BY SCOTT SANDLER
President and Chief Executive Officer,
Novas Software Inc.,
San Jose, Calif.

The year 2000 was euphoric, right from the fizzle of the Y2K problem. This year is different. We've got to earn our keep.

For companies with poor business models, the change in climate could be catastrophic. But for those that have real products, deliver value in a way that makes sense and take care of customers, things will be fine.

Customers buy from a company because it delivers value. In electronic design automation, that value comes from productivity. Tools that help design teams get a product out the door faster make the companies that use them more profitable. Some EDA vendors will do well in the new climate; others will struggle.

EDA customers-those who develop integrated circuits and other electronic devices-have basic needs that must be satisfied, no matter what the climate. Clearly, they need core automation tools like simulation and synthesis, the "hammer and saw" of modern IC design, without which no work gets done.

Just as important are tools that focus on the human element to boost productivity. As electronics companies trim teams and cut costs while keeping their key projects on track, they need to find ways their limited staff can do more in less time. Although companies can ill afford to overhaul their design process right now, they will invest in making their engineers more productive. Those companies that deliver value through productivity enhancements within the established flow should do well.

Of particular concern is the growing human effort required to verify large, complex designs. As more and more intelligence is packed into smaller and smaller packages, it gets harder to understand everything the design is supposed to do. This is not just a matter of size, or even complexity: A key contributor is the growing reliance on design reuse, outside intellectual property (IP) and large design teams that are geographically dispersed. Having a lot of engineers on a design team, sharing the work around the world and pulling in blocks from previous designs or commercial IP vendors, is great for creating a design fast. But that process leads to a lack of understanding of the design, and verification productivity suffers.

Debug is an example of where direct human effort and lack of design understanding increase costs. When designers track down bugs, they are neither adding value to the design nor speeding the chip to market.

Today's business climate likely won't last much beyond 2001. Weathering it challenges both EDA companies and our customers. Delivering value to our customers is the only way to deliver value to our shareholders.

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