At this time of the year, many companies assess product roadmaps, define projects and schedules, allocate resources, and assign budgets for the upcoming year. Since managers and project teams will be held accountable to working within these constraints, it is important to fully understand the many factors of developing an electronic product and account for them during the planning phase.

The following identify the major considerations for planning the design and development of a custom electronic device, with a focus on setting realistic expectations for cost, schedule, and risk.

Product Requirements Definition

When conceptualizing a new product, defining its requirements is obviously the first step. The product concept sets scope and directly impacts cost and schedule. Important considerations include:

  • Use cases: How a product is utilized by the end customer is critical. This goes beyond hard features like specifying a microprocessor or number of USB interfaces. Use cases focus on things like: How long must the battery last between charges? What operations are most critical, and what can be turned off if needed? Will the product be used in harsh environments? Use case definition is critical to defining requirements and assuring the product will meet user needs.
  • Requirements: In addition to use cases, the hard requirements define the product. This includes things like electronics (e.g. ARM processor, USB, Wi-Fi, Bluetooth, GPS), software (e.g. operating system like Linux, Android, or RTOS), user interface (display, touchscreen, buttons, or switches), packaging (including look/feel), ruggedness, and more.
  • Product life span: The length of time the product must be manufactured and supported for repair is critical. Some parts, such as certain types of microprocessors and displays, are often manufactured at very high volumes for short periods of time (perhaps up to two years) and then become unavailable. Other microprocessors and displays are available for much longer periods of time, perhaps 5 to 10 years or more. Knowing the product life span upfront directly impacts part selection, design effort, supply chain stability, and product sell price.
  • Assign priorities: Priorities must be identified for use cases and feature sets so that compromises regarding costing, scheduling, and features can be traded off to comply with development budgets, market window, and product price points.
  • Product Sell Price and Profit Targets: Ultimately, the success of a product depends on the ability to manufacture and sell it at a profit. Businesses typically have return on investment or profitability metrics. These, in turn, impact the target sell price of the product. The target sell price and profit margin help set limits on the development and manufacturing costs of the product. Knowing these up-front assists in scoping a design approach, feature set, and component selection.

Engineering Development Costs

With product requirements defined, the engineering development costs, often called non-recurring engineering costs, or NRE, can be estimated. NRE is a combination of internal labor, subcontract, and materials costs. For custom electronic designs, some of these costs are obvious while others may be hidden or overlooked. The following outline major NRE considerations.

  • Engineering design labor: The design complexity of an electronic product is not necessarily proportional to the number of features listed. It is a function of the complexity to implement these features, the extent to which previously developed intellectual property can be leveraged, and the competencies of the engineering team. There is also effort introduced by standard process. Accurate labor predictions depends on honest assessments by the engineering team in combination with knowledgeable managers.
  • Consider outsourcing: Outsourcing electronic product development can be very cost, schedule, and risk effective. Major reasons to outsource development include a current lack of internal resource availability or a need to leverage expertise. Electronic design is a broad area; with many niche areas of expertise. Examples include the design of battery operated devices, portable electronic devices, and rugged devices that can withstand harsh environments. Successful design of such electronics devices requires a combination of embedded processor design expertise, operating system development and modification (such as Android, Linux, or real time operating system (RTOS)), enclosure design, thermal management, specification of display and touch screen components, and the systems level expertise to optimize design decisions competing for space, limited power budgets, ruggedness, components costs, and long term availability. Design firms with this expertise develop a sound and robust product while minimizing cost, schedule, and risk. Keeping a design internal without the appropriate level of expertise adds significant risk, cost, and time.
  • Contact third party partners and vendors for preliminary quotes: Establish the qualifications and capabilities of various firms and obtain Rough Order of Magnitude (ROM) quotes based on requirements, even if bullet points.
  • Prototype costs: Electronic products often require at least two build iterations to perfect the design and resolve any issues. Prototype costs can be surprisingly high, but must factor in higher per-unit materials costs purchased in low quantities, as well as any tooling for other one time engineering charges associated with custom components.

Product Development Schedules

Engineering development schedules inherently have a certain amount of risk, but may be predicted through experience and established sets of processes and practices. In defining a schedule, engineering labor, subcontract execution, and materials procurement through the supply chain must be included.

