Metallurgical equipment belongs to the discrete manufacturing industry, in which large-scale equipment is common, and has feature of high level of customization, large variety, single and small batch. Under the model of design to order, R&D staff have to modify or redesign according to each order, leading to longer product development cycle and higher cost. This paper presents w-model of system engineering framework to solve the R&D cross sectoral collaborative problem. Top-down functional decomposition integrated with bottom-up component clustering is suggested by the author to form module for design knowledge reuse. In the end, this paper takes an illustrative example of lean metallurgical equipment development to demonstrate the feasibility and technical advantage of the approach.