CONTROLLING

The function of controlling in service systems management and engineering refers to activities taken on
by an engineering manager to assess and regulate work in progress, evaluate results for the
purpose of securing and maintaining maximum productivity, maintain and upgrade critical talents,
and reduce and prevent unacceptable performance.

ENGINEERING MANAGERS EXERCISE CONTROL

- SETTING STANDARDS
- MEASURING PERFORMANCE
- EVALUATING PERFORMANCE
- CONTROLLING PERFORMANCE

SETTING PERFORMANCE STANDARDS

- To set standards is to specify criteria by which work, and results are measured and
evaluated. Setting performance standards explicitly defines the expected results.
- It is important for both the company and its employees to distinguish between
performance grades of “outstanding,” “better than average,” “average,” “below average,”
and “unacceptable” and to understand how performance is measured.
- Setting standards provides specific guidelines for exercising authority and making
decisions.
- Standards are typically established in the form of how many, how good, how well, and
how soon, as imposed by the company management, the customers, or the marketplace.
- Effective standards are characterized as being company sponsored, measurable,
comparable, reasonable, and indicative of the expectation of work performance on an
objective basis in order to promote worker growth.
- They are also identified as being considerate of human factors by soliciting the workers’
inputs and securing their understanding and acceptance.
- Hammer (2007) - a variety of companies make mistakes in setting performance
standards. Some metrics are set that will make everyone involved look good. Others
focus on local but not global performance and on component but not system
performance.
TYPES OF STANDARDS
● Technical Standards - specify metrics related to quality, quantity, mean time between
failure (MTBF), maintenance requirements, and so on.
● Historical Standards - are based primarily on past records. Market standards are those
related to competition, sales, return on investment (ROI), earnings expected by securities
analysts, and other factors.
● Market Standards - are those related to competition, sales, return on investment (ROI),
earnings expected by securities analysts, and other factors
● Planning Standards - mostly relates to the strategic and operational planning needs of
the company. They address topics such as objectives, programs, schedules, budgets,
and policies.
● Safety Standards - refer to the metrics related to the safe operation of the company’s
facilities.
● Equal Employment Opportunity Standards - are specific practices related to
affirmative action for the purpose of achieving equal employment opportunity for all.
 BENCHMARKING
- Benchmarking is a method of defining performance standards in relation to a set of internal and
external references.

TYPES OF BENCHMARKING
● Internal Benchmarking
- uses references internal to a company to set performance standards.
- convenient to utilize, as it offers a reasonable, short-term performance assessment.
● External benchmarking
- uses references external to a company to set performance standards.
6 Application of External Benchmarking
➢ Financial ratios
➢ Performance metrics
➢ Best practices
➢ Critical success factors
➢ Target pricing
➢ Balanced scorecard

PRODUCT DIMENSIONS - Product quality has several dimensions. According to Garvin (1984), product
quality has the following eight dimensions:
1. Performance (operational characteristics)
2. Features
3. Reliability
4. Conformance to design specification
5. Durability
6. Serviceability
7. Aesthetics (look and feel)
8. Perceived quality (affected by brand name and company reputation)

SAMPLE BENCHMARKING METRICS

- Many sets of performance metrics are available from business literature. ( As what the sample
question earlier) contains selected samples of metrics used in various business domains.

LIMITATIONS OF BENCHMARKING
- Benchmarking is useful but has certain limitations. For example, some reference data might not
be available, and in such cases, estimates must be made. This might cause the value of such
benchmarks to be less robust.
- Benchmarking metrics are always based on past performance, and they do not predict the future.
Neither can they be used to predict new competition. However, even with these limitations,
past-oriented benchmarks are still valuable.
 TALENT MANAGEMENT
- Managers need to know how to acquire and retain critical professionals, as well as train and
upgrade employees, who need new skills to serve the company.
STEPS:
1. Preserving Talents
2. Measuring Performance
3. Evaluating Performance
4. EvaluatingPerformance

PRESERVING TALENTS
- Professionals join companies for rational reasons, such as better compensations, benefits, and
career opportunities.
- Lawler et al. (2008) pointed out that there are various reasons why those professionals, who
appear to be seemingly happy, would leave their organizations voluntarily.

