Business 101: Driving Connections

Tanner EDA was founded in 1988 by Dr. John Tanner, and has enjoyed steady growth throughout these past 22 years. Headquartered in Monrovia, California, the company provides a full suite of analog and mixed-signal design tools, as well as tools for MEMS design. To date, Tanner EDA has shipped 33,000 licenses to 4000 customers in 67 countries.

Last year, after leading this privately held company for over 2 decades, Tanner and team decided to re-invigorate the enterprise by bringing a new president on board, Greg Lebsack, with John Tanner continuing to serve as CEO. Lebsack brings to the task his extensive management experience in IT, telecommunications, and Internet-based industries. Previously, he served as CEO of ASP Global Services.

Lebsack and I spoke by phone in late May about the challenges of 'shaking things up' at a company that has enjoyed significant, measurable success for so many years.

Lebsack said, "Tanner is fortunate to have built a very large user base. In an industry like EDA which is normally very segmented, our situation is impressive. Throughout our history, however, we've paid strong attention to our products and less on marketing. Over this last year with the new executive team, we've started to revise that.

"We were lucky to have recruited Hamed Emami as Vice President of Sales, with his solid 20-years' EDA experience, previously doing sales for Magma in Japan. He's got a great network of people that we're building on. Also, John Zuk has joined the company as Vice President of Marketing and Strategy, bringing his 20 years' experience at the intersection of business and technology."

Lebsack said when a company starts from a position of strength in the market, there are many options available for expanding on the message. Among them, Tanner EDA has chosen to focus on driving additional connections -- connections with colleagues in the tool vendor ecosystem, with existing customers, and with a wide range of potential customers.

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The real question …

Lebsack noted, "The real question is, however, how do we continue to grow the business, [particularly] as every year the ecosystem is more competitive? There are always new entrants, the Big Guys get stronger, and the customers keep evolving. We need to evolve as well."

"In the old days, nobody ever got fired for choosing IBM. Today in EDA, we want people to know there are alternatives. But if we're not being visible and making customers aware that we're growing with the industry, they won't understand that we are one of those alternatives."

Lebsack added, "We don't try to force people into our flow. From a flexibility perspective we can fit into other people's flow, importing data from other tools, and then when we're done, popping that data back into the other tools."

Nonetheless, Tanner does offer a complete solution, according to Lebsack: "It has been important to John Tanner since the very start of the company to provide not only value-based tool pricing, but a complete platform as well that has low overhead -- something that's unparalleled in the EDA world right now. A significant number of our customers use our full flow -- it's very important to them -- but larger accounts have to have choices. They use the best parts of our tools, and drop them into their Best-of-Breed tool flow."

"[Most importantly], Tanner tools have a low learning curve that enables design projects to kick-off in hours, not weeks. Our tools are easy to use and extremely intuitive, [comprised of] a cohesive toolset and an integrated design environment."

Given all this, Lebsack emphasized: "We want to get the message out that Tanner EDA has always been making great tools. Even as the industry had evolved, Tanner is still here."

If Tanner's been viable for more than two decades, with a "clear and uncontested" value proposition in place, is all of this new messaging really necessary?

Lebsack responded, "If your products remain stagnant, your business model goes out of date. That has not been the case at Tanner, but as new technologies emerge and customer requirements change, tools like Tanner's are expected to keep pace with customer expectations."

"When I joined the company last year and started talking to customers, people certainly knew of Tanner. We had a fine reputation, particularly our L-Edit product, but most people's knowledge was dated. They had used our tools in grad school, or knew of features [associated] with the product 3 versions ago."

The purpose of the new, updated messaging, Lebsack said, is to remind current and future customers, and fellow tool vendors, that Tanner has indeed kept pace: "Unless we are perceived as refreshing the market segment we serve, we will be perceived as stagnant."

"We decided that one of our new messages had to be: We've got a strong, established customer base built around R&D where people are creating the rules as they go. The flexibility of our tools is a good fit in that environment."

"Cambridge Silicon Radio, for instance, is one of our big successes. Their first-generation product was developed using Tanner technologies. We've looked at how they created breakthrough technology, and saw clearly that innovation can happen on our tool platform. We're saying that Bluetooth was born on Tanner tools!"

