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The Aerospace and Defense industry is currently challenged in multiple ways - cost cutting and sequestration on the defense side, and spurt of growth on the commercial aviation side of business. While these are opposing trends, both will impose severe challenges to the management of product development process for both the Air framers and the suppliers. The challenge becomes severe as the innovation expectations become rapid with increases in embedded software content in avionics and the advent of a new category of autonomous ground, marine, and air systems. Clearly, the industry need is to have a product development process that allows for reducing costs, while increasing embedded software quality and thereby product quality even in an iterative development process.

Hardware-in-the-loop (HIL) testing is an indispensable tool in the software development process for electronic control units (ECUs) and Logical Replaceable Units (LRUs) and is an integral part of the software validation process for many organizations. HIL simulation is regarded as the tried-and-tested method for function, component, integration and network tests for the entire system. Using the Model based design approach has further enabled improved and faster HIL implementations in recent years. This paper describes the changing requirements for HIL simulation, and how they need to be addressed by HIL technology. It also addresses the challenges faced while setting up a successful HIL system: namely the division of tasks, the total cost of ownership, budget constraints and tough competition and the adaptability of a HIL simulator to new demands. These requirements are discussed using a dSPACE HIL system architecture that was designed from the ground-up to address these needs.