ENGG MNGT, by. Medina, R.G.

, Rex 1

ENGINEERING MANAGEMENT

1. THE FIELD OF ENGINEERING MANAGEMENT

 The Functions of the Engineer
 The Engineer in Various Types of Organization Management Skills Required of Various
Levels
 What is Engineering Management?
 Management Defined
 The Process of management
 Requirements for the Engineer Manager’s Job
 How One May Become a Successful Engineer Manager

Chapter 1
THE FIELD OF ENGINEERING MANAGEMENT

Engineers are expected to perform a variety of tasks depending on their specialization and job
level. It is important to the engineer that he knows what is expected of him so that he may be able
to perform his job effectively and efficiently. His next concern will be to identify the skills required
but which he does not have. As engineers are not trained to directly deal with people, it is expected
that their weakness will most often be on people-based skills. This difficulty will be more apparent
once they are assigned to occupy management positions. It follows that if the engineer manager
would want to do his job well, some exposure to engineering management activities becomes
necessary.

THE FUNCTIONS OF THE ENGINEER

Since prehistoric times, mankind has benefited from the various tools, equipment, and projects
developed by engineers. Among are the following:
1. The stone bladed axe which was a very useful tool; and the irrigation system used to promote
crop growing - 6000 to 3000 B.C.
2. The pyramids of Egypt - 3000 to 600 B.C.
3. Roadbuilding by the Romans - 600B.C. to A.D. 400;
4. The production of paper and gunpowder by the Chinese - 100 A.D. to 1600 A.D.
5. The production of steam engine and the spinning and weaving machinery - 1601 A.D. to 1799
A.D.; and
6. The manufacture of cars and household appliances - in the modern times.

A listing of all useful tools, equipment, and projects developed and produced by engineers will
be sufficient to produce volumes of books. These contributions indicate that engineers have
become an indispensable segment of the world’s professions. This expectation will continue for a
long time.
Even as engineers are currently producing solutions to many of the difficulties faced by mankind,
much is still expected of them. Their outputs, new or improvements of old ones, are very much
needed in the following specific problem concerns:

a) The production of more food for a fast growing world population;

b) The elimination of air and water pollution;
c) Solid waste disposal and materials recycling;
d) The reduction of noise in various forms;
e) Supplying the increasing demand for energy;
f) Supplying the increasing demand for mobility;
g) Preventing and solving crimes; and
h) Meeting the increasing demand for communication facilities.

Specifically, the functions of engineering encompass the following areas:

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1. Research - where the engineer is engaged in the process of learning about nature and codifying
this knowledge into useful theories.
2. Design and Development - where the engineer undertakes the activity of turning a product
concept to a finished physical item. Design for manufacturability and value enginerring teams
(a feature of some companies) are charged with improvement of designs and specifications at
the research, development, design, and production stages of product development.
3. Testing - where the engineer works in a unit where new products or parts are tested for
workability.
4. Manufacturing - where the engineer is directly in charge of production personnel or assumes
responsibility for the product.
5. Construction - this is where the construction engineer ( a civil engineer ) is either directly in
charge of the construction personnel or may have responsibility for the quality of the
construction process.
6. Sales - where the engineer assists the company’s customers to meet their needs, especially
those that require technical expertise.
7. Consulting - where the engineer works are consultant of any individual or organization requiring
his services.
8. Government - where the engineer may find employment in the government performing any of
the various tasks in regulating, monitoring, and controlling the activities of various institutions,
public or private.
9. Teaching - where the engineer gets employment in a school and is assigned as a teacher of
engineering courses. Some of them later become deans, vice presidents, and presidents.
10. Management - where the engineer is assigned to manage groups of people performing specific
tasks.

THE ENGINEER IN VARIOUS TYPES OF ORGANIZATION

From the viewpoint of the engineer, organizations may be classified according to the degree of
engineering jobs performed:

1. Level One - these with minimal engineering jobs like retailing forms (selling)
2. Level Two - those with a moderate degree of engineering jobs like transportation companies.
3. Level Three - those with a high degree of engineering jobs like construction firms.

