Engineering Management Introduction PDF

Engineering Management Introduction Introduction Definition of Engineer Definition of Management Managerial Skills Managerial Roles Functions of Managers Definition of Engineering Management 02 What is an Engineer? Ingenium (Latin)...

Engineering Management Introduction Introduction Definition of Engineer Definition of Management Managerial Skills Managerial Roles Functions of Managers Definition of Engineering Management 02 What is an Engineer? Ingenium (Latin) - Skillful, talent, natural capacity or clever invention, - Early applications of clever inventions based on military, - Builders of talent military machines. 03 What is an Engineer? Modern Definition of Engineering By ABET (Accrediting Board for Engineering and Technology);The profession in which a knowledge of the technical, mathematical and natural sciences gained by study, experience and practice is applied with judgement to develop ways economically in order to utilize the materials and forces of the nature for the benefit of mankind. 04 What is an Engineer? Engineer : A person applying his mathematical and science knowledge properly for mankind. 05  What is Management? Directing the actions of a group to achieve a goal in most efficient manner Getting things done through other people Process of achieving organizational goals by working with and through people and organizational resources 06 What is Management? Top-level management president, Executive vice president Middle-level management First-line management chief engineer,division head etc foreman, supervisor,section chief 07  Middle-level management What is Manage through other managers Make plans of intermediate range to achieve Management? the long-range goals set by top management Establish departmental policies First-line management Evaluate the performance of subordinate work units & their managers Directly supervise non-managers.Carry out Provide, Integrating and coordinating the plans and objectivesof higher function management using thepersonnel & other Orchestrate the decisions & activities of first- resources assignedto them line management. Short-range operating plans governing what will be done tomorrow or next week Assign tasks to their workers,supervise the work that is done and Evaluate the performance of workers. 08 What is Management? Top-level management Represent the the whole enterprise Responsible for defining the character,mission and objectives of the enterprise Establish & review criterias for long-range plans Evaluate the performance of majordepartments. 09  Managers need three (3) types of skills: Technical Interpersonal Specific subject related skills Skills related to dealing suchas engineering, accounting, withothers and leading, etc motivating or controlling them. Conceptual Ability to realize the criticalfactors that will determine asorganization’s success or failure.Ability to see the forest in spiteof the trees. 10 Managerial Skills 11 Managerial Roles (What Managers Do) Interpersonal roles Informational Roles Decisional Roles 12 13  Informational Roles Monitor Role: Collects information about internal operations and external events Disseminator Role: Transforms information internally to everybody in organization (like a telephone switchboard) Spokesman Role: Public relations 14  Decisional Roles Entrepreneurial Role: Initiates changes, assumes risks, transforms ideas into useful products Disturbance Handler Role: Deals with unforeseen problems and crisis. Resource Allocator Role: Distributing resources Negotiator Role: Bargains with suppliers, customers etc. in favor of enterprise 15  Functions of Managers Planning: Selecting missions and objectives. Requires decision making. Organizing: Establishing the structure for the objective. Staffing: Keeping filled the organization structure Leading: Influencing people to achieve the objective Controlling: Measuring and correcting the activities 16 Function of Managers 17 Function of Managers 18 Function of Managers 19 What is Engineering Management? 20 What is Engineering Management? 21 What is Engineering Management? 22 FUNCTION OF ENGINEERING MANAGEMENT Planning Key takeaways: Things to discuss: Explain the importance of planning Identify mission and vision Explain the roles of goal and objectives Identify the type of planning Describe the SWOT analysis Key takeaways:  Nature of Planning The general who wins a battle makes many calculations in his temple before the battle. The general who loses a battle makes few calculations before hand. It is by attention to this point that you can see who is likely to win or lose.  Planning Planning to decide in advance It is probably the most important of the who will do what identified managerial functions. how, where, It focuses you on how best to achieve the desired results. when, and with which resources Thus, without it organizing, leading, and controlling have little purpose. The purpose of planning is to enhance the effectiveness and efficiency of the company by providing focus and direction. Types of Planning Operational planning Strategic planning Operational Planning (M+L) to define the specific tactics and action steps needed to accomplish the goal specified by top management. (M) break down the company goals into short term objectives. (L) specify events and tasks that can be implemented with the least amount of resources within the shortest period of time. Operational planning ensures that the company applies its resources efficiently to achieve its stated goals.  