Introduction to Engineering Management.pdf

INTRODUCTION TO ENGINEERING MANAGEMENT I. PRINCIPLES OF MANAGEMENT PRACTICE A. DEFINITION OF ENGINEERING Engineering is the profession in which a knowledge of the mathematical and natural sciences, gained by study, experience, and practice, is applied with judgment, to develop ways t...

INTRODUCTION TO ENGINEERING MANAGEMENT I. PRINCIPLES OF MANAGEMENT PRACTICE A. DEFINITION OF ENGINEERING Engineering is the profession in which a knowledge of the mathematical and natural sciences, gained by study, experience, and practice, is applied with judgment, to develop ways to utilize, economically, the materials and forces of nature for the benefit of mankind. Types: 1. Agricultural Engineering 2. Architectural Engineering 3. Bioengineering/Biomedical Engineering 4. Ceramic Engineering 5. Chemical Engineering 6. Civil Engineering 7. Computer Engineering 8. Electrical Engineering 9. Environmental Engineering 10. Fire Protection Engineering 11. Industrial Engineering 12. Manufacturing Engineering 13. Mechanic Engineering 14. Metallurgy and Materials Engineering 15. Mineral and Mining Engineering 16. Nuclear Engineering 17. Ocean Engineering 18. Transportation Engineering B. DEFINITION OF MANAGEMENT The word “Management” originates from Old French ménagement which means “the art of conducting, directing”, and from Latin manu agere which means “to lead by the hand”. Management characterizes the process of leading and directing all or part of an organization, often a business, through the deployment and manipulation of resources (human, financial, material, intellectual or intangible). Areas of Management: 1. Change management 2. Communications management 3. Constraint management 4. Cost management 5. Crisis management 6. Customer relationship management 7. Earned value management 8. Engineering management 9. Enterprise management 10. Facility management 11. Integration management 12. Knowledge management 13. Marketing management 14. Micromanagement 15. Pain management 16. Perception management 17. Procurement management 18. Program management 19. Project management 20. Process management 21. Product management 22. Quality management 23. Resource management 24. Risk management 25. Skills management 26. Spend management 27. Supply chain management 28. Systems management 29. Time management 30. Stress management C. DEFINITION OF ENGINEERING MANAGEMENT Engineering management is a specialized form of management concerned with the application in engineering, as a result of the unique personalities and technical nature of engineering. Engineering management refers to the functional management of technical professionals. Example areas of engineering are product development, manufacturing, construction, design engineering, industrial engineering, technology, production, or any other field that employs personnel who perform an engineering function. Successful engineering managers typically require training and experience in business and engineering. Technically inept managers tend to be deprived of support by their technical team, and non-commercial managers tend to lack commercial acumen to deliver in a market economy. Largely, engineering managers manage engineers who are driven by non-entrepreneurial thinking, thus require the necessary people skills to coach, mentor and motivate technical professionals. Engineering professions joining manufacturing companies tend to become engineering managers over a period of time. They learn all the facets of management on job and often this process is slow and disoriented. D. EVOLUTION OF MANAGEMENT THOUGHT Approaches to Management 1. Classical Approach 2. Behavioral Approach 3. Quantitative Approach 4. Modern Approaches to Management According to one school of thought, history has no relevance to the problems faced by managers today. Some are also of the opinion that management theory is too abstract to be of any practical use. However, both theory and history are indispensable tools for managing contemporary organizations. Like most modern disciplines, contemporary management thought has its foundations in the history of management and the many significant contributions of theorists and practitioners. A theory is a conceptual framework for organizing knowledge that provides a blueprint for various courses of action. Hence, an awareness and understanding of important historical developments and theories propounded by early thinkers is important for today’s managers. E. Major Classification of Management Approaches and their Contributors HENRY FAYOL’S PRINCIPLES OF MANAGEMENT Fayol developed theory of management. According to him managerial excellence is a technical ability and can be acquired. He developed theories and principles of management which are universally accepted and make him universalistic. He was the pioneer of the formal education in management. Fayol's principles of management meet the requirements of modern management. Henry Fayol, a french industrialist, offered fourteen principles of management for the first time in 1916. During the period of 1920-40 in the U.S. many authors did hard work in developing and testing various principles of management. Today, there is a very lengthy list of management principles and it is not possible to give an exhaustive lot of these management principles. According to Fayol management was a separate and distinct skill from other business function. He also felt that management skills had been the most neglected aspect of business operations. Fayol developed fourteen general principals of managements. According to him these principles can be applied in all types, functions, levels and size of organizations. This had earned him the title of “UNIVERSALIST”. Following are the fourteen principles of management developed by Henry Fayol: 1. Division of work: This is the principle of specialization which applies to all kinds of work. The more people specialize the more efficiently they can perform their work. Specialization increases output by making employees more efficient. 2. Authority and Responsibility: According to Fayol, responsibility is a corollary and a natural consequence of authority. Responsibility implies an obligation to perform the task in a satisfactory manner. 3. Discipline: Good discipline is the result of effective leadership, a clear understanding between management and workers regarding the organization’s rules and the judicious use of penalties for violation of the rules. 