Engineering Management

Chapter 1-6 Reviewer

Engineers in various types of
organization

Chapter 1 Minimal engineering

Level One
jobs; retail firms
Engineer’s Role Moderate degree of
 Task Variety engineering job;
Level Two
transportation
 Skill Development
company
 People based skills High degree of
Development by Engineers Level Three engineering job;
construction firm
Period Development
6000 – 3000
Stone bladed axe Engineering Management – activity
B.C
3000 – 600 B.C Pyramids of Egypt combining technical knowledge
600 B.C – 400 Roman’s with the ability to organize and
A.D roadbuilding
coordinate worker power,
Paper and
100 – 1600 A.D materials, machinery, and money.
gunpowder
Steam engine and
1601- 1799 A.D weaving
machinery
Management – creative problem
Cars and
Modern Times household solving process of planning,
appliances organizing, leading, and controlling
an organization’s resources to
achieve its mission and objectives.
Functions of Engineer

 Food Production
 Pollution Elimination Requirement for the engineer
 Waste Management manager’s job
 Noise Reduction
 Bachelor’s degree; Master’s
 Energy Production
degree in some cases.
 Mobility
 Few experiences in pure
 Crime Prevention
engineering job.
 Communication
 Training in supervision.
Functions of Engineering  Special training in
engineering management.
 Research
 Design and Development
 Testing
How one may become a
 Manufacturing
successful engineer
 Construction
 Sales  Ability
 Consulting  Motivation to manage
 Government  Opportunity
 Teaching
 Management
Ability – capacity of an engineering
manager to achieve organizational
objectives effectively and Internal Limitations in Environment
efficiently.
 Limited funds
Effectiveness – whether objectives  Limited training
are accomplished (Higgins).  Ill designed facilities

Efficiency – description of the External Environment – variables

relative amount of resources used that are outside the organization
in obtaining effectiveness and not typically within the short-
(Higgins). run control f top management.

External Limitations in Environment

Chapter 2  Patents
 Limited market
Decision-Making – the process of
 Strict enforcement of
identifying and choosing
regulations
alternative courses of action in a
manner appropriate to the
demands of the situation.
Choice-making – process of
selecting among alternatives
representing potential solution to a
The decision-making process
problem.
1. Diagnose a problem
Implementation – carrying out the
2. Analyze environment
decision so that the objectives
3. Articulate problem or
sought will be achieved.
opportunity
4. Develop viable alternatives Feedback – process which requires
5. Evaluate alternative checking at each stage of the
6. Make a choice process to assure that the
7. Implement decision alternatives generated, the criteria
8. Evaluate and adapt results used in evaluation, and the solution
selected for implementation are in
keeping with the goals and
Problem – when there is a objectives originally specified.
difference between an actual
Control – actions made to ensure
situation and desired situation.
that activities performed match the
Environment – plays a significant desired activities or goals, that
role in success or failure of an have been set.
organization.

Approaches in solving
Components of Environment problems

Internal Environment – Qualitative Evaluation – evaluation

organizational activities within a of alternatives using intuition and
firm that surrounds decision- subjective judgement
making.
Quantitative Evaluation –
e.g. organizational, marketing, evaluation of alternatives using any
personnel, production, financial.
technique in a group classified as Linear Programming – used to
rational and analytical. produce an optimum solution
within bounds imposed by
constraints upon decisions.
Quantitative Model for Decision
Sampling Theory – samples of
Making
population are statistically
Inventory Model – helps engineer determined to be used for a
manager make decision regarding number of processes.
inventory.
Statistical Decision Theory –
 Economic Order Quantitative rational way to conceptualize,
Model – minimize total yearly analyze, and solve problems in
cost. situations involving limited
 Production Order Quantity information about decision making.
Model – applied to production
Bayesian Analysis – revise and
orders.
assess initial assessment of the
 Back Order Inventory Model –
event probabilities generated by
used for planned shortages.
alternative solutions.
 Quantity Discount Model -
minimize total cost when
discounts are offered.
Chapter 3
Queueing Theory – determine the
Planning
number of service units that will
minimize both customers waiting - Management function that
time and cost of service. involves anticipating future
trends and determining the
Network Models – large complex
best strategies and tactics to
tasks are broken into smaller
achieve organizational
segments that can be managed
objectives ( Nickels).
independently.
- Selection of sequential
 The Program Evaluation ordering of tasks required to
Review Technique (PERT) – achieve an organizational
three-time estimates for each goal (Aldag and Stearns).
activity. - Deciding what will be done,
 The Critical Path Method who will do it, where, when,
(CPM) – one time factor per and how it will be done, and
activity. the standards to which it will
be done (Cole and Hamilton).
Forecasting – the collection of past
- Selecting the best course of
and current information to make
action so that desired result
predictions about future.
is achieved.
Regression Analysis – forecasting
method that examines association
between two or more variables. Planning at Various
Management Level
Simulation – constructed to
represent reality, on which Top Management Strategic
conclusions about real life Level planning
Middle Intermediate
problems can be used.
Management
planning
Functional Area Plans
Level
Lower Implementing and
Operational Marketing controlling an
Management
planning Plan organization’s
Level
marketing activities
The quantity of
Strategic Planning – process of output a company
Production
determining the major goals of the must produce in
Plan
broad terms and by
organization and the policies and product family
strategies for obtaining and using Summarizes the
resources to achieve goals. Financial Plan current financial
situation of the firm
Intermediate Planning – process of Indicates human
Human
determining the contributions that resources needs of
Resources
a company in terms
subunits can make with allocated Management
of quantity and
resources. Plan
quality
Operational planning – process of
determining how specific tasks can
best be accomplished on time with
available resources.

