Engineering Management Principles PDF

ENGINEERING MANAGEMENT PRINCIPLES Management is... - The process of allocating and arranging human and non-human resources so that plans can be ► Getting things done through people....

ENGINEERING MANAGEMENT PRINCIPLES Management is... - The process of allocating and arranging human and non-human resources so that plans can be ► Getting things done through people. carried out successfully. ► The process of achieving organizational goals by Staffing engaging in the four major functions of planning & decision-making, organizing & staffing, - Involves filling and keeping filled, the positions directing/leading, and controlling. in the organization structure. - Process by which managers select, train, ► Identifying a "force"/group of people whose job promotes, and retires subordinate. is to direct the effort and activities of other people towards a common organizational objective. Directing/Leading ► The performance of conceiving and achieving - Influencing people so that they will contribute desired results by means of group effort consisting to organizational and group goals. of utilizing resources, that will determine the success and failure of an organization. Controlling Engineering is... - Measuring and correcting individual and organizational performance to ensure that ►The profession in which a knowledge of the events conform to plans mathematical and natural sciences gained by study, - Facilitates the accomplishment of plans. experience, and practice is applied with judgment to - The process of regulating organizational develop ways to utilize, economically, the material activities so that actual performance conforms and forces of nature for the benefit of mankind. to expected organizational standards. ►Engineer is a person who is applying his/her wManagerial Levels mathematical and science knowledge properly to `solve practical problems. Engineering Management is…….. ► is a process of leading and controlling a technical function. ► is similar to the other definitions of management, but a slant towards technical issues ► Strategic Managers who are ultimately responsible for the entire organization. Typical titles include CEO, “President”, “Executive Vice Functions of Management President”, “Executive Director”, “Senior Vice President”, “Vice President”. Planning & Decision-Making ►Tactical Managers located beneath the top - Involves selecting goals and objectives, as well levels of the hierarchy who are directly responsible as the action to achieve them; it requires for the work of managers at lower levels. Title decision-making, that is choosing the “best” include “Manager”, “Director of”, “Chief”, from among alternatives. “Department Head”, “Division Head”. Organizing ►Operational Managers at the lowest level of hierarchy who are directly responsible for the work - Involves establishing an intentional structure of operating (non-managerial) employees. Often of roles for people to fill in an organization. have titles that include the word “Supervisor”.  ►Integrity – “living it myself before leading others” ►Gratitude – “giving credits where it is due” ►Committed – willing to do whatever it takes attain organizational success. ►People Oriented – knows that people’s feelings are important. ► Focused – try to see the “big picture” within the forest details. Managerial Roles Scope of Management ► Unrelenting Pace Production Management - Managers began working the moment they arrived at the office in the morning and kept ►produce the right goods in right quantity at the working until they left at night. (e.g. Rather than right time and at the right cost. Consist of following taking coffee breaks they usually drank their activities: coffee while they attended meetings, lunches - Designing the product were almost eaten in the course of formal of - Location & Layout of plant and building informal meetings. - Operations of purchase & storage materials ► Variety, and Fragmentation - Planning & control of factory operations - Repairs & Maintenance - Managers handled a wide variety of issues - Inventory control and quality control throughout the day - Research and development etc.. ► Verbal Contacts and Networks Marketing Management - Managers showed a strong preference for verbal ►It refers to the identification of consumer's needs communication and relied heavily on networks. and supplying them the goods and services which A network is a set of cooperative relationships can satisfy those, wants. These activities are with individuals whose help is needed in order follows: for a manager to function effectively. Issues would-be managers should - Marketing Research to determine the needs and consider expectations of consumers - Planning and developing suitable products ►The increase workload - Setting appropriate prices - 70-80 hours per week or even longer. - Selecting the right channels of distribution - Promotional activities like advertising ►The challenge of supervising former peers. salesmanship to communicate with the