Product Development

8 Engineering Product Design and Testing

The profession of engineering uses the principles of science and mathematics to solve technical problems. However, in any engineering engagement, this also includes creativity, vision, perseverance, and compliance with federal and state laws. For example, this could include environmental regulations (e.g., air and water emissions) during the manufacturing process.

Managing the Approved Scope and Budget – Why Is This Important?

Recall that the Work Breakdown Structure (WBS) defines the scope of our project. And, Product Development can be considered a project. It is important to recognize that some firms reinvest around five to seven percent of their profits back into R&D (i.e., new product development). The author is aware of one Fortune 100 company returning 11 percent of its profits to R&D. However, the budgets for new product development are not unlimited. This can also be more significant for publicly held companies. A publicly held company is one that has its stock listed on the stock exchange (i.e., NASDAQ, NYSE, etc.). The owners of the company are the shareholders who have invested their money in the firm. Shareholders expect the value of the company to go up over time; and they generally like to see some of the profits returned to shareholders in the form of dividends (quarterly cash payouts). This is opposite privately held companies that are either family owned, or employee owned. Tables 8.1 and 8.2 indicate a few publicly ...