Operational Planning A process of analysis - a corporate goal is broken down into steps. These steps are then formalized for easy implementation Focuses on the preservation and rearrangement of established categories Programming task that is aimed at making various given strategies operational Operational Planning Also called platform-based planning results are predictable because they are based on solid knowledge rather than assumptions Is easier for engineers to accomplish because past experience and example are usually available as references. Strategic Planning  Starting at the Top Vision statement of a company’s purpose brief, inspirational, clear, and consistent with company beliefs and values Mission flows from the vision specific, unifying goal that stretches and challenges the organization and has a timeframe Strategic Planning Once a mission is chosen, an organization needs to achieve that mission. Strategic planning is the organized process for selecting these strategies. Strategic planning is the strategy which defines how the organization plans to move from its current state to the state envisioned in its mission and vision frameworks. Strategic Planning  W Tools for Planning Market Research SWOT Analysis Financial What-if Analysis and Modeling Performance Benchmarks Technology Forecasting Product Life-Cycle Analysis Tool of Analysis (SWOT)  Strengths and Weaknesses Internal Factor A strength could be: Your specialist marketing expertise. A new, innovative product or service. Location of your business. Quality processes and procedures. Any other aspect of your business that adds value to your product or service. A weakness could be: Lack of marketing expertise. Undifferentiated products or services (i.e. in relation to your competitors). Location of your business. Poor quality goods or services. Damaged reputation.  A threat could be: nA new competitor in An opportunity could be: Opportunities and nA developing market such as the Internet. your home market. nPrice wars with Threats nMergers, joint ventures or competitors. nA competitor has a strategic alliances. new, innovative nMoving into new market External Factor product or service. segments that offer nCompetitors have improved profits. superior access to nA new international channels of market. distribution. nA market vacated by an nTaxation is ineffective competitor. introduced on your product or service.  Simple Rules for Successful SWOT Analysis Be realistic about the strengths and weaknesses of your organization when conducting SWOT analysis. SWOT analysis should distinguish between where your organization is today, and where it could be in the future. SWOT should always be specific. Avoid grey areas. Always apply SWOT in relation to your competition i.e. better than or worse than your competition. Keep your SWOT short and simple. Avoid complexity and over analysis FUNCTION OF ENGINEERING MANAGEMENT Planning Key takeaways: Things to discuss: Explain the importance of planning Identify mission and vision Explain the roles of goal and objectives Identify the type of planning Describe the SWOT analysis Key takeaways:  Nature of Planning The general who wins a battle makes many calculations in his temple before the battle. The general who loses a battle makes few calculations before hand. It is by attention to this point that you can see who is likely to win or lose.  Planning Planning to decide in advance It is probably the most important of the who will do what identified managerial functions. how, where, It focuses you on how best to achieve the desired results. when, and with which resources Thus, without it organizing, leading, and controlling have little purpose. The purpose of planning is to enhance the effectiveness and efficiency of the company by providing focus and direction. Types of Planning Operational planning Strategic planning Operational Planning (M+L) to define the specific tactics and action steps needed to accomplish the goal specified by top management. (M) break down the company goals into short term objectives. (L) specify events and tasks that can be implemented with the least amount of resources within the shortest period of time. Operational planning ensures that the company applies its resources efficiently to achieve its stated goals.  