customers. - One of the toughest issue for new managers. Financial Management ►The headache of responsibility for other people. ► seeks to ensure the right amount and type of funds to business at the right time and at reasonable ►Being caught in the middle. cost. The activities are as follows: - Caught between upper management and - Estimate the volume of funds requires for long workforce. term and short term needs of business. Excellence Managers have/are - Selecting the appropriate sources of funds ►Good communicator – acquire the skills or - Raising the required funds at the right time listening, speaking, reading, and writing. - Ensuring proper utilization and allocation of raised funds ►Flexible – multi-tasker, imaginative and - Administration of earnings innovative. Personal Management - Manpower planning - Recruitment ►It involves planning, organizing, directing & - Selection controlling the procurement, development, - Training & Development compensation, maintenance etc... of the human - Performance Appraisal resources in an enterprise. It consists of the - Compensation & promotion following activities: - Employee services & benefits - Maintaining personnel records etc... DECISION MAKING Decision 6. Policy and Operative Decision - Policy Decision critical. Top level management - A choice made from available alternatives - Operative Decision day to day operations. Low Decision Making level management 7. Long Term, Departmental and Non-economic - Refers to the process by which managers Decision analyze issues, evaluate alternatives, and - Long Term Decision taken for a longer period choose the most appropriate course of action to and high risk involvement achieve organizational objectives - Departmental Decision related to particular - The process of identifying problems, department in the company opportunities and then resolving them. - Non-economic Decision technical values. Moral behavior Types of Decision Making 1. Programmed & Non Programmed Decisions Decision Making Process - Programmed Decisions are made in response STEP 1- Identify the Decision to a situation that has occurred often enough to STEP 2- Gather Relevant Information enable managers to develop decision rules that STEP 3- Identify the Alternatives can be applied on the future. Recurring STEP 4- Weigh the Evidence organizational problems STEP 5- Choose Among Alternatives - Non programmed Decisions are made in STEP 6- Take Action response to a situation that is unique, poorly STEP 7- Review your Decisions & Its defined and largely unstructured and has Consequences important consequences. Deal with unusual problems Skills need for Decision Making 2. Major and Minor Decisions 1. Analytical Prowess 3. Routine and Strategic Decisions 2. Problem Solving Powerhouse - Routine Decisions similar to Programmed 3. The Art of Gathering Information Decision Making. Repetitive and do not need 4. The Foresight Factor analysis and evaluation. Made by middle level 5. Emotional Intelligence management 6. The Value of Clear Communication - Strategic Decisions related to the policy of the 7. Embrace Calculated Risks organization. Made by High level management 8. Learn form every choice 4. Organizational and Personal Decision - Organizational Decision the type of decision reflects policy of the organization. - Personal Decision manager’s individual/own decision. 5. Individual and Group Decision - Individual Decision taken by a single individual. - Group Decision conduct committee meetings  FUNCTIONS OF MANAGEMENT PLANNING 3. Financial plan - it is a document that summarizes the current financial situation of the Planning at Various Management Levels firm, analyzes financial needs, and recommends directions for financial activities. Top Management Level (Strategic Planning) 4. Human resource management plan - it is a Middle Management Level (Intermediate document that indicates the human resource Planning) needs of a company detailed in terms of quantity and quality and based on the requirements of Lower Management Level (Operational the company's strategic plan. Planning) Plans with time Horizon Planning Process 1. Short-range plans - these are plans intended to 1. Setting Organizational, Divisional, or cover a period of less than one year First-line Units goals supervisors are mostly concerned with these 2. Developing Strategies or Tactics to reach plans. those goals 2. Long-range plans - these are plans covering n 3. Determining Resource needed time span of more than one year. These are 4. Setting Standards mostly undertaken by middle and top management. Plans According to Frequency of Use Workforce Development Planning Standing Plans – are plans that are used again and - All about creating a diverse, high-performance again, and they focus on managerial situations that workforce made up of loyal and satisfied recur repeatedly. employees. Classified as follows: Product and Services Planning A budget, according to Weston and Brigham, is a - Is a function of the marketing, finance and plan which sets forth the