CORRECTING PERFORMANCE
- To correct performance is to rectify and improve work done and results obtained. The
performance evaluation may show that the quality of the employee’s work is below expectation.
Engineering managers must understand that there are reasons for performance deficiencies.
- Engineering managers should correct an employee’s mistakes by focusing on future progress
and growth.

MEANS OF CONTROL
- Engineering managers have a number of tools available to exercise control. They can perform
personal inspections, review progress, and define any variance to plans. This is the strategy of
management by exception.
- Managers may set priorities with respect to job assignment, resource deployment, and
technology application. They may also exercise control by managing resources.

GENERAL COMMENTS
- Engineering managers must constantly define which tasks should be performed, and have
employees performing these tasks correctly.
- Control should be focused on where action takes place. In general, self-control imposed by the
persons involved is the most useful type. However, by and large, people also resent control, and
extensive control may lead to loss of motivation

CONTROL OF MANAGEMENT TIME

- Time is a valuable and limited resource for everyone, including managers. Management activities
have several common characteristics: Important tasks often arrive at unpredictable times, trivial
tasks often take up a disproportionately large amount of time, and interruptions are common to a
manager’s schedule.
- Engineering managers may waste a lot of time if the roles and responsibilities of employees are
not clearly defined.
- Still other managers waste time because of poor communication related to policies, procedures,
meetings, and other subjects.
Techniques for engineering managers avoid wasting time:
● Set goals for the day, the week, the month, and the year.
● Prioritize tasks to be done, beginning with the most important tasks to least important.
● Reserve blocks of time to pursue tasks.
● Plan each task beforehand and group some of them together.
● Minimize interruptions
● Make use of waiting time at the airport, on the train, in the doctor’s office, and so on.
● Keep reports and memoranda short and to the point.

CONTROL OF PERSONNEL
- Managerial control is exercised primarily for the purposes of maximizing company productivity
and minimizing potential damages arising from ethics, laws, safety, and health issues. For highly
skilled personnel, less control is more effective and acceptable. Excess control induces
undesirable reactions and brings forth adverse effects.
- To manage creative people, or those who are able to deliver new and useful results, managers
need to set targets, monitor the employees periodically, apply a low level of supervision, and
maintain a collaborative and creativity-inducing work environment (McKenna and Maister 2002;
Ivancevich and Duening 2001).

CONTROL OF BUSINESS RELATIONSHIP

- It is highly advisable that engineering managers acquire the habit of proactively forming,
maintaining, and controlling new business relationships for the benefit of their employers and
themselves.
- Contacts may be established with noncompetitors. At proper occasions, engineering managers
should be accustomed to introducing themselves to others with a five-second commercial —a
brief self-description of their key areas of expertise.

CONTROL OF PROJECTS
- Engineering managers exercise control over projects when serving as project leaders.
- Tools for project control include PERT, CPM charts, or suitable computer or Internet-based
project-management software.
- Zwikael and Globerson (2008) compared the quality of project management in services with that
of other industrial sectors. Their survey indicates that the project management in services is poor
in technical performance and customer satisfaction, two of the key metrics defining quality.
- They recommend that in order for project management in service to improve outcomes,
companies need to emphasize the planning, assurance and control aspects of their projects:
● Quality planning — cost benefit analysis, benchmarking, cost of quality
● Quality assurance— Quality audit, process analysis, cost benefit analysis
● Quality control — cause-effect diagram, control charts, flow charting, histogram, Pareto
charts, run charts, scatter diagram and inspection
Project Control Issues
1. Cost control
2. Schedule control
3. Critical path activities
4. Task deviation from plan
5. Collaboration
6. Conflict resolution
 CONTROL OF QUALITY
To achieve success in the marketplace, companies focus on product and service quality as two of several
attributes deemed important to customers. For some companies, to plan and implement quality control
programs represents a major engineering management undertaking.