Figure 1.1 Types of Organization and the Management Skills Required of Engineers

General

Management skills required

specialized

level1 level2 level3

The Firm’s Quantity of Engineering Jobs

Management Skills Required at Various Levels

Among the types of organizations, the engineer will have a slim chance of becoming the general
manager or president of level one, unless of course, he owns the firm. The engineer manager may
be assigned to head a small engineering unit of the firm, but there will not be too many firms which
will have this unit.
In level two frims, the engineer may be assigned to head the engineering division. The need for
management skills will now be felt by the engineer manager.
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Level three firms provide the biggest opportunity for an engineer to become the president or
general manager. In this case, the engineer manager cannot function effectively without adequate
management skills.

WHAT IS ENGINEERING MANAGEMENT?

Engineering management refers to the activity combining “technical knowledge with the ability
to organize and coordinate worker power, materials, machinery, and money”.

When the engineer is assigned to supervise the work of even a few people, he is already
engaged in the first phase of engineering management. His main responsibility is to lead his group
into producing a certain output consistent with the required specifications ( meet quality standards
and volume or quantity demands).

The top position an engineer manager may hope to occupy is the general managerialship or
presidency of any firm, large or small. As he scales the management ladder, he finds that the higher
he goes up, the less technical activities he performs, and the more management tasks he accepts. In
this case, it is but proper that the management functions taught in pure management courses be well
understood by the engineer manager.

MANAGEMENT DEFINED

Since the engineer manager is presumed to be technically competent in his specialization, one
may now proceed to describe more thoroughly the remaining portion of his job, which is the
management.

Management may be defined as the “creative problem-solving process of planning, organizing,

leading, and controlling an organization’s resources to achieve its mission and objectives”.

THE PROCESS OF MANAGEMENT

Management is a process consisting of planning, organizing, directing (or leading), and

controlling.

Explained in a simple manner, management must seek to find out the objectives of the
organization, think of ways on how to achieve them, decide on the ways to be adapted and the
material resources to be used, determine the human requirements of the job, assign specific tasks to
specific persons, motivate them, and provide means to make sure that the activities are in the right
direction.

The specific activities in the management process are discussed more thoroughly in the
succeeding chapters.

REQUIREMENTS FOR THE ENGINEER MANAGER’S JOB

Depending on the type of products or services a firm produces, the engineer manager must have
the following qualifications:
1. A bachelor’s degree in engineering from a reputable school; In some cases, a master’s
degree in engineering or business management is required;
2. A few years experience in a pure engineering job;
3. Training in supervision;
4. Special training in engineering management.

These qualifications will be of great help to the engineer manager in the performance of the
various management functions.

HOW ONE MAY BECOME A SUCCESSFUL ENGINEER MANAGER

ENGG MNGT, by. Medina, R.G., Rex 4

Successful engineer managers do not happen as a matter of chance, although luck is a

contributory factor. It is very important for the engineer manager to know the various factors
leading to successful management.

There are at least three general preconditions for achieving lasting success as a manager.
These are the following:

1. Ability
2. Motivation to manage, and
3. opportunity

Ability
Managerial ability refers to the capacity of an engineer manager to achieve organizational
objectives effectively and efficiently.

Effectiveness, may be referred to a description of “whether objectives are accomplished”, while

Efficiency, is a description of the relative amount of resources used in obtaining effectiveness”.

To Illustrate:
If the civil engineer was asked by his superiors to finish a 100-kilometer road cementing project
within eight months, he is said to be effective if he finished the job within the required period. On
the other hand, his efficiency is measured by the inputs (labor and materials) he poured or used into
the project in relation to the actual output (the 100-kilometer road). If the same output is made
with less inputs, the more efficient the civil engineer becomes.

Motivation to Manage
Many people have the desire to work and finish specific tasks assigned by superiors, but not
many are motivated to manage other people so that they may contribute to the realization of the
organization’s objectives.

