During the 1980s, the competitiveness gap between US and foreign competition became truly pervasive. Although US-based firms have regained their world market leadership in most industries, US engineering firms continue to lag Japanese and European competitors in the ability to design and manufacture technologically innovative products. Foreign competitors have not beaten US firms with high technology, but with basic design and engineering practices. In many cases, US product development efforts are too slow, too expensive, and too often fail to create products with the features, performance, and quality that customers want.

Some US firms have responded successfully to the product development challenge presented by world class competitors. The authors have studied actual successful product development case histories involving the development of complex, innovative products. These firms have combined the engineering, manufacturing, and parts purchasing functions into single teams that value the successful production of a high-value product over all other functional objectives.