Operational Planning A process of analysis - a corporate goal is broken down into steps. These steps are then formalized for easy implementation Focuses on the preservation and rearrangement of established categories Programming task that is aimed at making various given strategies operational Operational Planning Also called platform-based planning results are predictable because they are based on solid knowledge rather than assumptions Is easier for engineers to accomplish because past experience and example are usually available as references. Strategic Planning  Starting at the Top Vision statement of a company’s purpose brief, inspirational, clear, and consistent with company beliefs and values Mission flows from the vision specific, unifying goal that stretches and challenges the organization and has a timeframe Strategic Planning Once a mission is chosen, an organization needs to achieve that mission. Strategic planning is the organized process for selecting these strategies. Strategic planning is the strategy which defines how the organization plans to move from its current state to the state envisioned in its mission and vision frameworks. Strategic Planning  W Tools for Planning Market Research SWOT Analysis Financial What-if Analysis and Modeling Performance Benchmarks Technology Forecasting Product Life-Cycle Analysis Tool of Analysis (SWOT)  Strengths and Weaknesses Internal Factor A strength could be: Your specialist marketing expertise. A new, innovative product or service. Location of your business. Quality processes and procedures. Any other aspect of your business that adds value to your product or service. A weakness could be: Lack of marketing expertise. Undifferentiated products or services (i.e. in relation to your competitors). Location of your business. Poor quality goods or services. Damaged reputation.  A threat could be: nA new competitor in An opportunity could be: Opportunities and nA developing market such as the Internet. your home market. nPrice wars with Threats nMergers, joint ventures or competitors. nA competitor has a strategic alliances. new, innovative nMoving into new market External Factor product or service. segments that offer nCompetitors have improved profits. superior access to nA new international channels of market. distribution. nA market vacated by an nTaxation is ineffective competitor. introduced on your product or service.  Simple Rules for Successful SWOT Analysis Be realistic about the strengths and weaknesses of your organization when conducting SWOT analysis. SWOT analysis should distinguish between where your organization is today, and where it could be in the future. SWOT should always be specific. Avoid grey areas. Always apply SWOT in relation to your competition i.e. better than or worse than your competition. Keep your SWOT short and simple. Avoid complexity and over analysis  SWOT Analysis Examples Example 1 - Starbucks SWOT Analysis. Strengths - Starbucks Corporation is a very profitable organisation, earning in excess of $600 million in 2004. Weaknesses - Starbucks has a reputation for new product development and creativity. Opportunities - New products and services that can be retailed in their cafes, such as Fair Trade products. Threats - Starbucks are exposed to rises in the cost of coffee and dairy products.  SWOT Analysis Examples Example 2 - Nike SWOT Analysis. Strengths - Nike is a very competitive organisation. Phil Knight (Founder and CEO) is often quoted as saying that 'Business is war without bullets. Weaknesses - The organisation does have a diversified range of sports products. Opportunities - Product development offers Nike many opportunities. Threats - Nike is exposed to the international nature of trade. SWOT Analysis Exercise SWOT Analysis Exercise Highly Brill Leisure Center has hired you to help them with their marketing decision making. Perform a SWOT analysis on Highly Brill Leisure Center, based upon the following issues: 1. The Center is located within a two-minute walk of the main bus station, and is a fifteen-minute ride away from the local railway station. 2. There is a competition standard swimming pool; although it has no wave machines or whirlpool equipment as do competing local facilities. 3. It is located next to one of the largest shopping centers in Britain. 4. It is one of the oldest centers in the area and needs some cosmetic attention. 5. Due to an increase in disposable income over the last six years, local residents have more money to spend on leisure activities. 6. There has been a substantial decrease in the birth rate over the last ten years. 7. In general people are living longer and there are more local residents aged over fifty-five now than ever before. 8. After a heated argument with the manager of a competing leisure center, the leader of a respected local scuba club is looking for a new venue. 9. The local authority is considering privatizing all local leisure centers by the year 2000. 10. Press releases have just been issued to confirm that Highly Brill Leisure Center is the first center in the area to be awarded quality assurance standard BS EN ISO 9002. 11. A private joke between staff states that if you want a day-off from work that you should order a curry from the Center's canteen, which has never made a profit. 12. The Center has been offered the latest sporting craze. 13. Highly Brill Leisure Center has received a grant to fit special ramps and changing rooms to accommodate the local disabled. 