4. Unity of Command: Every employee should receive order and instruction from only one superior. Dual command is a perpetual source of conflict. If a person receives order from more than one superior, it would lead to confusion and chaos. 5. Unity of Direction: This principle calls for one manager one plan for all operations having the same objectives. This principle when applied properly, ensure unity of action and facilitates coordination. 6. Subordination of Individual Interest to the General Interests: The interest of the organization is above the individual and the group. This can be achieved when manager set an example through their exemplary behaviour. They must be prepared to sacrifice their personal interest whenever such interest is in conflict with organizational interest. 7. Remuneration: Workers should be paid a fair wage for their service. The method of wage payment should provide maximum possible satisfaction to both employees and employer. 8. Centralization: Everything that goes to increase the subordinate role is decentralization, everything which goes to reduce it is centralization. Whether decision making is centralized (to management) or decentralized (to subordinates) is a matter of proper proportion. The problem is to find the best amount of centralization in each case. 9. Scalar chain hierarchy: The graded chain of authority from top to bottom through which all communication flow is formed is the “Scalar Chain”. 10. Order: People and material should be in the right place at the right time. A place for everything and everything in its place. 11. Equity: Manager should be both friendly and fair to their subordinates. Employees who have justice and kindness promote better relation between employees and employer. 12. Stability of tenure of personnel: Management must implement practice which encourages long term commitment of employees. Instability of tenure can significantly affect the fortunes of a company. 13. Initiative: Employees must be encouraged to think and implement a plan of action even through some mistake may result. The opportunity to perform independently is an essential component of employee growth and development. 14. Spirit of Co-operation (Spirit de crops) This principle state that “Union is Strength”. Fayol defined esprit de corps as unity of effort through harmony of interest. Promoting team sprit will give the organization a sense of unity. These fourteen principles were considered to be flexible and capable of meeting every managerial need. Fayol’s contribution to management theory is unique and valuable. In fact, he was the first management thinker who contributed substantially and brought respectability to management as a discipline. Undoubtedly, Fayol was the important management thinker who has presented the most lucid and highly systematic analysis of the management. MODERN MANAGEMENT THEORY The past thirty years witnessed a “Knowledge Explosion” in the field of managements. During this period management writer have been primarily concerned with integrating the findings of scientific management, principles of management and human relations movements. However, two integrating trends have developed throwing adequate light on the dynamic nature of management namely: - o System Approach o Contingency Approach These modern management theories considered all elements the whole organization as well as components parts. The organization is viewed as adaptive systems which must in order to survive adjust to environmental changes. The organization and its environment are seen as interdependent; each depends on the other for resources from scientific management, human relations. It is a background that furnishes a foundation for understanding Contemporary management theory and practice. 1. System Approach A system in simple term is a set of interrelated parts. It is a group of interrelated but separate elements working towards a common purpose. The arrangement of elements must be orderly, there must be proper communication facilitating interaction between the elements and finally the interaction should lead to achieve a common goal. The organization transforms input into a variety of outputs and offers the same to the external environment in the form of products good and services. Sale of the output provides the necessary energy (feedback) to the system cycle. The system approach provides a unified focus to organizational efforts. A major contribution of the system approach results from its strong emphasis on the interrelatedness or mutuality of the parts of an organization. Another important benefit of system theory lies in its treatment of the organization as an open system. A close system imports something from the environment and exports something into the environment. The system theory of management is characterized by the following: a) Dynamic: - Within the organization the process of interaction between subsystem is dynamic. b) Multilevel and Multidimensional: - It is micro within the nation’s industrial network and it is macro with respect to its internal units. The modern manager is forced to recognize the importance of parts as well as the whole. c) Multimotivated: - Motivation is an extremely complex process and drawing simplistic equation is a futile exercise. d) Probabilistic: - Modern theory tends to probabilistic. “Statement in modern theory tends to be qualified with phrases such as “may be”, “in general” and usually” because modern theory recognizes that few predictive statement can be made with certainty.  