Effective Strategies in the Product Development Process

In order to meet increasing market demands, companies must not only launch products with new functionalities and improved features, but also redefine and reorganize the methods and processes of product development. The application of traditional product development methods reaches its limits and does not work sufficiently efficient. A rational and sustainable economy requires both innovative technologies and effective strategies and concepts for economic, ecological and future-oriented product development.

Effective Strategies in the Product Development Process

Product Development Process, Product Life Cycle and New Corporate Strategies

The product development process comprises the steps required to develop a new product or improve a producing brand. Such steps are:

  • Generation, verification and selection of new ideas (brainstorming)
  • Market, business and cost analysis and performance audit
  • Definition and verification of product and quality requirements
  • Concept (product features, production solutions, technologies)
  • Documentation of product parameters, functions and properties
  • Definition and verification of the technology required for production
  • Modeling and verification of requirements (prototype)
  • Design, product development and testing (prototype)
  • Troubleshooting, improvements and optimization
  • Coordination with management and production regarding the handover to series production (decision)

The steps design, development and test are considered the three most important phases of the product life cycle in the product development process. Depending on the business model and product type, other phases also belong to the life cycle, such as analysis of customer experiences and requirements, development of a marketing strategy or adaptation and modernization of production technology for a new product brand. In the case of innovative, technology-intensive products, such as those in the automotive industry, development is closely linked to research and takes place within the framework of a uniform "Research and Development" (R&D) process.

Strategy for developing a new product

The first phase in the development of a new product is the formulation of a strategy. Although products from different manufacturers may have similar characteristics and functions, the product development process is designed differently. Each company has its own strategy for new product development and its own resources. The strategy enables a company to optimally organize, manage and control the product development process and production processes according to its own resources and goals.

In this phase, strategic goals are defined which the new product must meet in order to gain market share or to take and maintain a leading market position in the field of technology, for example. On the other hand, a product development strategy can be designed to link the product development process with the processes of production and operation in the product life cycle and to harmonize, standardize and automate them in all stages of the production chain. To this end, special software products are used to integrate all technological processes and information flows as subsystems of the overall company-wide Product Lifecycle Management (PLM) system. Since the success of the new product is built up during the development phase, the product development process is considered one of the most important components and tasks of PLM software.

Especially companies striving for technological progress, market leadership and innovation need sustainable and successfully implemented strategies and intelligent software solutions for the manufacture of new products and for Product Lifecycle Management (PLM). The innovation of a company does not only consist in the development and production of new interesting products, but rather in the organization, further development of technology and product lifecycle management for the sustainable production of such innovative products. The focus of PLM is not only on the market situation and concrete products, but also on the product development process, PLM processes and an effective strategy.

A successful strategy adopts and uses the evaluated ideas, concepts and methods of Systems Engineering, Extreme Programming, agile product development, DevOps, IT, XaaS, artificial intelligence (AI) and Industry 4.0. Motivation. IT affinity and acceptance of the employees play a special role in the implementation of the new corporate strategy.

Agile vs. classical product development

An agile product development method is characterized by distinctive organizational flexibility, dynamic organizational structures and the formation of virtual project teams, while at the same time increasing the responsibility of each individual employee for the final result and the company's success. In contrast to classical product development processes with hierarchically rigid structures, fixed tasks and prescribed procedures, the agile approach aims to reduce bureaucracy in the product development process as well as in other PLM processes, to promote informal relationships and efficient collaboration and to act in a goal-oriented manner. The initiative, professionalism and responsibility of each individual employee are the three most important pillars of the company's success and take precedence in agile. While processes of a classical product development are mainly static and all activities and actions are predefined, process dynamics, flexibility, initiative and a strong focus on goals and customers are the strengths of agile development methods.

Agile development methods comprise a large number of iteration steps that are systematically verified and serve to increase productivity, product quality and customer satisfaction. A new successful product that meets customer expectations and quality requirements is an important benchmark for progress. What counts are not the tools, solutions, performance and fame, but the optimal processes and the fact that all planned functions, requirements and features are successfully realized in the developed product and that the product is successfully marketed and works as expected.

The agile approach has established itself as a fundamental concept of software development. Since the best methods of software development such as SE (Systems Engineering), DevOps, virtualization, software-based modeling and testing are largely transferable to the development of products with physical properties, agile product development is also purposefully applied to the development and production of material goods.

