A subsea crane is normally mounted on a floating vessel and equipped with a winch system. The crane can operate in water down to 3000 m. The vessel tends to move up and down due to waves. This heave motion makes offshore lifting operations challenging. In order to ease the winch operation in rough sea, the winch can be equipped with additional systems like active heave compensation and constant tension. In active heave compensation and constant tension system, both motion and force control of the winch are important. This paper presents a digital displacement winch drive system and gives a description of challenges related to subsea lifting operations. The operation challenges are used to design a set of test cases for evaluating the performance of the digital displacement winch drive system.