ENCS 33 Engineering Management Midterm PDF

ENGINEERING MANAGEMENT ENCS 33 - ENGINEERING MANAGEMENT BSCPE 202C | ENGR. ORLANDO P. SOBERANO | S.Y 2023 - 2024 Efficiency vs. Effectiveness PRINCIPLE OF ENGINEERING Efficiency MANAGEMENT...

ENGINEERING MANAGEMENT ENCS 33 - ENGINEERING MANAGEMENT BSCPE 202C | ENGR. ORLANDO P. SOBERANO | S.Y 2023 - 2024 Efficiency vs. Effectiveness PRINCIPLE OF ENGINEERING Efficiency MANAGEMENT ○ Getting work done with minimum of effort, expense or waste; Engineering ○ Doing things right most is the discipline, art, skill and output for least input profession of acquiring and Effectiveness applying scientific, mathematical, ○ Accomplishing tasks that economic, social, and practical help organizational knowledge to design and build objectives; structures, machines, devices, ○ Doing right things systems, materials, and processes that safely realize improvements to the lives of people. Management LEVELS OF MANAGEMENT is the act of getting people together to accomplish desired goals and objectives using available resources efficiently and effectively. Engineering Management it is a specialized form of management that is concerned with the application of engineering principles to actual business practices. Top Level of Management Is the ultimate source of authority WHY DO WE STUDY ENGINEERING MANAGEMENT? and it manages goals and policies for an enterprise. It devotes more To empower engineering time on planning and managers with knowledge and coordinating functions. skills need to lead technical individuals, organizations, or Middle Level of Management processes to success. Responsible to the top management for the functioning FUNCTIONS OF MANAGEMENT of their department. They make plans for the subunits of the organization. Lower Level of Management Is also known as supervisory/operative level of management. They guide and instruct workers for day to day activities. ROLES OF ENGINEERS Engineers develop new technological solutions. During the engineering design process, the responsibilities of the engineer may include defining problems, conducting and narrowing 1 ENGINEERING MANAGEMENT ENCS 33 - ENGINEERING MANAGEMENT BSCPE 202C | ENGR. ORLANDO P. SOBERANO | S.Y 2023 - 2024 research, analyzing criteria, 4. Negotiator Managers negotiate finding and analyzing solutions, schedules, projects, goals, and making decisions. outcomes, resources, and raises Informational Roles HISTORY AND EVOLUTION OF 1. Analyst Engineers break things ENGINEERING MANAGEMENT down into classes and categories, in order to understand them. Frederick Winslow Taylor (1856 - 1915) 2. Architect Engineers make design based on technical feasibility and standards and what the client wants (and sometimes aesthetic fashion). 3. Craftsman Engineers implement the design based on craftsmanship and based on scientific and technical knowledge 4. Automator or Tool Maker Engineers initiate creation of different tools to enhance productivity He is an American Mechanical 5. Designer Engineers make the Engineer who is known today as prototype for a craftwork or who the “Father of Scientific makes scale drawings for a Management”. One of his many machine. contributions to modern 6. Engineers must be concerned with management is the common the application of technology in a practice of giving employees rest systems context, must be breaks throughout the day. pragmatic, must coordinate those Taylor’s Four Management things that must work or fit together Principles ○ Develop a science for each Managerial Roles/Interpersonal Roles element of a man’s work, 1. Figurehead - Managers perform which replaces the old ceremonial duties rule-of-thumb method. 2. Leader - Managers motivate and ○ Scientifically select and then encourage workers to accomplish train, teach, and develop the objectives workman. 3. Liaison - Managers deal with ○ Cooperate with the men to people outside their units ensure all work is done in accordance with the Informational Roles principles of the science. 1. Monitor - Managers scan their ○ There is almost equal environment for information division of the work and the 2. Disseminator - Managers share responsibility between information with others in their management and workmen company 3. Spokesperson - Managers share Frank and Lilian Gilbreth: Time and information with others outside Motion their departments or companies Decisional Roles 1. Entrepreneur Managers adapt to incremental change 2. Disturbance Handler Managers respond to problems that demand immediate action 3. Resource Allocator Managers decide who gets what resources 2 ENGINEERING MANAGEMENT ENCS 33 - ENGINEERING MANAGEMENT BSCPE 202C | ENGR. ORLANDO P. SOBERANO | S.Y 2023 - 2024 Frank and Lilian were a husband formulated the fourteen Principles of and wife team who worked as Management. engineers in the early part of the Fayol's 14 Principles of 20th century. Management Frank is known primarily for his 1. Division of Work – When time and motion studies. \ employees are specialized, output Lilian focused on the human can increase because they become aspects of work and the increasingly skilled and efficient. understanding of workers 2. Authority – Managers must have 'personalities and needs. the authority to give orders, but they must also keep in mind that with Henry L. Gantt (1861 - 1919) authority comes responsibility. 