14. It is widely acknowledged that Highly Brill has the best-trained and most respected staff of all of the centres in the locality Answer Answer: As you can see the answer does not completely agree with yours. This does not mean that you are wrong. It simply means that the results of your analysis are represented in a different way. Points 2 and 10 are difficult to place. Point 2 depends on whether or not wave machines or a whirlpool have a distinct competitive advantage over a competition standard pool. Point 10 is an internal strength and an external opportunity. Strategic Planning There are essentially eight key areas for establishing objectives: Market share Innovation Productivity Physical and Financial Resources Manager Performance and Development Worker Performance and Attitude Profitability Social Responsibility  What Really Works Management by Objectives (MBO) Based on: goals participation Feedback Develop work assignments based on organizational needs and objectives. Plans are agreed between manager and subordinate. Objectives should be stretch objectives Needed resources should be determined and agreed to. Plans should include employee development as well. Plans are for a 6 month to 1 year time span. Planning Concepts Responsibility for Planning Planning Premises Planning Horizon System of Plans Policies and Procedures  Planning Timeframes Exhibit 4.4  Planning Roles of Engineering Managers Planning guidelines i. Assist their own superiors in planning ii. Ask for support from subordinates iii. Develop active plans - Time management - Projects and programs - Corporate know-how - Proactive tasks  i) Assist their own Superiors in Planning a. Analysing hard data (industry, competition and marketing) b. Offering alternative interpretation to data available c. Raising insightful questions to challenge conventional assumptions d. Communicating the resulting outputs of planning ii) Ask for Support from Subordinates To optimally benefit from the knowledge, expertise, and insights of staff  iii) Develop Active Plans Time management – plan and prioritise their personal daily tasks Projects and programs – understand project objectives, carefully select staff members with relevant skills and integrate all input to draft a project plan. Corporate know-how – documental knowledge (patents, etc), problem- solving expertise Proactive tasks – utilising new technologies, looking for business partners, offering new services to customers, develop new products. How to Make a Plan That Works  Setting Goals (Vision) Specific Clear and unambiguous goal Measurable Concrete criteria for measuring progress Attainable Goals that are realistic and attainable Realistic “Do-able” Timely Within a time frame SMART - Example Take for example the case of a manager who would like to see an improvement in the time taken and number of steps it takes to place an order on an ecommerce site. The manager might phrase the objective: Understand the purchase process Looking carefully at the above objective and you’ll notice some problems in the phrasing of the objective. SMART The problems that come to mind are: S: How will the manager know what to do? The verb understand is not really specific! M: How will the manager measure the progress towards achieving this objective? The objective does not have any measurable item. A: Is it an achievable objective? If it isn’t, then de-motivation creeps in. R: Is it a realistic objective? For example, if the manager does not have the skills or resources, the objective may not be achievable. In the example above, as there is no timeline associated, the objective is vague. Also, the manager may not have the supported resources. T: By when should the objective be met? Time-line is critical. Humans work towards goals based on some pressure applied by the time of completion. Hence, objectives should be time-bound. SMART The objective mentioned above can be rephrased to: Decrease the number of steps required to complete an order by 30% by the end of this quarter.  Goal (Vision) Commitment The determination to achieve a goal. Increased by: Setting goals participatively Making goals reasonable Making goals public Obtaining top management support  Developing an Effective Action Plan For accomplishing a goal an action plan lists: Specific steps People Resources Time period  Tracking Progress First method Set proximal (i.e., short-term) goals Set distal (i.e., long-term or primary) goals Second method Gather and provide feedback Make adjustments in effort, direction, and strategies  Maintaining Flexibility Options-based planning keep options open through simultaneous investment invest more in promising options Learning-based planning plans need to be continually tested, changed and improved encourages frequent reassessment and revision of goals  Setting Missions Targeting setting a clear, specific target Common-enemy mission vowing to defeat a corporate rival Role-model mission emulating a successful company (Benchmarking) Internal-transformation mission aiming to achieve dramatic change to remain competitive  Bending in the Middle Tactical Plans specify how a company will use resources, budgets, and people to accomplish goals Management by Objectives (MBO) develop and carry out tactical plans four steps discuss goals participatively select goals jointly develop tactical plans meet to review performance  Finishing at the Bottom Operational plans day-to-day plans Single-use plans deal with unique, one-time-only