A management researcher, John B. Miner, developed a psychometric instrument to measure

objectively an individual’s motivation to manage. The test is anchored to the following dimensions:
1. Favorable attitude toward those in positions of authority, such as superiors.
2. Desire to engage in games and sports competition with peers.
3. Desire to engage in occupational or work-related competition with peers.
4. Desire to assert oneself and take charge.
5. Desire to exercise power and authority over others.
6. Desire to behave in a distinctive way, which includes standing out from the crowd.
7. Sense of responsibility in carrying out the routine duties associated with managerial work.

High scores in the foregoing dimensions are associated with high motivation to manage.

Opportunity
Successful managers become possible only if those having the ability and motivation are given
the opportunity to manage. The opportunity for successful management has two requirements:
1. Obtaining a suitable managerial job, and
2. Finding a supportive climate once on the job.
Newspaper advertisements abound with needs for engineer managers. It is a little difficult to
determine if the firms requiring their services provide a supportive climate for effective and efficient
management. A supportive climate is characterized by the recognition of managerial talent through
financial and non-financial rewards.

SUMMARY
Engineers are known for their great contributions to the development of the world’s civilization.
There are many areas where their presence is necessary like research, design and development,
testing, manufacturing, construction, sales, consulting, government, teaching, and management.
Engineers may be found contributing their share in the various levels of organization.
ENGG MNGT, by. Medina, R.G., Rex 5

Engineering activities need to be managed and engineers are sometimes placed in positions
where they have to learn management skills.
Management is concerned with planning, organizing, leading, and controlling an organization’s
resources to achieve its mission and objectives.
There are certain qualifications required of the engineer manager.
One may become a successful engineer manager if the preconditions of ability, motivation to
manage, and opportunity to manage are met.
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DECISION-MAKING

Managers of all kinds and types, including the engineer manager, are primarily taksed to provide
leadership in the quest for the attainment of the organization’s objectives. If he is to become
effective, he must learn the intricacies of decision-making. Many times, he will be confronted by
situations where he will have to choose from among the various options. Whatever his choice, it will
have effects, immediate or otherwise, in the operations of this organization.

The engineer manager’s decision-making skills will be very crucial to his success as a professional.
A major blunder (careless mistake) in decision-making may be sufficient to cause the destruction of
any organization. Good decisions, on the other hand, will provide the right environment for
continuous growth and success of any organized effort.

DECISION-MAKING AS A MANAGEMENT RESPONSIBILITY

Decisions must be made at various levels in the workplace. They are also made at the various
stages in the management process. If certain resources must be used, some must make a decision
authorizing certain persons to appropriate such resources.

Decision-making is a responsibility of the engineer manager. It is understandable for managers

to make wrong decisions at times. The wise manager will correct them as soon as they are identified.
The bigger issue is the manager who cannot or do not want to make decisions. William A. Delaney,
concludes that this type of managers are dangerous and “should be removed from their position as
soon as possible.”

Management must strive to choose a decision option as correctly as possible. Since they have
that power, they are responsible for whatever outcome their decisions bring. The higher the
management level is, the bigger and the more complicated decision-making becomes.

An example may be provided as follows:

The production manager of a certain company has received a written request from a section
head regarding the purchase of an air-conditioning unit. Almost simultaneously, another request
from another section was forwarded to him requiring the purchase of a forklift. The production
manager was informed by his superior that he can only by one of the two requested items due to
budgetary constraints.

The production manager must now make a decision. His choice, however, must be based on
sound rguments for he will be held responsible, later on, if he had made the wrong choice.

William A. Delaney, author, The 30 most common problems in management and how to solve
them (New York: AMACOM, 1982) p. 89.
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WHAT IS DECISION-MAKING?

Decision-making may be defined as “the process of identifying and choosing alternative courses
of action in a manner appropriate to the demands of the situation.”
To solve certain problem.
The definition indicates that the engineer manager must adapt a certain procedure designed to
determine the best option available to solve certain problems.

Decisions are made at various management levels ( I.e. top, middle, lower levels) and at various
management functions (I.e. planning, organizing, directing, and controlling). Decision-making,
according to experts “is the heart of all management functions.”

