes the ergonomics or speed with which the sought after features are actually executed by the tool. This is a common mistake. Certainly at Tanner EDA (Monrovia, CA), we advocate for a methodology among our customers that maximizes the productivity of their engineers. That productivity is directly related to the capabilities of the tools, but also to the speed of the tools. To our way of thinking—performance is a feature when it comes to evaluating tools.

Vendor Reputation and History

Finally, there is the qualitative issue of vendor reputation and history. The purchasing decision should include an evaluation of the vendor's business practices, maturity of the product portfolio, commitment to further development, frequency of versions and updates, rate of incorporating new features, and vendor receptiveness to customer-driven improvement. Most importantly, find out how quickly defects in the tool are repaired and new service packs released.

Assembling a design environment

Clearly, the coordination of tool selection criteria requires a great deal of sophisticated experience, as well as in-depth consultation with the various parties who are ultimately affected by the final decision.

The choice of custom design tools has a significant impact on the technical outcome of a company's efforts, and, by implication, the financial success of the organization. Assembling a design environment warrants a serious conversation across the entire organization. [See Figure 2]

Choosing the right CAD tools is extremely important to the success of every design project. While most engineering managers can readily identify the technical requirements of the tools needed, they often overlook other requirements - financial, platform, and ergonomic - when an opportunity for making a collective purchasing decision is missed across the organization.

The long-term solution for success in assembling a viable design environment must involve a triangle of decision makers - senior management, CAD managers, and engineers - each of whom offers candid input and a willingness to compromise, so that the constraints of all of the stakeholders are met to the best ability of the combined group.

Figure 2 - Concerns vary among different groups


At Tanner EDA, we are often asked to mitigate unfortunate situations in which customers have gone into a project ill-prepared, both financially and technically. We often see that these problems could have been avoided, if appropriate and methodical decision making processes had been applied at the outset - not just with regards to the scope of the project, but, more fundamentally, with regards to the tools and the resources available to support the project.

The criteria enumerated in this paper should help our customers and all design teams identify and optimize to their particular constraints, and plan for success. When all constituencies within the enterprise are involved in the decision-making process—and that process is carried out within a proven structure of give and take—all parties involved, from the top of the organization down into design and product implementation, have ownership of the decision and share in the ultimate success of the project.

Why Tanner EDA for custom IC design?

A ubiquitous, manageable, reliable compute platform

Tanner Tools run under Windows®, the most available platform worldwide. Windows is extensively localized, and designed with ease-of-use and ease-of-management in mind. Excellent international updates are available for free. Windows machines can be purchased anywhere. They are easy to manage and extremely cost effective. Furthermore, we benefit indirectly from the popularity of the Windows platform. For example, the extensive video game industry drives the development of high-performance graphics cards and drivers. At Tanner EDA, we take advantage of that market driver to produce the fastest mask rendering in the industry.

Ease of Use and Integration

Tanner EDA offers an 18-year history of mask editor UI (user interface) development. Operator efficiency has always been critical in cost-sensitive layout shops - and we understand that. At the same time, the tools are extensively customizable and extensible, allowing easy UI interaction with customer-provided macros and extensions. Finally, another benefit of the Windows platform is its ease of integration with third-party tools. For example, you can copy and paste data (such as layout, simulation plots, and schematic diagrams) directly from our tools into your documentation tools.

Reliability and Support

Every vendor believes they have the most robust tools and the best support. The only way to know for sure is to test them out. At Tanner, we welcome the chance to demonstrate our portfolio of tools. We take pride in our track record and the quality of our tools. We believe customer support is the only path to long-term success in the tools market.

Flexibility of Ownership

Tanner EDA is one of the few EDA vendors that still grants perpetual licenses to its tools. In other words, there is no down-the-road customer risk when time-based licenses have to be renegotiated. We have to answer to our customers regularly regarding the quality of our tools and the responsiveness of our application support. Tanner is one of the few vendors in the market today that does not restrict the geographical use of network licenses. A home office can easily share network licenses worldwide over a properly configured VPN.

Available Engineering Talent

Tanner Tools are in use in over 700 educational institutions worldwide. Coupled with our long market history and large installed commercial base, these factors contribute to a significant population of pre-trained engineering talent already in the market, and entering the market at a steady pace. In addition, there are various training options available to our customers - both in Tanner's Monrovia office and at customer locations - that can bring engineers new to the Tanner tools up-to-speed quickly and efficiently.

Integration with Existing Tools

Tanner Tools support all major industry standards, including GDS, CIF, DXF, and Gerber. The tools also support ad-hoc standards such as SPICE, and interoperate easily with various dialects, including HSPICE, PSpice, and CDL. In addition, Tanner tools support external formats, such as Virtuoso technology files, DRACULA® DRC-rule decks, and Calibre® DRC-rule decks.

Vendor History

Tanner has been in the EDA business for over 21 years, and is proud to be one of the longest-standing companies in the industry. Our privately held business model guarantees stability for our long-term customers. Tanner customers know that we are there for them today, and will be there for them tomorrow. We take pride in that knowledge.

About the Author

Massimo Sivilotti , Chief Scientist, Tanner Research, is responsible for setting strategic directions for Tanner's EDA tool development, developing specifications for new feature development, and working with customers to support their evolving needs. Sivilotti has been involved in microelectronics design and EDA tool development for more than 20 years.


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