events Standing plans plans for recurring events three types Policies (guide for decision making) Procedures (sequence of activities to accomplish a desire purpose) Rules and regulations (do not permit discretion) Budgets Determine the basic units (man-hours, weeks) Estimate total resources  Special-Purpose Plans Planning for Change Planning for Dr Wan Azlan / Dr Nordiana Contingencies Planning for Product Development 26  Planning for Change Stretch goals extremely ambitious goals that you don’t know how to reach Benchmarking identifying outstanding practices, processes, and standards in other companies adapting them to your company  Planning for Contingencies: Scenario Planning Define the scope of the Using steps 1-4 create scenario initial scenarios Identify the major Check each scenario stakeholders for consistency Identify environmental Create contingency trends plans from each Identify key scenario uncertainties and Develop measures to outcomes indicate when scenario events are occurring  Planning for Product Development Aggregate product plans: used to manage and monitor all new products indicate resources being used for each product indicate product’s place in company’s plans help avoid having too many products in development That’s all for this chapter… Any Question?  1 KNR4553 Engineering Management Semester 1 21/22 ORGANIZING  2 Learning objectives for today.. Definition Importance of Organizing Elements of Organization  3 How to Define… ?? Organizing: Process of determining: ▫ the activities to be performed, ▫ arranging these activities to administrative units, ▫ as well as assigning managerial authority and responsibilities  to people employed in the organization.  4 Importance of Organizing Focus on, and facilitate the attaining of, objectives. Arrangement of positions and jobs within the hierarchy. Define responsibilities and line of authority of all levels. Creating relationships that will minimize friction.  5 Basic Elements of Formal Organizations Centralization and decentralization. Delegation of authority. Span of control (supervision). Division of service. Departmentation.  6 1. Centralization and Decentralization: o i.e., the level at which most of the decisions are made within the organization. o Centralization o Concentration of decision-making and action at high level management. o Decentralization o Consistent delegation of authority to the lower levels where the work is performed  7 Centralization Advantages Disadvantages 1. Provide Power and 1. Neglected functions for prestige for manager. mid. Level, and less motivated bedside 2. Promote uniformity of personnel. policies, practices and decisions. 2. Nursing supervisor 3. Minimize duplication of functions as a link officer function is. between nursing director and first-line 4. Minimal extensive management. controlling procedures and practices.  8 Decentralization Advantages:  Raise morale and promote interpersonal relationships.  Relieve from the daily administration.  Bring decision-making close to action.  Develop Second-line managers.  Promote employee’s enthusiasm and Coordination.  Facilitate actions by lower-level managers.  Improves coordination,, especially for services.  9 Decentralization Disadvantages:  Top-level administration may feel it would decrease their status.  Managers may not permit full and maximum utilization of highly qualified personnel.  Increased costs. It requires more managers and large staff.  It may lead to overlapping and duplication of effort.  It may lead to lack of uniformity and lowering of standards in decision-making.  Emergency decision may not be possible.  10 2. Delegation of Authority Delegation:  Process of assigning work  from a top organizational level to a lower one or  from superior to subordinate, and  giving that person the authority to accomplish them.  A downward flow of authority from HIGHER level in the organization to LOWER level.  11 The Delegation Process Allocation of duties. Delegation of authority. Assignment of responsibility. Creation of accountability. Accountability: subordinates must be held answerable to their carried out duties.  12 Factors Determining Degree of Authority Delegation: Organization’s size. Importance of duty or decision. Task complexity. Organizational culture. Qualities of subordinates.  13 Main Principles of Delegation Responsibility can Authority and not be delegated. responsibility should be in equal Proportion.  14 Barriers to Successful Delegation Lack of superior’s ability to direct the subordinates. Lack of confidence in subordinate. Absence of control.  15 Major Causes of Managers’ Refusal to Delegate Tendency to do things personally. Desire to dominate the knowledge, information, and/or skills. Unwillingness to accept risks of wrongs.  16 Reasons for Subordinates’ Avoidance of Accepting Delegation Decision-making is a hard mental work, and people seek ways off avoiding it. Fear off criticism for mistakes. Lack off necessary information and resources to do a good job. Overload of work. Positive incentives may be inadequate.  17 How to Define… ? Authority : The right to take final decisions, to act or to command action of others. It moves in a downward direction.  