Engineers caught between innovation and cost-cutting

Engineers caught between innovation and cost-cutting
By Crista Souza, EBN
February 6, 2002 (7:52 a.m. EST)
URL: http://www.eetimes.com/story/OEG20020205S0024

The urge to innovate is being tempered on some fronts by the need to curb costs, as indicated by last week's DesignCon 2000 trade show here, attended by engineers, engineering managers, and corporate executives.

Research presentations and product rollouts painted a picture of an engineering community that has shifted its efforts toward reusing existing designs, at both the chip and system levels, to get more bang for the buck.

A flood of IP integration platforms, partially reconfigurable devices, reference design systems, and the like were touted at the show as offering safer and faster routes to market for next-generation products.

Meanwhile, executives called on designers to help stir the market out of its downturn-induced stupor.

"We need to get out of our current doldrums, stand up and be accounted for," said Byron Anderson, senior vice president and general manager of Agilent Technologies Inc.'s Electronic Products and Solutions Group, San Jose. "The most successful companies are going to be the ones at the tip of the spear."

The trick, Anderson said, will be homing in on relevant innovation.

But when coming out of an economic slump, it's largely a guessing game to determine not only what will be relevant, but when, show attendees said. Few companies now have the luxury of hedging their bets with dual design efforts, noted Warren Miller, vice president of marketing at Avnet Design Services, Milpitas, Calif.

"In the past, we saw customers designing at two levels: on one hand, they focused on cost-reducing existing designs, while other teams were off doing more feature-rich solutions for the next generation," Miller said. "What's happening now is customers are having to choose one or the other."

Applied Micro Circuits Corp., San Diego, has seen this polarity, as OEMs are forced to choose their level of risk.

"Some of our customers are focusing on very advanced 40Gbit/s products," said Gregory Winner, AMCC's se nior vice president of engineering. "The majority, though, are trying to make the most out of existing products. We're seeing larger steps between generations, rather than incremental steps."

The difference seems to lie in what market a customer is targeting, said one executive.

When electronic content isn't a differentiator, as in many consumer-oriented systems, cost reduction is crucial. However, cutting-edge designs are still being undertaken in markets where ultimate speed and performance is key, such as high-speed networking gear and graphics systems, said Steve Carlson, vice president of marketing at EDA vendor Get2Chip Inc., San Jose.

"A lot of products can be optimized in software, and that's where platform-based design makes sense," Carlson said. "For most of the people we sell to, the heart of what they produce is differentiated in silicon. Right now they're pumping a lot of money into new developments that will see the light of day sometime in the fourth quarter [of 2002]."

Not everyone sees innovation and cost reduction as mutually exclusive. Standard platforms and reference designs can be used to stretch design dollars by reusing existing, verified elements to which OEMs can add their proprietary twist and quickly enter the market, DesignCon participants said.

"It makes sense to take advantage of blocks others have already put time and money into developing," said Victor Berman, director of marketing at configurable-DSP supplier Improv Systems Inc., Beverly, Mass. "Even if what you're doing is experimental, usually that represents a small part of the design. Usually 90% to 95% of a design can be reused."

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