herausragend
outstanding
Far above average; excellent, exceptional, or remarkable.
Die Wissenschaftlerin wurde für ihre herausragende Forschungsarbeit ausgezeichnet.
The scientist received an award for her outstanding research work.

outstanding / protruding
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outstanding
Far above average; excellent, exceptional, or remarkable.
Die Wissenschaftlerin wurde für ihre herausragende Forschungsarbeit ausgezeichnet.
The scientist received an award for her outstanding research work.

'Herausragend' is the present participle of the verb 'herausragen' (to stick/project out of something). This literal meaning of 'sticking out' is transferred to the figurative meaning 'excellent'—someone or something stands out from the crowd.
Seine Fähigkeiten als Pianist sind wirklich herausragend.
His abilities as a pianist are truly outstanding.
This adjective is strong praise and is often used in formal contexts such as job references, reviews, or award ceremonies. It is significantly stronger and more formal than 'gut' (good) or 'sehr gut' (very good).
Das Komitee lobte ihre herausragende Leistung im Projekt.
The committee praised her outstanding performance in the project.
'Herausragend' (outstanding) often describes abstract nouns such as 'Leistung' (performance/achievement), 'Qualität' (quality), 'Bedeutung' (importance), 'Talent' (talent), or the qualities of people such as 'Wissenschaftler' (scientist) or 'Künstler' (artist).
Er ist ein herausragender Experte auf seinem Gebiet.
He is an outstanding expert in his field.
The meaning is usually clear from context: if the word describes a physical object (e.g. a rock, a building), it is meant literally. If it describes an ability, performance, or quality, it means 'exzellent' (excellent) in the figurative sense.
Der herausragende Turm der Burg ist schon von Weitem sichtbar.
The protruding tower of the castle is visible from far away.
average
'durchschnittlich' and 'herausragend' both describe how good or noticeable something is. 'durchschnittlich' means that something is average and roughly matches the usual level. 'herausragend' means that something is clearly better than normal. You use 'durchschnittlich' when you do not want to emphasize any special strength. 'herausragend' fits when a performance, result, or quality really stands out.

Frau Müller hat für ihr herausragendes Projekt einen Preis bekommen.
Ms. Müller received a prize for her outstanding project.
Seine Prüfung war durchschnittlich, deshalb war er weder sehr zufrieden noch enttäuscht.
His exam was average, so he was neither very satisfied nor disappointed.