18 Types of Authority Ultimate authority. Legal authority. Technical authority. Operational authority.  19 How to Define… ?? Responsibility: The obligation involved when one accepts an assignment. It cannot be delegated, ▫ it may be continued or it may be terminated with the accomplishment of a single action.  20 Types of Organizational Relationships The line relation ▫ presents levels of hierarchy, superior-subordinate relationships, and provides the framework for the organization. ▫ It is showed by a solid line in the organizational chart Staff relation ▫ has no command, personnel have only the right to advise, assist, support those in the line authority in the performance of their duties, it is showed by a dotted line in organizational chart.  21 Line & Staff Relationships  22 3. Span of Control: Number of subordinates that can be adequately supervised by one supervisor. Dimensions of Span of Control ▫ Narrow span of control. ▫ Wide span of control.  23 Narrow Span of Control The manager supervises a small number of workers.  24 Narrow Span of Control Advantages:  Close supervision.  Close control.  Fast communication between subordinates and superiors. Disadvantages:  Superiors tend to get too involved in subordinates’ work.  Many levels of management.  High costs due to many levels.  25 Wide Span of Control The manager supervises a large number of workers.  26 Wide Span of Control Advantages:  Superiors are forced to delegate.  Clear policies must be made.  Subordinates must be carefully selected. Disadvantages:  Tendency of overload superiors to take most or all decisions.  Danger of superior’s loss of control.  Requires exceptional quality of managers.  27 Tall versus Flat Organizations Tall ▫ A management structure characterized by an overall narrow span of management and a relatively large number of hierarchical levels. ▫ Tight control. ▫ Reduced communication overhead. Flat ▫ A management structure characterized by a wide span of control and relatively few hierarchical levels. ▫ Loose control. ▫ Facilitates delegation.  28 Tall versus Flat Organizations  29 Factors Determining the Span of Control The competence of both the supervisor and the subordinate. The degree of interaction between the units or personnel being supervised. Other duties of the top manager. Lower-level managers have a wider range of span than top- level manager. The similarity or dissimilarity of activities being supervised.  30 Factors Determining the Span of Control The incidence of new problems in the unit. Availability of plans of work, policies and standardized procedures. The degree of physical distribution. The nature of work (stability, complexity, etc…).  31 4. Division of Service  Dividing large activities to be distributed among several people. Advantages  Allow an employee to master a task with a maximum skill, a minimum time and effort. Disadvantages:  Creates many different, narrow jobs, which need effective managerial coordination.  Human problems have been created from division of service, fatigue and stress, and which lead to less quantity and quality of work, increased absenteeism and higher turnover  32 5. Departmentation Types of Departmentation: ▫ by services ▫ by time ▫ by degree off acuteness off illness ▫ by function ▫ by location ▫ by patient  33 ANY QUESTIONS ??? Leadership – “the ability to get men to do what they don’t want to do and like it” President Harry S. Truman  To explain the difference between leader and manager To describe the nature of leadership and its significance to an organization To address the application of leadership character in current organizations To recognize the different views of motivation  Planning Organizing Controlling Leading  Who is your favourite leader in our country? Describe with justification: Physical qualities Personal attributes Character attributes Intellectual qualities  McCoby defines leadership as: a relationship between the leader and the follower and management as a function Leader uses passion and emotion Manager uses formal and rational method  Manager Leaders Administer Innovate Ask how and when Ask what and why Focus on system Focus on people Do things right Do the right things Maintain Develop Short-term perspective Longer term Imitate Originate Are a copy Are original  Physical qualities Personal attributes Character attributes Intellectual qualities  to identify the personal characteristics that made for effective leader such as: Myers- Briggs Type Indicator (MBTI) –ENTJ vs ISFP The Leadership Grid Michigan and Ohio State Studies Situational Approaches  E (Extraversion) – focused on I (Introversion) – focused on the outer world of people and the inner world of ideas and things impressions) N (Intuition) – focused on the S (Sensing) – focused on the future with a view toward present and on concrete patterns and possibilities information gained from the senses T (Thinking) – basing decisions on logic and on F (Feeling) – basing decisions objective analysis of cause and on values and on subjective effect evaluation of person centered concerns. J (Judging) – preferring to have things settled – a planned P (Perceiving) – preferring to and organized