THE DECISION-MAKING PROCESS

Rational Decision making, according to David H. Holt, is a process involving the following steps:

1. diagnose problem
2. Analyze environment
3. Articulate problem opportunity
4. Develop viable alternatives
5. Evaluate alternatives
6. Make a choice
7. Implement decision
8. Evaluate and adapt decision results

Diagnose Problem

If a manager wants to make intelligent decision, his first move must be to identify the problem.
If the manager fails on this aspect, it is almost impossible to succeed in the subsequent steps. An
expert once said “ identification of the problem is tantamount to having the problem half-solved”.

What is a Problem? A problem exist when there is a difference between an actual situation
and a desired situation. For example, the management of a construction company entered in to a
contract with another party for the construction of a 25-storey building on a certain site. The actual
situation of the firm is that it has not yet constructed the building. The desired situation is the
finished 25-storey building. In this case, the actual situation is different from the desired situation.
The company, therefore, has a problem and that is, the construction of the 25-storey building.

Analyze the Environment

The environment where the organization is situated plays a very significant role in the success or
failure of such an organization. It is, therefore, very important that an analysis of the environment
be undertaken.

The objective of environmental analysis is the identification of constraints, which may be spelled
out as either internal or external limitations.

Examples of internal limitations are as follows:

1. Limited funds available for the purchase of equipment

2. Limited training on the part of employees
3. Ill-designed facilities
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Examples of external limitations are as follows:

1. Patents are controlled by other organizations

2. A very limited market for the company’s products and services exists
3. Strict enforcement of local zoning regulations

When decisions are to be made, the internal and external limitations must be considered. It
may be costly, later on, to alter a decision because of a constraint that has not been previously
identified.

An illustration of failure to analyze the environment is as follows:

The president of a new chemical manufacturing company made a decision to locate his factory in
a place adjacent to a thickly populated area. Construction of the building was made with precision
and was finished in a short period. When the clearance for the commencement of operation was
sought from local authorities, this could not be given. It turned out that the residents opposed the
operation of the firm and made sure that no clearance is given.

The president decided to relocate the factory but not after much time and money has been lost.
This is a clear example of the cost associated with management disregarding the environment when
decisions are made. In this case, the president did not consider what the residents could do.

Components of the Environment. The environment consists of two major concerns:

1. Internal
2. External

The internal environment refers to organizational activities within a firm that surrounds
decision-making. Shown in figure 2.1 are the important aspects of the internal environment.

The external environment refers to variables that are outside the organization and not
typically within the short-run control of top management. Figure 2.2 shows the forces
comprising the external environment of the firm.

Develop Viable Alternatives

Oftentimes, problems may be solved by any of the solutions offered. The best among the
alternative solutions must be considered by management. This is made possible by using a
procedure with the following steps:

1. Prepare a list of alternative solutions.

2. Determine the viability of each solution
3. Revise the list by striking out those which are not viable.

To illustrate:

An engineering firm has a problem of increasing its output by 30%. This is the result of a new
agreement between the firm and one of its clients.
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Figure 2.1 The Engineering Firm and the Internal Environment in Decision-Making.

THE ENGINEERING FIRM

INTERNAL ENVIRONMENT

Organizational Aspects
Like org. Structure, policies,
procedures, rules, ability of
management, etc.
INTERNAL
Marketing Aspects ENVIRONMENT
Like product strategy, promotion
DECISION
strategy, etc.
EXTERNAL
Personnel Aspects ENVIRONMENT
Like recruitment practices, incentive
systems, etc.

Production Aspects
Like plant facility layout, inventory
control, etc.

Financial Aspects
Like liquidity, profitability, etc.
ENGG MNGT, by. Medina, R.G., Rex 10

The list of solutions prepared by the engineering manager shows the following alternative courses of
action:

1. Improve the capacity of tghe firm by hiring more workers and building additional facilities;
2. Secure the services of subcontractors;
3. But the needed additional output from another firm;
4. Stop serving some of the company’s customers; and
5. Delay servicing some clients

The list was revised and only the first three were deemed to be viable. The last two were deleted
because of adverse effects in the long-run profitability of the firm.