EARLY PROGRAMS ON QUALITY

- A number of years ago, Deming (2000) promoted the concept of product quality in the United
States and got few followers. He went to Japan and was enthusiastically welcomed there. Since
then, a number of quality-control practices have been advanced by the Japanese, such as quality
circles, Kaizen, Kanban, just in time (JIT), lean production, Taguchi, Ishikawa, and the 5S
campaign.
- Kanban means looking up to the board in order to adjust to a constantly varying production
schedule.
- Kaizen means change for the better, or continuous sustainable progressiveness.
- These quality concepts are logical, reasonable, practical, and, above all, obvious. In fact, there is
really nothing new or novel in them.
- The 5S campaign includes :
▻ Seiri —arrangement
▻ Seiton—tidying up
▻ Seisou —cleaning
▻ Seiketsu—cleanliness
▻ Shukan—customizing.

FMEA (failure mode and effect analysis)

- FMEA is a proactive program intended to catch all possible failure modes before they actually
occur.
- Like Kaizen and FMEA, total quality management (TQM) is also a very powerful program
addressing the issues related to product quality and organizational productivity.

Six Sigma
- Six Sigma is a quality management and control tool initiated by Motorola in the 1980s. Typical
failure rate of common processes is four sigma, about 6,000 defects per million.
- By definition, six sigma level of quality means no more than 3.4 defects per million.
Five specific steps (DMAIC):
1. Define
2. Measure
3. Analyze
4. Improve
5. Control

Services Are Characterized By The Following:

- Intangibility and heterogeneity of service outputs— containing non-physical elements such as
courtesy, responsiveness and accessibility.
- Consumption and delivery take place simultaneously.
- High degrees of labor intensity and customer interactions.
Six Sigma can be useful to some of the repetitive and standard processes within the service industry,
such as
▻ accounts receivable
▻ sales
▻ R&D
▻ Finance
▻ information systems
▻ legal
▻ Marketing
▻ public affairs
▻ human resources.

Quality control is an important function in which engineering managers play a key role. They need to be
actively and persistently involved with workers to invoke common sense in eliminating wastes, speeding
delivery, simplifying processes, paying attention to the gritty details of practice, and improving the way
work gets done continuously.

What is the generic problem-solving approach applicable to solve most

engineering and management problems?
1. Perform a situation analysis
2. Formulate a statement of the problem.
3. Define performance standards that are observable, measurable, and relevant to the goal.
4. Generate alternative solutions to the problem
5. Evaluate these alternatives in terms of their consequences to the organization.
6. Select the best alternative solution with the most value and least adverse effect on the
organization.
7. Implement a pilot test of the proposed solution and revise as indicated from practical experience.
8. Implement the solution.
9. Evaluate the outcome.
10. Revise the process as necessary

CONTROL OF KNOWLEDGE
- Engineering managers are responsible for producing, preserving, safeguarding, and applying
corporate engineering and technology knowledge. They also need to draft policies to facilitate the
control of knowledge.
- One of the major problems in knowledge management is that innumerable knowledge chunks are
dispersed throughout various documents within the company
- Another major problem in knowledge management is that most experts do not like to share their
knowledge with others, rendering the use of knowledge acquisition tools somewhat ineffective.
Knowledge refers to the sum total of corporate intellectual properties that are composed of
▻ Patents
▻ Proprietary know-how
▻ Technical expertise
▻ Design procedures
▻ Empirical problem-solving heuristics
▻ Process operational insights, and others
KNOWLEDGE MANAGEMENT
1. Experimentation - Put systems and processes in place to facilitate the search and test of new
knowledge
2. Benchmarking - Learn from one’s own experience, and best practices of others in industry, by
reflection and analysis.
3. Preservation of Knowledge - Set policies concerning the preparation of reports, design
procedures, and data books.
4. Dissemination of Knowledge - Rotate experts to different locations or jobs so that knowledge
may be shared with and learned by others.