approached to keep your options open- a life flexible and spontaneous approach to life If you’re the leader, which type of approach will be implemented in your organisation? A Minimum effort to get the work done. A basically lazy approach that avoids as much work as possible. B Strong focus on task, but with little concern for people. Focus on efficiency, including the elimination of people wherever possible. C Care and concern for the people, with a comfortable and friendly environment and collegial style. But a low focus on task may give questionable results. D A weak balance of focus on both people and the work. Doing enough to get things done, but not pushing the boundaries of what may be possible. E Firing on all cylinders: people are committed to task and leader is committed to people (as well as task).  Leaders may be concerned for their people and they also must have some concern for the work to be done. The question is, how much attention to they pay to one or the other? This is a model defined by Blake and Mouton in the early 1960s.  This is a model defined by Blake and Mouton in the early 1960s Country Club High Team management management Concern for Middle of the road Medium People management Impoverished Authority- Low management compliance Low Medium High Concern for Production (Task)  Impoverished management Minimum effort to get the work done. A basically lazy approach that avoids as much work as possible. Authority-compliance Strong focus on task, but with little concern for people. Focus on efficiency, including the elimination of people wherever possible. Country Club management Care and concern for the people, with a comfortable and friendly environment and collegial style. But a low focus on task may give questionable results.  Middle of the road management A weak balance of focus on both people and the work. Doing enough to get things done, but not pushing the boundaries of what may be possible. Team management Firing on all cylinders: people are committed to task and leader is committed to people (as well as task).  Tannenbaum and Schmidt proposed a continuum of leadership style extending from: complete retention of power by the manager to complete freedom for subordinates Autocratic (“Telling”). Manager makes decisions with little or no involvement of non- managers Diplomatic (“Selling”). Manager makes decisions without consultation but tries to persuade nonmanagers to accept them (and might even modify them if they object strongly)  Consultative (“Consulting”). Manager obtains nonmanagers‟ ideas and uses them in decision making. Participative (“Joining”). Manager involves nonmanagers heavily in the decision (and may even delegate it to them completely).  An important part of Leadership Robbins defines motivation – “the willingness to apply high levels of effort to reach organizational goals, conditioned by the effort‟s and ability to satisfy some individual need” Douglas McGregor - Theory X Y  McGregor maintained that there are two fundamental approaches to managing people. Many managers tend towards Theory X, and generally get poor results. Enlightened managers use Theory Y, which produces better performance and results, and allows people to grow and develop.  The average person dislikes work and will avoid if he/she can. Therefore most people must be forced with the threat of punishment to work towards organizational objectives. The average person prefers to be directed; to avoid responsibility; is relatively unambitious, and wants security above all else.  Effort in work is as natural as work and play. People will apply self-control and self-direction in the pursuit of organizational objectives, without external control or the threat of punishment. Commitment to objectives is a function of rewards associated with their achievement. People usually accept and often seek responsibility. The capacity to use a high degree of creativity in solving organizational problems. In industry, the intellectual potential of the average person is only partly utilized.  intolerant anti-social issues deadlines does not thank or praise distant and detached seeks culprits for failures or shortfalls aloof and arrogant does not invite or welcome short temper suggestions issues instructions, directions, takes criticism badly and likely issues threats to make people to retaliate if from below or follow instructions peer group demands, never asks poor at proper delegating - but does not participate believes they delegate well does not team-build thinks giving orders is delegating unconcerned about staff relatively unconcerned with welfare, or morale investing in anything to gain one-way communicator future improvements poor listener unhappy fundamentally insecure and possibly neurotic  Theory Z is often referred to as the 'Japanese' management style Japanese management, which places a large amount of freedom and trust with workers, and assumes that workers have a strong loyalty and interest in team-working and the organization.  Places more reliance on the attitude and responsibilities of the workers, whereas Mcgregor's XY theory is mainly focused on management and motivation from the manager's and organization's perspective.  