Target costing drives a product development strategy that focuses the design team on the ultimate customer and on the real opportunity in the market. Leading Japanese electronics and vehicle manufacturers have used target costing to their advantage, and companies are now introducing it in the United States, Germany, and elsewhere. Its rigorous cost-management technique helps prevent senior managers from launching low-margin products that do not generate appropriate returns to the company, hut its greater value lies in its ability to bring the challenge of the marketplace back through the chain of production to product designers. Target costing ensures that development teams will bring profitable products to market not only with the right level of quality and functionality but also with appropriate prices for the targeted customer segments. It is a discipline that harmonizes the labor of disparate participants in the development effort, from designers and manufacturing engineers to market researchers and suppliers.