A recent trend in powertrain development organisations has been to apply processes historically associated with manufacturing. The aim is to capitalise on the resulting productivity gains to contain the increasing test demand necessary to develop current and future product. Significant obstacles to the implementation of manufacturing derived methods include the lack of clarity of the engineering test requirements and existing working practices in the product development environment.The System Optimisation Approach has been presented in previous work as a potential solution . As an extension, this paper introduces a new concept closely related to the established manufacturing principle of Process Capability (Cp). Application of the resulting method quantifies the test facility’s capability to provide a test result subject to a specified statistical confidence within a certain number of test repeats. In addition the process provides objective direction when an engineering target is unspecified or deemed unachievable.As a generic, data-driven method the Capability Assessment Process is a tool to objectively reduce test effort whilst retaining sufficient confidence in test results and conclusions. On a wider scale, the process directly links engineering targets to potential facility investment.