projected expenditure operations departments. The marketing for a certain activity and explains where the department is responsible for discovering what required funds will come from. targets customers want and need A program is a single-use plan designed to coordinate a large set of activities. Expansion Plan A project is a single-use plan that is usually more - Good business owners and managers limited in scope than a program and is continually lay plans for the next stages of sometimes prepared to support a program growth in their companies. Single Use Plans – are specifically developed to Financial Planning implement courses of action that are relatively unique and are unlikely to repeated - Companies engage in financial planning activities the same as individuals and Classified as follows: households. Policies-they are broad guidelines to aid managers at every level in making decisions Functional Area Plans about recurring situations or function. 1. Marketing plan- this is the written document or Procedures-they are plans that describe the blueprint for implementing and controlling an exact series of actions to be taken in a given organization's marketing activities related to a situation. particular marketing strategy. Rules-they are statements that either require or 2. Production plan - this is a written document forbid a certain action. that states the quantity of output a company must produce in broad terms and by product family.  Parts of the Various Functional Area Plans The Contents of the Marketing Plan The Executive Summary - which presents an overall view of the marketing project and its potential. Table of Contents Situational Analysis and Target Market Marketing Objectives; and Goals Marketing Strategies The Contents of the Production Plan Marketing Tactics Manager’s inability to plan Schedules and Budgets Improper planning process Financial Data and Control Lack of commitment to the planning process The Contents of the Production Plan Improper information Focusing on the present at expense of the future ►The production plan must contain the following: Too much reliance on the planning department The amount of capacity the company must have’ Concentrating on only the controllable variables How many employees are required How much materialmust be purchased The Contents of the Financial Plan An analysis of the firm’s current financial condition as indicated by an analysis of the most recent statements A sales forecast The capital budget A set of pro forma (or projected) financial statements The external financing plan ORGANIZING TECHNICALA CTIVITIES REASONS FOR ORGANIZING Organizing is undertaken to facilitate the implementation of plans. In effective organi z ing, s teps are undertaken to b r e a k d o w n t h e t o t a l j o b i n t o m o r e manageable man-size jobs. “ORGANIZE” DEFINED Organizing is a management function which refers to  "the structuring of resources and effective manner ". The result of organizing process is the structure. Purpose of Structure Concerns when structuring an Organization It defines the relationships between tasks 01 01 Division of labor and the authority for individuals and departments It defines formal reporting relationships, 02 02 Delegation of authority Departmentation the number of levels in the hierarchy of the organization, and the span of control. It defines the groupings of individuals into 03 03 Span of Control departments and departments into organization. It defines the system to effect coordination  04 04 Coordination of effort in both vertical (authority) and horizontal (tasks) directions. FORMAL. ORGANIZATION It is the structure that details lines of responsibilities, authority, and position Formal structure defined by management 1.Organizational Chart 2.Organizational Manuals 3.Policy Manuals  Organizational Chart It is the diagram of the organization' s official positions and formal lines of authority. Organization Manuals It provides written description of authorityrelationships, details the functions of majororgani zational unit s , and de s c ribesjobprocudures.  Policy Manual it describes personnel activities andcompanypolicies. INFORMAL GROUPS There are ins tances w hen member s of an organization spontaneously form a group with friendship as a principal reason for belonging. This group is called an informal group. It is not a part of the formal organization and it does not have a formal performance purpose. TYPES OF ORGANIZATIONAL STRUCTURES 1. Functional Organization - This is a from of departmentalization in which everyone engaged in one functional activity, such as engineering or marketing, is grouped in one unit. FUNCTIONAL ORGANIZATION ADVANTAGES DISADVANTAGES The grouping of employees who perform task 01 Communication and coordination between 01 permit economies of scale and efficient resource use. departments are often poor. Since the chain of command converges at the top 02 Decisions involving more than one department 02 of the organization, decision making is centralized pile up at the top management level areoften provided unified direction from the top. 03 delayed. Work specialization and division of labor, which 03 Communication and coordination among employees within each department are excellent. 