The Product Life Cycle

In the life cycle of a product, product development determines the success of the subsequent phases. A holistic life cycle approach is required for designers and developers as well as for corporate management. Permanent intensification and ad-hoc process improvements do not achieve the expected results. Only a PLM-oriented strategy, agile product development and the use of new technologies throughout the entire product lifecycle - from product development and production to marketing and operation - can ensure sustainable success.

The integration of the evaluated methods of SE, AI, the use of new PLM software and technologies, as well as the change to new flexible business models and workflows are part of the new strategy. The responsibilities and accountability of the developers should not only be focused on the product concepts and development processes, but also on the subsequent life cycle phases. To achieve this, it is necessary to adapt and change the business models, working methods and ways of thinking.

The strategy of a PLM-oriented smart product development includes smart technical products that can intelligently adapt to different conditions, as well as the use of configurable and flexible development and production systems. In perspective, the assumption is that products with individual design parameters can be developed and produced quickly. This is an important prerequisite for replacing the monopoly of the prevailing series production by Industry 4.0. Small series production, energy and time savings, avoidance of autonomous wrong decisions and harmonization of all company processes in an overall system are the goals.

The international standards ISO/IEC 15288 (Life Cycle Management - System Life Cycle Processes) and ISO/IEC 24748-2:2018-2 (Part 2: Guidelines for the application of ISO/IEC 15288) define the guidelines and processes of an approach based on the V-model. The Association of German Engineers (VDI) has published the generally applicable, industry-independent principles for the methodical development and design of technical systems and products.

Flexibility of PLM Software

The workplace of an engineer is characterized by knowledge integration and communication in all phases and processes of the product life cycle. With PLM software, the product development process is intelligent, multi-disciplinary and adaptable. The collaboration and management of standardized product data is carried out across phases and departments. Collaboration is promoted by suitable tools, methods, knowledge management, organization and high social competence. In product development, several disciplines are brought together: mechanical engineering, mechatronics, computer science and systems engineering.

The effectiveness and productivity of PLM software depends on the PLM provider, its experience, know-how and skills. The leading PLM vendors develop software products and solutions that are comprehensive and mature in terms of functionality, adaptability, technical criteria and service offerings. The software must cover and automate all areas of the company, all stages of the production chain, the product development process and all other PLM processes. The software functions as a complex distributed system and provides intelligent support for data transfer, processing and storage. To develop sustainable products, the methods used are documented and analyzed. Weaknesses in old development / production processes are identified, which have to be eliminated with new Product Lifecycle Management processes. The employees should be familiar with the PLM system. This requires internal training and further education measures (training on the job).

Various PLM providers develop software solutions that are designed for different industries, are used in different types of production and company sizes and are therefore difficult to compare with each other. This is often not due to the quality of a software, but to the specifics of development and production in the respective industry. Due to the complexity of the IT processes and architecture, the selection of a suitable software is a complex task. PLM vendors are available to advise and help with the selection, installation and configuration of the necessary PLM components. It is an advantage if the PLM vendor can provide customer references about the use of the respective PLM software product in the same industry.

Tailor-made support with PLM software

Sustainable future-oriented production requires new corporate strategies, new corporate culture and new responsibility. An industrialization of product development and the use of PLM software and new technologies lead to a paradigm shift. Traditional V-models are replaced by closed cycles. People - as employees of a company as well as customers and end users - are at the center of new development technologies. This results in a change in the product development process. In-depth IT knowledge and advanced qualifications in the use of PLM software and modeling software are required.

Not only engineers should base their working methods on PLM software, but also the functionality of PLM software should be ergonomically and functionally adapted to the developers and designers as well as to the specifics of each new product. However, the developers should not feel overwhelmed by additional information provided by the Product Lifecycle Management System. For PLM software to be effective in product development, it must be flexible, configurable and scalable, function intelligently, cover all phases and processes of PLM and automate them.

In Product Lifecycle Management, product developers and designers act as experts for controlling the development process and can perform their tasks better and faster with the help of PLM software. This increases product quality, and possible errors that only affect later phases are identified and eliminated at an early stage. Not only new technologies are crucial for sustainable production, but also new values, procedures, concepts and strategies that are consistently implemented.


Axel Schröder, "Agile Produktentwicklung: Schneller zur Innovation - erfolgreicher am Markt", ISBN 9783446458130 (2018)
VDI-Gesellschaft Produkt- und Prozessgestaltung, Handbuch "Produktentwicklung und Konstruktion", www.vdi.de