While it may come as no big surprise, today's business climate is more challenging than ever. Product development companies face shifting consumer demands, increased product complexity, extended supply chains and growing government regulations. Yet, despite these challenges, the best companies manage to deliver low-cost, high-quality products on time and within budget.

This begs the question, why are some companies better than others at facing the same challenges? To find an answer, the Aberdeen Group asked 148 product development companies what factors contributed to their success. The results went something like this: The least successful companies blamed external forces like the economy or supply chain for their failures, while the best companies credited internal factors like improving engineering talent and technology tools for their success.

Just take a look at this excerpt from the report:

“The difference between the best-in-class and their peers is clear, top performing companies realize success can come from within, while all others are more likely to believe it is out of their hands and depends on external forces… There are companies out there that are successful no matter what the economic climate-these are best-in-class companies. They focus internally, eliminating inefficiencies, and cultivating talent to improve the business.”

Here's what best-in-class companies do differently:

1. Eliminate process inefficiencies

Improving processes and eliminating waste are nothing new-programs like Six Sigma, Total Quality Management (TQM) and the Toyota Production System (TPS) have been around for decades. But the ideas they represent have recently found their way into software and product development. The best companies have adopted processes like Agile software and Lean product development-which have had a significant effect on their products and profit margins.

Pro tip: Adopting process improvements like Agile or Lean can make a big difference in your company's efficiency.

2. Cultivate and develop talent

In its survey, Aberdeen Group found that a shortage of skilled employees was responsible for a surprising 16 percent increase in missed deadlines and an 11 percent increase in costs. This shortage also had a similar impact on quality and profits. The best companies understand that qualified engineers and other employees play a critical role in staying competitive and delivering successful products. These companies invest in employees with training to keep their skills current.

Pro tip: Access to online training can help keep your employee's skills up to date and your projects on track.

3. Invest in the right tools

When asked how technology tools (like systems engineering, embedded software or PCB design) affect business, best-in-class companies were twice as likely to say these tools have a significant impact on their success. What's more, adopting technology tools increased the benefits from process improvements and employee training. According to the report, technology is the catalyst for reaching “the pinnacle of product development-it is not possible without these tools.”

Pro tip: Ask your staff what tools or technology would save them time and effort on their projects, and then give them what they need.

Takeaway

Succeeding in the software and product development world is only getting harder. Increased competition has forced companies to speed up innovation cycles, launch new products faster and price them more competitively. But the most successful companies are finding ways to improve by cultivating their people and providing the tools they need to drive success.

How are you using new technology tools or employee training to improve your business and drive results? Tell us in the comments.