3. Discipline – Discipline must be upheld in organizations, but methods for doing so can vary. 4. Unity of Command – Employees should have only one direct supervisor. 5. Unity of Direction – Teams with the same objective should be working under the direction of one manager, using one plan. This will ensure that action is properly Develop the Gantt Chart which is coordinated. used for scheduling multiple 6. Subordination of Individual overlapping tasks over a time Interests to the General Interest – period. The interests of one employee He focused on motivational should not be allowed to become schemes, emphasizing the greater more important than those of the effectiveness of rewards for good group. This includes managers. work (rather than penalties for poor 7. Remuneration – Employee work). satisfaction depends on fair remuneration for everyone. This includes financial and non-financial compensation. 8. Centralization – This principle refers to how close employees are to the decision making process. It is important to aim for an appropriate Henri Fayol (1841 - 1925) balance. 9. Scalar Chain – Employees should be aware of where they stand in the organization's hierarchy, or chain of command. 10. Order – The workplace facilities must be clean, tidy and safe for employees. Everything should have its place. 11. Equity – Managers should be fair to staff at all times, both maintaining The “Father of Modern discipline as necessary and acting Management Theory”. Fayol with kindness where appropriate. “Divided industrial activities into six 12. Stability of Tenure of Personnel – groups: technical, commercial, Managers should strive to minimize financial, security, accounting employee turnover. Personnel and managerial. He also planning should be a priority. 3 ENGINEERING MANAGEMENT ENCS 33 - ENGINEERING MANAGEMENT BSCPE 202C | ENGR. ORLANDO P. SOBERANO | S.Y 2023 - 2024 13. Initiative – Employees should be 5. Impersonal - Regulations and clear given the necessary level of requirements create distant and freedom to create and carry out impersonal relationships plans. between employees, with the 14. Esprit de Corps – Organizations additional advantage of preventing should strive to promote team spirit nepotism or involvement from and unity. outsiders or politics. 6. Career Employees of a Max Weber (1864 - 1920) bureaucratic organization are selected on the basis of their expertise. This helps in the deployment of the right people in the right positions and thereby optimally utilizing human capital. Mary Parker Follett (1868 - 1933) He is the “Father of Modern Sociology”. He analyzed bureaucracy as the most logical and rational structure for large organizations. Bureaucracies are founded on legal or rational authority which is based on law, procedures and Mary Parker Follett is known today rules. as the “Mother of Scientific Bureaucracy - Literally means to Management“. Her many rule from a desk or office - The contributions to modern exercise of control on the basis of management include the ideas of knowledge, expertise, or negotiation, conflict resolution, experience. and power sharing. 6 Bureaucracy Characteristics: 1. Task Specialisation - every George Elton Mayo (1840 - 1949) employee has a specific place within the organization and is expected to solely focus on his/her area of expertise. 2. Hierarchical layers of authority - reflects lines of bureaucratic communication and the degree of delegation and clearly lays out how powers and responsibilities are divided. “Father of the Hawthorne 3. Formal selection - All employees Studies” - Identified the Hawthorne are selected on the basis of Effect or the bias that occurs technical skills and when people know that they are competencies, which have been being studied. acquired through training, education, and experience. Chester I. Barnard (1886 - 1961) 4. Rules and requirements - Formal rules and requirements are required to ensure uniformity so that employees know exactly what is expected of them. 4 ENGINEERING MANAGEMENT ENCS 33 - ENGINEERING MANAGEMENT BSCPE 202C | ENGR. ORLANDO P. SOBERANO | S.Y 2023 - 2024 He introduced the Systems Theory suggesting that the task of WHO IS A MANAGER? managers is to maintain a system of cooperative effort in a formal Is someone whose primary organization. He suggested a responsibility is to carry out comprehensive social systems management process. In particular, approach to managing. is someone who plans and makes decisions, organizes, leads, and controls human, financial, physical, WHAT IS MANAGEMENT? and information resources. According to Frederick Taylor “Management is knowing exactly THE MANAGEMENT PROCESS what you want (people) to do, and then seeing that it is done in the best and cheapest way. Planning ○ Is a set of activities means setting an organization’s (including planning, decision goals and deciding how best to making, organizing, leading, achieve them. and controlling) directed to an organization’s Decision Making resources (human, a part of the planning process, financial, physical, and involves selecting a course action information) with the aim of from a set of alternatives. achieving organizational goals in an efficient and Organizing effective manner. involves determining how is a process involving planning, activities