Analytical Target Cascading (ATC) is an effective decomposition approach used for engineering design optimization problems that have hierarchical structures. With ATC, the overall system is split into subsystems, which are solved separately and coordinated via target/response consistency constraints. As parallel computing becomes more common, it is desirable to have separable subproblems in ATC so that each subproblem can be solved concurrently to increase computational throughput. In this paper, we first examine existing ATC methods, providing an alternative to existing nested coordination schemes by using the block coordinate descent method (BCD). Then we apply diagonal quadratic approximation (DQA) by linearizing the cross term of the augmented Lagrangian function to create separable subproblems. Local and global convergence proofs are described for this method. To further reduce overall computational cost, we introduce the truncated DQA (TDQA) method that limits the number of inner loop iterations of DQA. These two new methods are empirically compared to existing methods using test problems from the literature. Results show that computational cost of nested loop methods is reduced by using BCD and generally the computational cost of the truncated methods, TDQA and ALAD, are superior to other nested loop methods with lower overall computational cost than the best previously reported results.