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Applying Agile Methodologies to Hardware Product Development 

Agile Hardware Product DevelopmentDo your products seem to miss the mark on innovation?

If you answered “yes,” then agile product development may be a good fit for your business.

Today, manufacturers are constantly revisiting their new product development (NPD) strategy to address fluctuating market conditions and gain a lead on the competition. With ongoing supply chain disruptions, evolving regulatory requirements, and increasing consumer demand for more personalized products, companies must drive greater flexibility and transparency throughout the NPD process to minimize risks and achieve commercialization success. The adoption of agile product development practices enables manufacturers to keep pace with innovation and deliver products that meet customers’ ever-changing needs.


Traditionally, product development has been broken down into linear or sequential phases, commonly known as Waterfall. Using this methodology, a new phase cannot begin until the previous one ends with sign-off and approval. Different teams are often assigned to different phases throughout the product development process.

This rigid, siloed approach works well if you are designing products with simple hardware components and the project requirements and milestones are clearly defined from the beginning. However, today’s environment is in constant flux. Furthermore, product designs are much more complex—integrating mechanical, electrical, and software elements as well as the Internet of Things (IoT), sensors, artificial intelligence (AI), and other advanced technologies. These products require feedback from key stakeholders and end users at every phase to ensure that they deliver the greatest value. To compound matters, companies are outsourcing a significant portion of their design and production work to contract manufacturers, multitiered suppliers, and other external partners for greater product differentiation.

The Waterfall method fails to address this new way of working and factor in the many unknowns that come with getting highly sophisticated products to market within shorter NPD cycles. More likely than not, unexpected issues or new information will arise and impact the design of the product. Whether it be an unforeseen part shortage or customers’ desire for different hardware functionality, organizations need the flexibility to quickly change course throughout the entire concept-to-production process.

To compensate for the shortcomings of Waterfall, a team of software developers created the Agile Manifesto which provides principles to help guide organizations in adopting more agile product development practices1:

12 Principles Behind the Agile Manifesto

  1. Satisfy customers through early and continuous delivery of valuable products
  2. Welcome changing requirements
  3. Deliver working products frequently
  4. Encourage regular communication across teams
  5. Create an environment that motivates teams to get the job done
  6. Conduct face-to-face conversations whenever possible to convey information efficiently and effectively
  7. Use working versions of the final product to measure progress
  8. Drive sustainable product development by breaking down processes into small and achievable milestones
  9. Pay attention to technical excellence and good design
  10. Simplify your work
  11. Rely on self-organizing teams to create the best product design
  12. Regularly review and identify areas for process improvement, then adjust accordingly

Rapid Design Iterations

Based on these principles, agile methodology utilizes rapid design iterations or “sprints” to respond quickly to change throughout the NPD process and deliver products that meet customers’ expectations. Unlike the traditional Waterfall method, team members work in parallel and collaborate frequently throughout each iteration to make incremental design enhancements and release them for assessment. There’s a continuous feedback loop between product teams, contract manufacturers, suppliers, customers, and other key stakeholders which drives better decision-making throughout each phase. The goal is to produce a finished product that resonates with current market conditions and makes the biggest impact.


Although the agile methodology was originally intended for software, more and more organizations are realizing the benefits of applying it to hardware product development. Core principles are the same for both digital and physical products; however, some modifications are needed to address the unique challenges of hardware development.

The key elements of agile product development for hardware include:

  • Rapid Experimentation
    Through open communication, internal product team members and external partners regularly exchange new design ideas and experiment in the early concept phase to ensure that they pinpoint the actual market need. By leveraging technologies like additive manufacturing and 3D printing, they can quickly release physical prototypes for customer validation with each iteration. As part of the prototype release, teams determine:

    • What type of functionality and/or physical attributes should be incorporated
    • What key questions need to be answered by the customer to gain valuable insights

    During this discovery exercise, the goal is to be receptive to new findings and not start crafting product requirements until adequate customer input is gathered and analyzed.

  • Planning
    Teams identify and prepare for the possible unknowns and risks that are imminent over the course of the project. This includes developing a sourcing strategy to mitigate part shortages and other supply chain shocks. At this point, they start to formulate high-level product attributes that will eventually translate into specific requirements and features. A prioritized list of engineering and design tasks (i.e., product backlog) is also developed to ensure everyone stays on track.
  • Multidisciplinary Teams
    Iterations run more efficiently when small cross-functional teams work concurrently to complete various tasks. The team is typically comprised of a product manager, project manager, engineers, functional leads (e.g., quality, procurement, operations), and external partners. Having full representation from these key disciplines throughout the entire project helps organizations stay abreast of design for manufacturability (DFM) mistakes, part delays, cost overruns, and other issues which could negatively impact the product.


With frequent collaboration and planning at the core of agile hardware development, cloud-native product lifecycle management (PLM) and quality management system (QMS) solutions provide a single source of truth for internal teams and external partners to access the latest product information and work in real time throughout the entire NPD process. Because product designs (i.e., mechanical, electrical, and software), assemblies, parts, requirements, quality information, and project tasks are linked together, everyone stays on track with completing key deliverables and has full visibility into any issues that warrant changes early in the iteration cycle. With a seamless connection to CAD, engineers can push updated designs to downstream team members for review. In turn, they can work in parallel to fine-tune certain features and quickly deliver the next release.

To learn more about how cloud-native solutions drive more agile product development processes, visit our resource page.


Agile Alliance. The 12 Principles Behind the Agile Manifesto.