  • Engineering labor: This includes the time required to finalize requirements, conceptualize the product architecture, implement the design, and subsequently build, debug, test, and deploy. These time frames are typically estimated by experts in the field based on their experience or research. Time frames may be compressed or lengthened, depending on the number of engineers that can be simultaneously assigned to product development.
  • Subcontract execution: Subcontracts are often critical in the acquisition of a service or high value component required in a product design. The need for a subcontract should be identified as early as possible for proper budget and schedule estimation.
  • Materials procurement: The acquisition of materials, such as electronic components or mechanical piece-parts, requires time. Some parts may be stocked as commercial off-the-shelf (COTS) items at distributors, with lead times on the order of days. Other parts may not have sufficient stock, either because a high quantity is required, parts are on allocation due to supply chain constraints (such as DRAM and flash memories are today), or because a custom part is being designed and produced. It is important for the program manager to factor in long lead time items, which often set the critical path, in developing the schedule to properly set expectations. Schedules for custom parts can sometimes be compressed through the payment of additional expedite fees, which obviously impacts project budget.

Regulatory Certification

Prior to sale, an electronic product must meet all relevant regulatory certifications. Examples include electromagnetic compliance (such as FCC Part 15 within the United States, CE within Europe, or IC within Canada), Underwriter Labs (UL) compliance for safety, FDA for medical devices, cellular carrier certifications (PTCRB or GFC), MIL-STD-461 and MIL-STD-810 for military devices and tablets, ATEX for intrinsically safe devices used in explosive environments, and more. Planning for certification success includes:

  • Identifying the certifications required for the product given its use cases, constituent functions, and industries of sale.
  • Contacting certified test labs for a rough quote, including costs and time required to complete test plans, testing, reporting, and filing paperwork as needed.
  • Identifying required support for testing, including prototype test units, test fixtures, or test modes. Budget and schedule these items in the project plan.

Planning for Production

It is crucial to plan for product manufacturing early in the project. Unit volumes, supply chain, the manufacturing process itself, and more all impact the planning and design of the custom electronic product. Considerations include

  • Make vs buy: The first major decision is whether to manufacture the product in-house or outsource. In-house production makes sense if the company owns the design (especially critical intellectual property), has appropriate infrastructure, and the cost of goods sold (COGS) enables the firm to make the desired profit. Outsourcing production often is a lower cost alternative, as manufacturers can often amortize overhead costs across a broad range of product, can aggregate purchases of components and raw materials across multiple product lines to achieve economies of scale, and leverage core competencies in the production process.
  • Production test: The test of product during the manufacturing process is important to prevent deficient product from being shipped and to flag any manufacturing process problems early. Features for production test must be designed into electronic products up-front, including physical test points on the circuit board, diagnostic ports, and software support.
  • Establish supply chain: As discussed above, establishing a reliable supply chain is crucial to being able to reliably manufacture a product on time, for acceptable cost, and with acceptable quality over a period of years. In short, planning the supply chain impacts product design.
  • Lifecycle management: The electronic product lifecycle can be complex, as components are revised in some form, become obsolete, and even have periods of supply constraints. Processes for receiving, evaluating and acting upon Part Change Notices (PCNs), Engineering Change Notices (ECNs), and End of Life (EOL) notifications are crucial to ongoing production.


All plans are subject to risk, since it is impossible to precisely foresee how events will unfold, new products usually incorporate new technology that is in development, and not every contingency can realistically be foreseen. Risk planning is a standard program management technique and can include the following:

  • Add management reserve in both the budget and schedule to allow for delays, under-estimations, and unforeseen circumstances.
  • Perform low cost, rapid turn prototypes before committing to longer term, higher priced designs.


The design of an electronic product, whether a rugged military tablet, portable medical device, or an industrial handheld is a complex undertaking. A number of engineering disciplines are required – hardware, software, mechanical, and systems – with the appropriate skill sets, experience, and processes required to deliver a working product within a myriad of technical and business constraints. Budgets and schedule are driven by the requirements and the knowledge to execute efficiently. A successful product development plan optimizes requirements, development costs, scheduling, risk, technical capabilities, time to market, and more.

InHand Electronics excels as an industry-leading provider of embedded circuitry, single board computers, packaged products, and software to original equipment manufacturers of rugged handheld devices, tablets, and other electronic products. Contact InHand for an evaluation of your application.