and resources are to be leading, and controlling the grouped different elements to achieve desired outcome. Leading involves problem solving and is the set of processes used to get decision making (BM, TM, EM) people to work together to advance the interest of the Business Management organization. Management of business to achieve its mission, goals and Controlling objectives. or monitoring the organization’s progress towards its goals. Technology Management is concerned with decision problems, MANAGEMENT IN ORGANIZATIONS at all levels related to the creation and utilization of technological assets and capabilities. Engineering Management management of different engineering activities, for example, R&D, design, manufacture, operations, maintenance etc. MANAGEMENT PROCESS 5 ENGINEERING MANAGEMENT ENCS 33 - ENGINEERING MANAGEMENT BSCPE 202C | ENGR. ORLANDO P. SOBERANO | S.Y 2023 - 2024 Marketing Managers work in areas related to the KINDS OF MANAGER marketing function - getting consumers and clients to buy the Top Manager organization’s products or they make up the relatively small services. group of executives who manage These areas include new product the overall organizations. development, promotion, and Titles found in this group include the distribution. president, vice president, and chief executive officer (CEO). Financial Managers Makes decisions about such Deal primarily with an activities as acquiring other organization’s financial companies, investing in research resources. and development, entering or They are responsible for activities abandoning various markets, and such as accounting, cash building new plants and office management, and investments. facilities. Operation Managers Middle Manager are concerned with creating and is probably the largest group of managing the systems that create managers in most organizations. an organization’s products and Common middle-management titles services. include plant manager, operations Typical responsibilities of operations manager, and division head. managers include production are primarily responsible for control, quality control, plant implementing the policies and layout, and site selection. plans developed by top managers and for supervising and Human Resource Managers coordinating the activities of are responsible for hiring and lower-level managers. developing employees. They are typically involved in human First-Line Manager resource planning, recruiting and supervise and coordinate the selecting employees, training and activities of operating employees. development, designing Common titles for first-line managers compensation and benefits systems, are supervisor, coordinator, and formulating performance appraisal office manager. systems, and discharging Positions such as these are often low-performing and problem the first ones held by employees employees. who enter management from the ranks of operating personnel. Administrative Managers administrative or general managers MANAGEMENT LEVELS are not associated with any Top-level management particular management specialty. ○ (president, executive vice They tend to be generalists; they president) have some basic familiarity with all Middle managers functional areas of management ○ (chief engineer, division head rather than specialized training in etc.) any one area. First-line managers ○ (foreman, supervisor, section Other Kinds of Managers chief) Many organizations have specialized management positions in addition to those already described. MANAGERS IN DIFFERENT AREAS OF Public relations managers - deal THE ORGANIZATIONS with public and media for firms. 6 ENGINEERING MANAGEMENT ENCS 33 - ENGINEERING MANAGEMENT BSCPE 202C | ENGR. ORLANDO P. SOBERANO | S.Y 2023 - 2024 Research and Development specific kind of work being done managers - coordinate the in an organization. activities of scientists and are especially important for engineers working on scientific first-line managers. projects in organizations. such skills are needed to train subordinates and answer questions MANAGER ROLES (What Managers Do) about work related problems. Interpersonal roles Interpersonal Skills Informational Roles is the ability to communicate with, Decisional Roles understand, and motivate individuals and groups. BASIC MANAGER ROLES AND SKILLS As a manager climbs the organizational ladder, they must be Interpersonal Roles able to get along with subordinates, There are three interpersonal roles peers, and those at higher levels of inherent in the manager’s job the organization. a. The manager is often asked to serve they must also be able to work with as figure head suppliers, customers, investors, and b. The manager is also asked to serve others outside of the organization. as a leader c. The managers can have a liaison Conceptual Skills role depends on the manager’s ability to think in the abstract. Informational Roles Managers need the mental capacity There are three informational roles to understand the overall identified workings of the organization and a. Monitor - one who actively seeks its environment, to grasp how all information that may be of value the parts of the organization fit b. Disseminator - transmitting together, and to view the relevant information back to organization in a holistic manner. others in the workplace. This