There are 3 major methods of testing which are dictated by practical issues:
In-circuit testing
This means we are testing the output of a component while operational. For example:
Check the voltage at the hoist brake terminal while the hoist command is being given
Check the hydraulic pressure at the output of the spreader hydraulic motor while it is running
The benefit of doing in-circuit testing, is that if the test passes, the good output propagates back through the component and all items supporting it.