e) Multidisciplinary: - Modern theory of management is enriched by contribution from disciplines like sociology, psychology, economics, anthropology, ecology mathematics, operations research and so on. f) Descriptive:- Individual are free to select the objectives and the methods to improve organizational effectiveness. g) Multivariable: - There is no simple cause effect phenomenon in organizational activities. An event may be the product of many factors that are in turn interrelated and interdependent. h) Adaptive: - An organization and its environment are expected to rearrange their parts. Organization tries to cope with environment changes through the “feed back” mechanism. An organization must produce output acceptable to components in environment It is true that “System theory provides a broad Philosophical perspective that bridge academic disciplines and mounts integrated attack on a wide variety of problem” 2. Contingency Theory In recent years especially after 1970 the word “contingency” has invaded the field of Management. One important contribution of contingency perspective may best be summed up in the statement that “there is no one best way to manage”. According to this approach the best way to lead, plan organize & conduct managerial activities varies with the situations. There are no plans, organization structure leadership style or control that will fit all situations. A manager trained in the contingency approach may offer a solution that is responsive to the characteristics of the total situation being faced. Organization characterized by the limited resources, unskilled labour force, limited training opportunities, limited products offered to local markets- work simplification would be ideal. Job enrichment programme would work better if the organization employs skilled labour force. Applying a contingency approach requires that managers diagnose a given situation & adapt to meet the conditions present. The strength of contingency theory rest on two points: - 1. First, it focuses attention on specific situation factors that influence the appropriateness of one managerial strategy over another. 2. Second, it highlights the importance to managers of developing skills in situational analysis. Such skills will help managers find out important contingency factors that influences their approach to managing. The contingency approach is a useful instructional device in the sense that it compels us to be aware of the complexity in every situation and forces us to take an active and dynamic role in trying to determine what would work best in each case. It is said that the contingency approach is refreshing breeze in management literature that clears away the humanistic and general system fog. The contingency theory is concerned with achieving a “fit” between organization and its environment. The contingency approach dose not incorporates all aspects of system theory and hold that it is severely constrained by paucity of literature. Contingency theory is theoretically complex. The goal of integrating functional, quantitative behavioral and system approaches in the form of contingency model may prove to be too difficult to realize because of the incomplete development of the earlier approaches. II. MANAGEMENT FUNCTIONS Management consists of the functions given below. It is based on Henri Fayol's thinking on the functions of management. 1. Planning 2. Organizing 3. Staffing 4. Directing 5. Controlling THE FUNCTIONS OF MANAGEMENT 1. Planning It is the basic function of management. It deals with chalking out a future course of action & deciding in advance the most appropriate course of actions for achievement of pre-determined goals. It bridges the gap from where we are and where we want to be. A plan is a future course of actions. It is an exercise in problem solving and decision making. Planning is determination of courses of action to achieve desired goals. Thus, planning is a systematic thinking about ways and means for accomplishment of pre- determined goals. Planning is necessary to ensure proper utilization of human and non-human resources. 2. Organizing It is the process of bringing together physical, financial and human resources and developing productive relationship amongst them for achievement of organizational goals. According to Henry Fayol, “To organize a business is to provide it with everything useful or its functioning i.e. raw material, tools, capital and personnel’s”. To organize a business involves determining and providing human and non-human resources to the organizational structure. Organizing as a process involves: 1. Identification of activities. 2. Classification of grouping of activities. 3. Assignment of duties. 4. Delegation of authority and creation of responsibility. 5. Coordinating authority and responsibility relationships. 3. Staffing It is the function of manning the organization structure and keeping it manned. Staffing has assumed greater importance in the recent years due to advancement of technology, increase in size of business, complexity of human behavior etc. The main purpose of staffing is to put right man on right job i.e. square pegs in square holes and round pegs in round holes. Staffing involves: 1. Manpower Planning (estimating man power in terms of searching, choose the person and giving the right place). 2. Recruitment, selection & placement. 3. Training & development. 4. Remuneration. 5. Performance appraisal. 6. Promotions & transfer. 4. Directing It is that part of managerial function which actuates the organizational methods to work efficiently for achievement of organizational purposes. It is considered lifespark of the enterprise which sets it in motion the action of people because planning, organizing and staffing are the mere preparations for doing the work. Direction is that inert-personnel aspect of management which deals directly with influencing, guiding, supervising, motivating sub-ordinate for the achievement of organizational goals. Direction has following elements: 1. Supervision 2. Motivation 3. Leadership 4. Communication Supervision- implies overseeing the work of subordinates by their superiors. It is the act of watching & directing work & workers. Motivation- means inspiring, stimulating or encouraging the sub-ordinates with zeal to work. Positive, negative, monetary, non-monetary incentives may be used for this purpose. Leadership- may be defined as a process by which manager guides and influences the work of subordinates in desired direction. Communications- is the process of passing information, experience, opinion etc from one person to another. It is a bridge of understanding. 5. Controlling It implies measurement of accomplishment against the standards and correction of deviation if any to ensure achievement of organizational goals. The purpose of controlling is to ensure that everything occurs in conformities with the standards. An efficient system of control helps to predict deviations before they actually occur. Therefore controlling has the following steps: 1. Establishment of standard performance. 2. Measurement of actual performance.  3. Comparison of actual performance with the standards and finding out deviation if any. 4. Corrective action. -o0o- Reference: ENGINEERING MANAGEMENT LECTURE NOTES by DR. NYAMBANE OSANO (2013)