allows them to think c. Spokesperson - relays strategically, to see the “big picture” information to people outside the and to make broad-based decisions unit or outside the organization that serve the overall organization in a holistic manner. Decisional Roles There are four decisional roles Diagnostic Skills identified skills that enable the manager to a. Entrepreneur - the voluntary visualize the most appropriate initiator of change response to a situation. b. Disturbance handler - handling a manager must be able to diagnose such problems as strikes, and analyze a problem in the copyright infringements, and organization by studying its energy shortages. symptoms and then developing a c. Resource allocator - decides how solution. resources are distributed, and with These skills enable him to define his whom he or she will work most problem, recognize its possible closely. causes, focus on the most direct d. Negotiator - enters into negotiations problem, and then solve it. with other groups of organizations as a representative of the company. THE SCIENCE AND THE ART OF MANAGEMENT Technical Skills are skills necessary to The Science and the Art of Management accomplish or understand the Many management problems and issues can be approached in ways 7 ENGINEERING MANAGEMENT ENCS 33 - ENGINEERING MANAGEMENT BSCPE 202C | ENGR. ORLANDO P. SOBERANO | S.Y 2023 - 2024 that are rational, logical, objective, and systematic. Managers can gather data, facts, and objective information. They can use quantitative models and decision-making techniques to arrive at correct decisions. The Art of Management Even though managers may try to be scientific as much as possible, they must often make decisions and solve problems on the basis of intuition, experience, instinct, and personal insights. BECOMING A MANAGER ADVANTAGES OF UNDERSTANDING TECHNOLOGY IN TOP MANAGEMENT Really understanding the business Understanding technology driving the business today and technology that will change the business in future. Treating Research and Development as investment not an expense to be minimized. Spending more time on strategic thinking Dedicating a customer’s problem (true marketing via customer relations Place a premium on innovation WHY ENGINEERING MANAGERS? Competition is global and companies need these people to compete successfully 8 DECISION MAKING ENCS 33 - ENGINEERING MANAGEMENT BSCPE 202C | ENGR. ORLANDO P. SOBERANO | S.Y 2023 - 2024 determine the best option available DECISION MAKING to solve certain problems. Managers of all kinds and types, including the engineer manager, are THE DECISION MAKING PROCESS primarily tasked to provide 1. Diagnose Problem leadership in the quest for the 2. Analyze Environment attainment of the organization’s 3. Articulate Problem or Opportunity objectives. 4. Develop Viable Alternatives The engineer manager’s 5. Evaluate Alternatives decision-making skills will be very 6. Make a Choice crucial to his success as a 7. Implement Decision professional. A major blunder in 8. Evaluate and adapt decision results decision-making may be sufficient to cause the destruction of any 1. Diagnose Problem organization. Good decisions, on A problem exists when there is a the other hand, will provide the difference between an actual right environment for continuous situation and a desired situation. growth and success of any If a manager wants to make an organized effort. intelligent decision, his first move must be to identify the problem. If DECISION MAKING AS A MANAGEMENT the manager fails in this aspect, it is RESPONSIBILITY almost impossible to succeed in the subsequent steps. An expert once Decisions must be made at various said, “identification of the levels in the workplace. They are problem is tantamount to having also made at the various stages in the problem half-solved.” the management process. Decision-making is a responsibility of the engineer 2. Analyze the Environment manager. It is understandable for The environment where the managers to make wrong decisions organization is situated plays a very at times. The wise manager will significant role in the success or correct them as soon as they are failure of such an organization. identified. The objective of environmental Management must strive to analysis is the identification of choose a decision option as constraints, which may be spelled correctly as possible. Since they out as either internal or external have that power, they are limitations. responsible for whatever outcome Examples of internal limitations are their decisions bring. The higher as follows: the management level is, the ○ Limited funds available for bigger and the more complicated the purchase of equipment. decision-making becomes. ○ Limited training on the part of employees. ○ Ill-designed facilities WHAT IS DECISION-MAKING? Examples of external limitations are Decision-making, according to as follows: Nickels and others, “is the heart ○ Patents are controlled by of all the management functions.” other organizations. Decision-making may be defined as ○ A very limited market for the “the process of identifying and company’s products and choosing alternative courses of services exists. action in a manner appropriate to ○ Strict enforcement of local the demands of the situation.” zoning regulations. The definition indicates