The Planning Process

Plans with Time Horizon
1. Setting organizational,
divisional, or unit goals. Plans intended to
2. Developing strategies or Short Range cover a period of
tactics to reach those goals Plans less than one
year
3. Determining resources Plans covering a
needed Longe Range time span of
4. Setting standards Plans more than one
year

Goals – precise statement of result Plans according to Frequency of

sought, quantified in time and Use
magnitude, where possible.
Standing Plan – plans used again
Strategy – a course of action aimed and again, focused on situations
at ensuring that the organization that recur repeatedly.
will achieve its objectives.
Broad regulations and
Tactic – short-term action taken by Policies guidelines to aid
managers
management to adjust negative
Procedure Describe the exact series
internal or external influences. s of actions
Require or forbid a certain
Standards – a quantitative or Rules
action
qualitative measuring device
designed to help monitor the
performances of people, capital Single Use Plan – specifically
goods, or processes developed to implement courses of
action that are relatively unique
and are unlikely to be repeated.
Types of Plans Budgets Plan which sets forth the
 projected expenditure for  Plans for Recruitment and
a certain activity and
explains where the funds
Selection
will come from  Training Plan
Designed to coordinate a  Retirement Plan
Programs large set of activities
Plan that is usually more
limited in scope than a
Projects program and is sometimes Parts of Strategic Planning
prepared to support a
program  Company or Corporate
Missions
Contents of Marketing Plan  Objectives or Goals
 Strategies
 Executive Summary – overall
view of marketing project and
its potential.
Company Mission – strategic
 Table of Contents
statement that identifies why an
 Situational Analysis and
organization exists, its philosophy
Target Market
of management, and its purpose as
 Marketing Objectives and
distinguished from other similar
Goals
organizations in terms of products,
 Marketing Strategies
services, and markets.
 Marketing Tactics
 Schedules and Budgets
 Financial Data and Control

Contents of Production Plan

 Amount of capacity the

Making Planning Effective
company must have
 How many employees are Planning Barriers
required
 Manager’s inability to plan
 How much material must be
 Improper planning process
purchased
 Lack of commitment to
planning process
 Improper information
Contents of Financial Plan
 Focusing on the present at
 Analysis of the firm’s expense of future
financial condition  Too much reliance on
 Sales Forecast planning department
 Capital Budget  Concentrating on only
 Cash Budget controllable variables
 Set of pro forma (or
Aids to planning
projected) financial
statements  Gather as much information
 External financing plan as possible
 Develop multiple sources of
information
Contents of Human Resources  Involve others in planning
Plan process

