Abstract: On the base of analyzing the time features of competition in manufacturing, a proposition on modern design theory and methodology is suggested. Several Internet-based collaborative design projects are practicing by a group in China. Theoretical investigation is carried out concurrently and presented. It is clear that existed results of design theory dealt with only pieces of the topic in design and cannot control a whole design process, especially in front of the daily increasing pressure on product innovation from market and the trend of intelligent resource varying from a vertical structure to a horizontal structure. The results of investigation show that modern design theory is in principle consisted of four parts: theory of the design process, theory of performance needs driving, theory of knowledge flow and theory of working in line between stakeholders. The basic frameworks for the theories are introduced and possible methods relative to the theories are discussed. Besides parts of the first two, most contents of the theories have not been studies or are just been recognized. Therefore there is a very wide space, in which the modern design theory and methodology can be developed. It is argued that good design methods can be studied and established only under the guide of perfect theories, and good design tools (including software) must be studied and developed only for realizing the good design methods. Those viewpoints considering that advanced software can be developed independent with the study of modern design theory and methodology cannot be accepted. Tools produced under the guide of theory and methodology out of date will be of low efficiency or sometimes become the obstacles of advancement of design.

Key words: Design theory and methodology, Knowledge flow, Modern design, Performance needs