that the When decisions are to be made, the engineer manager must adapt a internal and external limitations certain procedure designed to must be considered. It may be costly, later on, to alter a decision 1 DECISION MAKING ENCS 33 - ENGINEERING MANAGEMENT BSCPE 202C | ENGR. ORLANDO P. SOBERANO | S.Y 2023 - 2024 because of a constraint that has not The risk characteristics refer to been previously identified. the likelihood of achieving the Components of the Environment goals of the alternatives. The environment consists of two major concerns: 5. Make a Choice 1. Internal Environment After the alternatives have been refers to organizational evaluated, the decision-maker must activities within a firm that now be ready to make a choice. surrounds decision-making. This is the point where he must be 2. External Environment convinced that all the previous refers to variables that are steps were correctly undertaken. outside the organization Choice-making refers to the and not typically within the process of selecting among short-run control of top alternatives representing management. potential solutions to a problem. At this point, Webber advises that 3. Develop Viable Alternatives “...particular effort should be Oftentimes, problems may be made to identify all significant solved by any of the solutions consequences of each choice.” offered. The best among the NOTE: To make the selection alternative solutions must be process easier, the alternatives can considered by management. This is be ranked from best to worst on the made possible by using a procedure basis of some factors like benefit, with the following steps: cost, or risk. 1. Prepare a list of alternative solutions 6. Implement Decision 2. Determine the viability of each After a decision has been made, solutions implementation follows. This is 3. Revise the list by striking out necessary, or decision-making will those which are not viable. be an exercise in futility. Implementation refers to carrying 4. Evaluate Alternatives out the decision so that the After determining the viability of the objectives sought will be alternatives and a revised list has achieved. To make implementation been made, an evaluation of the effective a plan must be devised. remaining alternatives is necessary. At this stage, the resources must be This is important because the next made available so that the decision step involves making a choice. may be properly implemented. Proper evaluation makes According to Aldag and Stearns, choosing the right solution less “those who will be involved in difficult. implementation, must understand How the alternatives will be and accept the solution”. evaluated will depend on the nature of the problem, the objectives of the 7. Evaluate and Adapt Decision Results firm, and the nature of alternatives In implementing the decision, the presented. results expected may or may not According to Souder, “each happen. It is, therefore, important alternative must be analyzed and for the manager to use control and evaluated in terms of its value, feedback mechanisms to ensure cost and risk characteristics.” results and to provide The value of the alternatives information for future decisions. refers to benefits that can be Feedback refers to the process expected. which requires checking at each The cost of the alternative refers stage of the process to assure that to out of pockets costs, the alternatives generated, the opportunity costs, and follow-on criteria used in evaluation, and the costs. solution selected for implementation 2 DECISION MAKING ENCS 33 - ENGINEERING MANAGEMENT BSCPE 202C | ENGR. ORLANDO P. SOBERANO | S.Y 2023 - 2024 are in keeping with the goals and ○ Statistical Decision Theory objectives originally specified. Control refers to actions made to Inventory Models ensure that activities performed consists of several types all match the desired activities or designed to help the manager make goals, that have been set. decisions regarding inventory. In this last stage of the They are as follows: decision-making process, the 1. Economic Order Quantity Model engineer manager will find out - this one is used to whether or not the desired result is calculate the number of achieved. If the desired result is items that should be achieved, one of may assume that ordered at one time to the decision made was good. minimize the total yearly According to Ferrel and Hirt, if the cost of placing orders and desired result was not achieved, carrying the items in further analysis is necessary. inventory. 