 Personnel Requirement
Chapter 4 in one functional activity
is grouped into one unit.
Organizing – the structuring of the organization of a
Product or company by divisions that
resources and activities to Market brings together all those
accomplish objectives in an Organizatio individuals with a certain
efficient and effective manner. n type of product or
customer
each employee reports to
Matrix both a functional or
Concerns on structuring Organizatio divisional manager and to
n a project or group
determining the scope manager.
Division of
of work and how it is
Labor
combined in a job.
process of assigning Types of Authority
various degrees of
Delegation of Manager’s right to tell
decision-making Line
Authority subordinates what to do
authority to Authority
subordinate. and see that they do it
grouping of related A staff’s specialist right
Staff
Departmentati jobs, activities, or to give advice to
Authority
on processes into major superior
organizational subunits. A specialist’s right to
number of people who oversee lower level
Span of Functional personnel involved in
report directly to a
Control Authority that specialty, regardless
given manager.
linking of activities in of where the personnel
the organization that are in the organization.
Coordination
achieve a common
goal.
Classification of Staff Officers
Individuals assigned to
a specific manager to
Personal Staff
Formal Organization – structure provide needed staff
services
that details lines of responsibilities, Individuals providing
Specialized
authority, and position. Staff
needed staff service for
the whole organization
diagram of organization’s Committee – formal group of
Organizatio
official positions and
nal Chart
formal lines of authority. persons formed for a specific
provides written purpose.
descriptions of authority
Organizatio relationships, details the Created for short term
Ad hoc
nal Manual functions of major purposes and have limited
Committee
organizational units, and life
describes job procedures. Relatively permanent
Policy personnel activities and Standing committee that deal with
Manual company policies. Committee issues on an ongoing
basis

Informal Group – spontaneously

formed with the principal reason of Chapter 5
belongingness. Staffing – the management
function that determines human
resources needs, recruits, selects,
Types of Organizational trains, and develop human
Structure resources for jobs created by the
Functional form of organization.
Organizatio departmentalization in
n which everyone engaged
The Staffing Procedure Three Major Types of Explanatory
Models
 Human resources planning
 Recruitment Regression
Examines association
between two or more
 Selection Model
variables.
 Induction and Orientation Estimated from past time
 Training and Development series data and used to
Econometri show the effect of various
 Performance Appraisal c Model independent variables on
 Employment Decision various dependent
 Separation variables
Leading Anticipate business cycle
Indicator turn

Human Resources Planning

Recruitment – attracting qualified
Activities
persons to apply for vacant
Assessment of future positions in the company so that
human resource needs in
Forecasting relation to the current those who are best suited to serve
capabilities of the the company may be selected.
organization
Translating the Source of Applicants
forecasted human
Programmin
g
resource needs to  Organization’s current
personnel objectives and
employees
goals
Monitoring human  Newspaper advertising
Evaluation resource action plans  Schools
and Control and evaluating their
success  Referrals from employees
 Recruitment firms
 Competitors

Selection – act of choosing from

those that are available the
individuals most likely to succeed
on the job.

Methods of Forecasting
Use historical data to
Time Series
develop forecasts for the Ways of Determining the
Method
future
Attempts to identify the Qualifications of a Job Candidate
major variables that are
Provides information
Explanatory, related to past Application
about a person’s
or Causal conditions and then use Blanks
characteristics.
Models current measures of
these variables to Written by previous
predict the future employers, co-workers,
References
teachers, club officers,
Provide early warning
etc.
signals of significant
changes in established Gathered in an interview
Monitoring patterns and relationship by asking a series of
Interviews
Method so that the engineer relevant questions to the
manager can assess the job candidate
likely impact and plan Involves evaluation of the
responses if required future behavior or
Testing
performance of an
individual
 workplace
Combination of on-the-
Type of Test job training and
Apprenticeshi experience with
An objective, standard p Program classroom instruction in
Psychologic particular subjects are
measure of a sample
al Test provided to trainees
behavior
Physical Given to assess the Provide more emphasis
Special
Examinatio physical health of an on education rather
Courses
n applicant than training

Types of Psychological Test Training Program for Managers

Aptitude
Used to measure a (Decision-Making Skills)
person’s capacity or
test
potential ability to learn Trainee is provided with a
Used to measure a set of notes, messages,
Performan
person’s current In-Basket telephone calls, etc. all
ce test
knowledge of a subject pertaining to a certain
Used to measure company situation
Personality personality traits as Trainees are faced with
test dominance, sociability, and simulated situation and
conformity Manageme are required to make an
Used to measure a nt Games ongoing series of
Interest decisions about the
person’s interest in various
Test situation
fields of work.
Presents actual situations
in organizations and
Case
Induction – employee is provided enable one to examine
Studies
successful and
with the necessary information unsuccessful operations.
about the company.