04 05 are stressed in a functional organization, produce The structure promotes high-quality technical problem solving.  it is difficult to identify which section or groupisresponsible fro routine, non-motivating employee tasks. 04 certain problems. The organization is provided with in depth skill 05 There is limited vies of organizational goals by specialization and development. employees. 06Employees are provided with career progress 06There is limited general management trainingfor employees. within functional departments. TYPES OF ORGANIZATIONAL STRUCTURES 2. Product or Market Organization - This refers to the organization of a company by divisions that brings together all those involved with a certain type of product or customer PRODUCT OR MARKETORGANIZATION ADVANTAGES DISADVANTAGES The organization is flexible and responsive to 01 There is high possibility of duplication of resources01 change. across divisions. 02 There is less technical depth and specializationin The organization provides a high concern for 02 customer's needs. 03 There is poor coordination across divisions. 03 divisions. The organization provides excellent coordination across functional departments. 04 There is easy pinpointing of responsibility for 04 There is less top management control. product problems.  05 There is emphasis on overall product division 05 There is competition for corporate resources. goals. 06The opportunity for the development of general management skills is provided. TYPES OF ORGANIZATIONAL STRUCTURES 3. Matrix Organization - It is an organizational structure in which each employee reports to both a functional or division manager and to a project or group manager. MATRIX ORGANIZATIONADVANTAGES DISADVANTAGES There is more efficient use of resources than the There is frustration and confusion fromdual chain 01 02 divisional structure.  01 of command. There is high conflict between divisional and There is flexibility and adaptability to changing 02 environment. 03 There are many meetings and more discussion 03 functional interests. The organization provides excellent coordination across functional departments. than action. 04 04 The development of both general and functional management skills are present. There is a need for human relations trainingfor key employees and managers. 05 There is interdisciplinary cooperation and any 05 There is a tendency for power dominance by one  expertise is available to all divisions. side of the matrix. 06There are enlarged task for employees which motivate them together. STAFFING THE ENGINEERING ORGANIZATION It is defined as “the management functionthat determines human resourceneeds,recruits, selects, trains, anddevelophumanresources jobs created by anorganization. Staffing is undertaken to matchpeoplewithj o b s s o t h a t t h e r e al i z at i onoftheorganization’s objectives will befacilitated. WhatisStaffing?  THE STAFFING PROCEDURES Training and Human resource Development Performance Appraisal planning Recruitment Employment Selection Decisions Separations Induction and Orientation 1 HumanResourcePlanning Forecasting – assessment of future human resource needs in relationtothecurrent capabilities of the organization. Programming – translating the forecasted human resource needs topersonnel objectives and goals Evaluating and control – monitoring human resource actionplansandevaluating their success. Methods of Forecasting 1. Time series methods – use historical data to develop forecasts of thefuture. 2.Explanatory, or causal models – attempts to identify the major variablesthatare related to or have caused particular past conditions andthenusecurrentmeasures of these variable to predict future conditions. There arethreetypesofexplanatory models: regression models, econometric models, andleadingindicators.  3.Monitoring methods – provide early warning signals of significant changesinestablished patterns and relationships so that the engineer managercanassess the likely impact and plan responses if required. 2 Recruitment Refers to attracting qualified persons to apply for vacant positionsinthecompany so that those who are best suited to serve the companymaybeselected.  3 Selection Ways of Determining the Qualifications of a Job Candidate: Type of Tests 4 InductionandOrientation 5 Trainingand Development Training Program for Non-Managers Training Programs for Managers Performance Appraisal 6 Waysof AppraisingPerformance: 1.Rating scale method. 2.Essay method. 3. 3.Management by objectives method. 4.Assessment center method. 5.Checklist methods. 6.Work standards method. 7.Ranking method. 8.Cristal-incident method. 7 Employment Decision 8 Separation COMMUNICATING Management of Engineering Projects LEADING Management of Engineering Projects THANK YOU! CONTROLLING Management of Engineering Projects THANK YOU!