2. Production Order Quantity Model APPROACHES IN SOLVING PROBLEMS - this is an economic order quantity technique applied In decision-making, the engineer to production orders. manager is faced with problems 3. Back Order Inventory Model which may either be simple or - this is an inventory model complex. To provide him with some used for planned guide, he must be familiar with the shortages. following approaches: 4. Quantity Discount Model 1. qualitative evaluation, and - an inventory model used to 2. quantitative evaluation. minimize the total cost when quantity discounts QUALITATIVE EVALUATION are offered by suppliers. refers to evaluation of alternatives using intuition and subjective Queuing Theory judgment. The queuing theory is one that Stevenson states that managers describes how to determine the tend to use the qualitative approach number of service units that will when: minimize both customer waiting ○ The problem is fairly simple. time and cost of service. ○ The problem is familiar. The queuing theory is applicable to ○ The costs involved are not companies where waiting lines are great (low cost). a common situation. ○ Immediate decisions are Examples are cars waiting for needed. service at a car service center, ships and barges waiting at the harbor for loading and unloading by QUANTITATIVE EVALUATION dockworkers, programs to be run in refers to the evaluation of a computer system that processes alternatives using any technique jobs, etc. in a group classified as rational and analytical Network Models Quantitative Models for These are models where large Decision-Making complex tasks are broken into ○ Inventory Models smaller segments that can be ○ Queuing Theory manage independently. ○ Network Models The two most prominent network ○ Forecasting models are: ○ Regression Analysis 1. The Program Evaluation Review ○ Simulation Technique (PERT) ○ Linear Programming ○ Sampling Theory 3 DECISION MAKING ENCS 33 - ENGINEERING MANAGEMENT BSCPE 202C | ENGR. ORLANDO P. SOBERANO | S.Y 2023 - 2024 - a technique which enables is a model constructed to represent engineer managers to reality, on which conclusions schedule, monitor, and about real-life problems can be control large and complex used. It is a highly sophisticated projects by employing tool by means of which the three-time estimates for decision-maker develops a each activity. mathematical model of the system 2. The Critical Path Method (CPM) under consideration. - this is a network technique Simulation does not guarantee an using only one time factor optimum solution, but it can per activity that enables evaluate the alternatives fed into engineer managers to the process by the schedule, monitor, and decision-maker. control large and complex projects. Linear Programming is a quantitive technique that is Forecasting used to produce an optimum Forecasting may be defined as “the solution wihin the bounds collection of past and current imposed by constraints upon the information to make predictions decision. about the future.” it is also very useful as a There are instances when engineer decision-making tool when supply managers make decisions that will and demand limitations at plants, have implications in the future. warehouses, or market areas are A manufacturing firm, for example, constraints upon the system. must put up a capacity which is sufficient to produce the demand Sampling Theory requirements of customers within is a quantitive technique where the next 12 months. As such. samples of populations are manpower and facilities must be statistically determined to be procured before the start of used for a number of processes, operations. To make decisions on such as quality control and capacity more effective, the marketing research. engineer manager must be provided When data gathering is expensive, with data on demand requirements sampling provides an alternative. for the next 12 months. This type of Sampling, in effect, saves time information may be derived through and money. forecasting. STATISTICAL DECISION THEORY Regression Analysis The regression model is a Decision theory refers to the forecasting method that examines rational way to conceptualize, the association between two or analyze, and solve problems in more variables. It uses data from situations involving limited, or previous periods to predict future partial information about the events. decision environment. Regression Analysis may be simple A more elaborate explanation of or multiple depending on the decision theory is the decision number of independent variables making process presented at the present. When one independent beginning of this chapter. What has variable is involved, it is called not been included in the discussion simple regression: when two or on the evaluation of alternatives, but more independent variable are is very important, is subjecting the involved, it is called multiple alternatives to Bayesian Analysis. regression. The purpose of Bayesian Analysis is to revise and update the initial assessments of the event Simulation probabilities generated by the 4 DECISION MAKING ENCS 33 - ENGINEERING MANAGEMENT BSCPE 202C | ENGR. ORLANDO P. SOBERANO | S.Y 2023 - 2024 alternative solutions. This is Fear of committing mistake, or achieved by the use of additional being criticized by one’s decision information. Fear of facing the consequences Bayes Criterion is when the of one’s decision decision maker is able to assign probabilities to the various STEPS IN DECISION MAKING 4C’s events. Bayes Criterion selects the decision alternative having the STEP 1: Clarify the concern maximum expected payoff, or the Clearly identify the decision to be minimum expected loss if he is made or the problem to be solved. working with a loss table. Identify what is the concern or the challenge that you are facing. IMPORTANCE OF MAKING STEP 2: Check for options EFFECTIVE/HEALTHY DECISIONS Think about all possible and A healthy decision helps us meet available options you have. our goals. A healthy decision minimizes our STEP 3: Consider all consequences mistakes and regrets in life. Think about the