Orientation – employee is (Interpersonal Competence)

introduced to the immediate
Trainees are assigned
working environment and co- Role
roles to play in a given
Playing
workers. case incident
Attempts to influence the
Training – learning that is provided Behavior
trainee by showing model
persons behaving
in order to improve performance on Modeling
effectively in a problem
the present job. situation
Awareness and sensitivity
Sensitivity to behavioral patterns of
Training oneself and others are
developed
Intended to help
individuals not only
understand themselves
Transaction
and others but also
al Analysis
improve their
interpersonal
communication skills
Training Programs for Non-
Managers
Trainee is placed in an
actual work situation
On-the-job-
under the direction of
training
his immediate
supervisor
Vestibule Trainee is placed in a (Acquiring Knowledge)
School situation almost exactly
the same as the On-the- To learn various skills while
job
actually engaged in the
Experienc
performance of a job
e Employment Decision
Requires a senior manager
to assist a senior manager Given to employees whose
to assist a lower level Monetary performance is at par or
Coaching
manager by teaching him Rewards above standard
the needed skills and requirements
advices. Movement by a person into
Manager works as assistant a position of higher pay and
to a higher level manager Promotion
greater responsibilities
Understud and participates in planning s
which is given as a reward
y and other managerial for competence
functions until he is ready Movement of a person to a
to assume such position different job at same or
Transfer similar level of
responsibility in the
(Increase Trainee’s Knowledge) organization
Movement from one
The manager is given position to one another
Position Demotion
assignments in a variety of which has less pay or
Rotation
departments responsibility attached to it.
Premised on the idea that
Multiple junior executives must be
Manageme provided with means to Separation – a voluntary or
nt prepare them for higher
management positions
involuntary termination of an
employee.

Ways of Appraising Performance

Each trait or characteristics Chapter 6
to be rated by a line or scale
Rating Scale
which the rater indicates the Communication - a process of
Method
degree the individual sharing information through
possesses the trait
Evaluator composes symbols, including words and
Essay statements the best messages.
Method describes the person
evaluated
Management
Specific goals are set
by
collaboratively for the Forms of Communication
Objectives
organization as a whole
Method Information provided
Assessment One is evaluated by persons through communication
Informatio
Center other than the immediate may be used for decision
n Function
Method superior making at various work
The evaluator checks levels in organization
statements on a list that are Oftentimes used as a
Checklist
deemed to characterize an means to motivate
Method Motivation
employee’s behavior or employees to commit
Function
performance themselves to
Standards are set for the organization’s objectives
Work
realistic worker output and Control When properly
Standards
later on used in evaluating Function communicated
Method
performance Feelings are repressed in
Emotive
Ranking Arranges employees in rank the organization which
Function
Method order form best to poorest affects performance
Recalls and writes down
Critical-
specific (but critical )
Incident
incidents that indicates the The Communication Process
Method
employee’s performance
 Develop an Idea
 Encode
 Transmit
  Receive Techniques for Communicating
 Decode
Downward Communication –
 Accept
message flows from higher levels
 Use
of authority to lower levels.
 Provide Feedback

Forms of Communication

Verbal communication- those

transmitted through hearing or Techniques Used:
sight.
Letters – when directives are
Oral communication – mostly complex and precise actions are
involves hearing the words of the required.
sender.
Manuals – useful sources of
Written communication – where information regarding company
sender seeks to communicate policy, procedures, and
through written words. organization.

Nonverbal Communication – means Handbooks – provides more specific

of conveying message through information about the duties and
body language. privileges of the individual workers.

Newsletters – provide a mixture of

personal, social, and work related-
The Barriers to Communication
information.
Personal Barrier – hindrance arising
from communicator’s
characteristics as a person. Upward Communication –
messages from persons in lower-
Physical Barrier – interference
level positions to persons in higher
occurring in the environment where
positions.
communication occurring in
environment. Techniques Used:

Semantic Barrier – study of  Formal Grievance Procedures

meaning expressed in symbols.  Employee Attitude and
Interference with reception of a Opinion Survey
message that occurs when the  Suggestion Systems
message is misunderstood even  Open-Door Policy
though it is received exactly as  Informal Gripe Sessions
transmitted.  Task Forces
 Exit Interviews

Overcoming Barrier to
Communication Grievance – any employees
concern over a perceived violation
 Use feedback
of the labor agreement that is
 Repeat message
submitted to the grievance
 Use multiple channels
procedure for eventual resolution.
 Use simplified language
Horizontal Communication –
messages sent to individuals or
groups from another of the same
organizational level or position.

Management Information System –

an organized method of providing
past, present, and projected
information on internal operations
and external intelligence for use in
decision making.