Lebsack continued, "We also wanted to show that Tanner tools are not just for creative R&D types. Innovation can be developed, and sustained, using our technology. For that, we looked to Knowles Acoustic, another Tanner customer, which has shipped 1 billion SiSonic MEMS."

"We're also focusing on foundry and PDK support," he added, "which is standard for the EDA industry, but has not been our traditional focus. Our R&D customers had built their own PDKs, so this has been a project for us -- to be stronger in this area."

"As we grow the user base, and look at mainstream production, one of the first requests from customers has been this type of support for PDKs. We're currently investing very heavily in this area, [evidenced] by our TowerJazz release in the November '09 timeframe, with more information coming during DAC with an exhibitor forum featuring X-FAB, TowerJazz, and John Tanner."

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Driving connections …

Clearly Lebsack's team at Tanner EDA is doing more than just beefing up the marketing message with all of this increased focus on expanding technologies. Lebsack agreed, but emphasized that the overall focus is still about driving connections.

"Customers are coming back to us," he said, "because of our reputation and extended relationships. This is where the emphasis on connections is crucial. Our customers are letting us connect with them at the transactional business level."

"In particular, because of our extensive experience with independent contractors, customer companies looking for contractors are allowing us to help with the introductions. Also, people with excellent skillsets are looking to us to help make the connections [with potential employers]. We are leveraging the fact of these connections [to grow the business]."

Are conferences an important source of connections? Will Tanner EDA be at DAC? Lesback responded enthusiastically, "Yes! It's the responsibility of all companies in the industry to support the show, and deal with the issues."

"We think it gives us good exposure when we talk to new prospects. They always remember us being at DAC. We've actually had first contacts at DAC, which became deals that were then closed."

"Of course, we're responsible for the messaging, but DAC must bring in the customers. To do that, they need strong panels and exhibitor forums."

Lebsack noted that some events are particularly valuable for driving connections with fellow vendors: "Last week, we attended the GSA event in London, which was primarily vendors. It was a good networking event and a great opportunity to meet other potential partners."

Finally -- if connections are critical, why has Tanner remained anchored in Southern California for 22 years when the EDA industry is centered in Silicon Valley?

Lebsack answered easily, "That has been a conscious decision. Tanner EDA is an engineering-focused company [based on the philosophy] that if we build a better mousetrap, customers will always find us. Plus, in addition to our offices in Monrovia, we have sales offices in Japan and Taiwan, and seven additional strong distributors."

"Yes, EDA is a Silicon Valley based industry, but there are very successful EDA companies in Taiwan, Oregon, and Europe as well. Like Tanner, they taken the approach: We'll do it our own way."

Lebsack concluded, "We're going to do business and serve a market segment that we're comfortable with. That thinking drives everything we do."

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Editor's Note …

Tanner EDA is driving lots of connections at DAC in Anaheim, June 14-17.

* Exhibitor Forum Presentation

Monday, 10:15-10:50am
Tanner EDA presenting with development partner IC Mask Design Ltd.
Speaker: IC Mask CTO Ciaran Whyte
"High Performance Device and Structure Generation for A/MS Design "

Monday, 10:55-11:30am
Speaker: Tanner Research Chief Scientist, Massimo Sivilotti
"Challenges and Opportunities Related to PDKs for Analog Design "

* Activities in Booth #1342

Presentations: SoftMEMS, Sound Design Technologies, TowerJazz, XFab, Advinno,
Trident Technologies.

Demonstrations: ESP by mentalist Bob Garner on Monday & Tuesday.

Demonstrations: v15 of Tanner's HiPer Silicon full-flow design suite.

* Inaugural User Forum/ Event

Thursday, 8:30-11:00am
Tanner EDA: "Technology Trends"
V Semi: "Driving Analog Innovation at Deep Submicron Scale"
FLIR Systems: "Driving Analog Innovation in Image Sensors"

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Peggy Aycinena is Editor of EDA Confidential, a Partner in EDAMarket, and a Contributing Editor to the DAC Knowledge Center.