positive and A healthy decision builds our negative consequences for each self-esteem/confidence option BARRIERS TO EFFECTIVE STEP 4: Choose the best ption PROBLEM-SOLVING/DECISION-MAKING The best choice are those that will answer your concerns, solve your No. 1: “Go with the Flow” problems, and has more positive Choosing to do (or believe) consequences. certain things simply because other people are doing or believing those things Giving in to peer or family pressure even if it’s not good for you Failing to take all the facts into consideration No. 2: “False Assumption” Having false belief that you can predict what will happen in the future Believing that you are good at making decisions, so you don’t need to put much effort into it No. 3: “Entrapment” Continuing to pursue a certain course of action because you’ve already devoted money, time, or effort to it – even if it’s not helpful or appropriate anymore Incorrectly believing that things will change or improve by investing even more money, time, or effort No. 4: “Lack of Confidence” Not believing in one’s capacity to decide 5 ROOT-CAUSE ANALYSIS ENCS 33 - ENGINEERING MANAGEMENT BSCPE 202C | ENGR. ORLANDO P. SOBERANO | S.Y 2023 - 2024 deepest, underlying reasons for the WHAT IS ROOT CAUSE ANALYSIS? issue. Root Cause Analysis (RCA) is a Recommend solution systematic and structured After identifying the root causes, the problem-solving technique used next step is to develop and to identify the fundamental or recommend appropriate solutions to underlying causes of a particular address them. These solutions issue, problem, or failure. should be targeted and effective in The primary objective of RCA is to preventing the problem from understand why the problem recurring. occurred, rather than just addressing its symptoms. By getting to the root cause, organizations can BENEFITS OF ROOT CAUSE ANALYSIS implement effective solutions to Root cause analysis (RCA) offers prevent the problem from recurring several significant benefits to in the future. organizations and individuals alike. Some of the key advantages PROCESS OF CONDUCTING ROOT include: CAUSE ANALYSIS ○ Problem resolution ○ Preventing recurrence Define the problem ○ Continuous Improvement Gather data Identify possible causes Analyze Root Causes Problem resolution Recommend solution RCA helps in addressing the underlying causes of problems, rather than just dealing with their Define the problem symptoms. By identifying and The first step is to clearly define the eliminating root causes, problem or issue that needs to be organizations can effectively resolve addressed. It is essential to have issues and prevent their recurrence. a precise and well-defined problem statement to guide the analysis. Preventing recurrence Understanding the root causes of problems enables organizations Gather Data to implement preventive Data collection is a crucial phase of measures to avoid future RCA. It involves collecting occurrences. This proactive relevant information, facts, and approach reduces the likelihood of data related to the problem. This repeated issues, saving time and may include examining documents, resources. conducting interviews, and analyzing historical data. Continuous improvement RCA is a crucial component of a Identify possible causes continuous improvement culture. It Once the data is collected, identify encourages organizations to potential causes, this can be done learn from mistakes, identify through various techniques such as opportunities for enhancement, brainstorming, cause-and-effect and make data-driven decisions diagrams (fishbone diagrams), to achieve better outcomes. and conducting interviews with stakeholders. WHAT ARE THE TOOLS OF ROOT Analyze Root Cause CAUSE ANALYSIS? In this phase, the potential causes are analyzed to determine which Fishbone Diagram (Ishikawa Diagram or ones are the root causes of the Cause and Effect Diagram) problem. RCA aims to identify the 1 ROOT-CAUSE ANALYSIS ENCS 33 - ENGINEERING MANAGEMENT BSCPE 202C | ENGR. ORLANDO P. SOBERANO | S.Y 2023 - 2024 to a problem, providing insights into potential root causes. BRAINSTORMING Brainstorming sessions involving cross-functional teams can generate a wide range of potential root causes. It This visual tool helps identify encourages creativity and diverse potential root causes by perspectives. categorizing possible causes into different branches based on Root Cause Analysis (RCA) is a specific categories, such as powerful problem-solving people, processes, equipment, technique that delves beyond environment, and materials. surface issues to identify the underlying causes of challenges 5 WHYS and failures. By understanding the root causes, individuals and organizations can make informed decisions and implement effective solutions, leading to success in any endeavor. This technique involves asking “why” repeatedly (usually five times) to trace back to the fundamental cause of a problem. It helps in exploring deeper layers of causation beyond the obvious symptoms. SCATTER DIAGRAM Also known as a scatter plot, this tool helps identify potential correlations between two variables. It can reveal patterns or trends that may lead to insights about root causes. SWOT ANALYSIS A SWOT analysis assesses the strengths, weaknesses, opportunities, and threats related 2