Understanding and applying design-to-cost: Basics, tools and current developments

In a highly competitive world, it is not enough to simply develop technically excellent products. The price often determines market success. This is precisely where the design-to-cost concept comes in. It aims to actively influence costs as early as the development process - without compromising on quality or functionality.

What does design-to-cost mean?

Design-to-Cost (DtC) is a strategic methodology in product development. It ensures that cost targets are just as important as technical requirements. Instead of controlling costs at the end, they are incorporated into design decisions right from the start.

DtC means:

- Early definition of cost targets

- Interdisciplinary cooperation (purchasing, development, controlling)

- Cost-benefit considerations for every design decision

Tools and methods in use

Various tools and methods are used to implement design-to-cost:

- Target costing: Derivation of target costs from market prices and desired profit margins.

- Value Analysis / Value Engineering: Systematic analysis to reduce costs without sacrificing quality.

- Cost workshops: Joint evaluation of components, processes and alternatives.

- Digital simulation tools: Preliminary testing of material selection, production processes and life cycle costs.

With modern software solutions, development, material and production costs can be simulated in real time. This enables well-founded decisions and reduces the risk of expensive design corrections.

Current trends and developments

Digital transformation and sustainability are also changing design-to-cost:

- Artificial intelligence (AI): AI-supported analyses forecast costs and identify optimization potential.

- Sustainable materials: DtC expands to "Design-to-Cost & Eco" to integrate environmental costs.

- Platform economy: Standardized components across product lines significantly reduce costs.

Companies that consistently integrate design-to-cost not only strengthen their competitiveness, but also shorten development times and reduce resource consumption.

Conclusion

Understanding design-to-cost means placing cost-effectiveness at the center of product development - right from the start. With the right tools and a clear focus, an abstract cost idea becomes a practical instrument for success. Those who adapt to the principles and new trends will secure decisive advantages in global competition.

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