Proper understanding of customers’ needs is of great importance in developing strategy for a technical system development. Current description of those needs is based on customers’ opinions and experience. This description rarely resembles parameters of the system-to-be-developed that are changing in time. The aim of this study was to develop a method for useful function identification that will take into account evolution of not only a technical system, but also customers’ needs. This approach consists of problem identification in the context of an expected outcome in order to identify customers’ needs in the form of evaluation parameters. Those parameters are further analyzed to define required functions of the system-to-be-developed by means of functional analysis. During the study, such TRIZ tools like Function Analysis and System Operator were implemented to model useful functions and context of development of technical system. Innovation Assessment methodology was applied to assess obtained results of the study. Application of proposed method of identification of useful functions during technical system development makes it possible to create product development strategies that take into account evolving needs of customers at early design stages. This allows reduction of R&D costs and resources usage in the design process.