Evaluate Alternatives

After determining the viability of the alternatives and a revised list has been made, an evaluation
of the remaining alternatives is necessary. This is important This is important because the next step
involves making a choice. Proper evaluation makes choosing the right solution less difficult.

How the alternatives will be evaluated will depend on the nature of the problem, the objectives
of the firm, and the nature of alternatives presented. Each alternative must be analyzed and
evaluated in terms of its value, cost, and risk characteristics.

The value of the alternatives refers to benefits that can be expected. An example may be
described as follows: A net profit of P10 million per year if the alternative is chosen.
The cost of the alternative refers to out-of-pocket costs (like P100 million for construction
facilities), opportunity costs (like opportunity to earn interest of P2 million per year if money is
invested elsewhere), and follow-on costs (like P3 million per year for maintenance of facilities
constructed).
The risk characteristics refer to the likelihood of achieving the goals of the alternatives. If the
probability of a net profit of P10 million is only 10 %, then the decision-maker may opt to consider an
alternative with a P5 million profit but with an 80 % probability of success.

Another example of an evaluation of alternatives:

An engineer manager Is faced with a problem of choosing between three applicants to fill up a
lone vacancy for a junior engineer. He will have to set up certain criteria for evaluating the
applicants. If the evaluation is not done by a professional human resources officer, then the
engineer manager will be forced to use a predetermined criteria.

A typical evaluation of job applicants will appear as follows:

---------------------------------------------------------------------------------------------------------------------------
EVALUATION SHEET

Title of Vacant Position: JUNIOR ENGINEER

Date of Evaluation: December 28, 1996

Applicant Education Training Experience Age Total Points

1. Jose Sales 40 35 4 10 89
2. Joel Andres 40 36 5 9 90
3. Alex Reyes 40 38 6 7 91

Evaluator: Inno T. Tan

Manager
Engineering Division
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Make a Choice

After the alternatives have been evaluated, the decision-maker must be ready to make a choice.
This is the point where he must be convinced that all the previous steps were correctly undertaken.

Choice-making refers to the process of selecting among alternatives representing potential

solutions to a problem. At this point, particular effort should be made to identify all significant
consequences of each choice.
To make the selection process easier, the alternatives can be ranked from best to worst on the
basis of some factors like benefit, cost, or risk.

Implement Decision

After a decision has been made, implementation follows. This is necessary, or decision-making
will be an exercise in futility.

Implementation refers to carrying out the decision so that the objective sought will be achieved.
To make implementation effective, a plan must be devised.

At this stage, the resources must be made available so that the decision may be properly
implemented. Those who will be involved in implementation, must understand and accept the
solution.

Evaluate and Adapt Decision Results

In implementing the decision, the results expected may or may not happened. It is, therefore,
important for the manager to use control and feedback mechanisms to ensure results and to provide
information for future decisions.

Feedback refers to the process which requires checking at each stage of the process to assure
that the alternatives generated, the criteria used in evaluation, and the solution selected for
implementation are in keeping with the goals and objectives originally specified.

Control refers to actions made to ensure that activities performed match the desired activities or
goals, that have been set.

In this last stage of the decision-making process, the engineer manager will find out whether or
not the desired result is achieved. If the desired result is achieved, one may assume that the
decision made was good. If it was not achieved, further review of analysis is necessary.

Figure 2.2 The Engineering Firm and its External Environment

Government
Engineers Labor Unions

ENGINEERING Suppliers
Clients
FIRM

Public
Competitors
Bank
s
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Figure 2.3 Feedback as a Control Mechanism in the Decision-Making-Process

Step 1 Diagnose Problem

Step 2 Analyze
Environment

Step 3 Articulate
Problem or
opportunity

Step 4 Develop viable

alternatives

Step 5 Evaluate
Alternatives

Step 6 Make a choice

Step 7 Implement
decision

Step 8 Evaluate Results Results not Determine

achieved steps where
error was
made

Results Achieved Adapt Decision

Results