Two approaches to understanding motivation Content Theories Process Theories Maslow Hierarchy of Equity Theory Needs Expectancy Thoery Herzberg‟s Two-Factor Theory The Porter-Lawler Extension Behaviour Modification  Helps to explain how these needs motivate us all. States that we must satisfy each need in turn, starting with the first, which deals with the most obvious needs for survival itself. Follow the sequence. If the things that satisfy our lower order needs are swept away, we are no longer concerned about the maintenance of our higher order needs Two Factor Theory distinguishes between: Hygiene factors such as company policies, supervisory practices, or wages/salary. Are needed to ensure an employee is satisfied. Motivation factors are needed in order to motivate an employee to higher performance, Classified our actions and how and why we do them, for example, if you perform a work related action because you have to then that is classed as movement, but if you perform a work related action because you want to then that is classed as motivation. Hygiene Factors Motivator Factors Salary Recognation Working condition Work itself Company policies Responsibility Relationship with boss Advancement Relationship with peers Achievement  Assume that working in the project team meets the first two level of need in Maslow‟s hierarchy – physiological and safety/security needs. By his or her own actions, the project manager can address needs for i. Social interaction – everyone part of the team. No one is left out ii. Status and recognition – people are rewarded for their achievements, even if it is a simple public „thank you‟ iii. Achievement and challenging job – team members are pushed to develop and achieve greater and greater things  Herzberg found that the things that motivated people were: achievement, recognition, the kind of work people were given, their responsibility and advancement. There is opportunity to structure the work given to the team members to take advantage of the motivating forces in us all.  Attempts to explain relational satisfaction in terms of perceptions of fair/unfair distributions of resources within interpersonal relationships An individual will consider that he is treated fairly if he perceives the ratio of his inputs to his outcomes to be equivalent to those around him. Thus, all else being equal, it would be acceptable for a more senior colleague to receive higher compensation, since the value of his experience (an input) is higher. This can be illustrated by the following equation Inputs Inputs are defined as: each participant‟s contributions to the relational exchange and are viewed as entitling him/her to rewards or costs. The entitlement to rewards/costs described to each input vary depending on the relational setting. In industrial settings, assets such as capital and manual labour are seen as "relevant inputs" – inputs that legitimately entitle the contributor to rewards. In social settings, assets such as physical beauty and kindness are generally seen as assets entitling the possessor to social rewards.  Time Adaptability Effort Flexibility Loyalty Tolerance Hard Work Determination Commitment Enthusiasm Ability Personal sacrifice  Love Reputation Intimacy Responsibility Security Sense of achievement Salary Praise Employee benefit Thanks Recognition  Expectancy theory is about choice. Expectancy theory predicts that employees in an organization will be motivated when they believe that: effort performance rewards putting in more effort will yield better job performance better job performance will lead to organizational rewards, such as an increase in salary or benefits 1. Valance (V)- strength of an individual‟s preference for a particular outcome. The valance to be positive, 2. Instrumentality (I) – This factor is the instrumentality of the first level outcome in obtaining the desired second level outcome. It is the degree to which a first level outcome will lead to the second level outcome. 3. Expectancy (E) - It is the probability or strength of belief that a particular action will lead to a particular first level outcome. Vroom says the sum of these variables is the motivation.  General Nature of the Technical Professional Having a high need for achievement Desiring autonomy Identify first with their profession then their company Seeking to maintain their expertise  Coach for peak performance Run organizational interference Orchestrate professional development Expand individual productivity through teamwork Facilitate self-management  Explain the difference between leader and manager? Describe the nature of leadership and its significance to an organization? Discuss different views of motivation? That‟s all for today….thank you  SWOT Analysis Examples Example 1 - Starbucks SWOT Analysis. Strengths - Starbucks Corporation is a very profitable organisation, earning in excess of $600 million in 2004. Weaknesses - Starbucks has a reputation for new product development and creativity. Opportunities - New products and services that can be retailed in their cafes, such as Fair Trade products. Threats - Starbucks are exposed to rises in the cost of coffee and dairy products.  SWOT Analysis Examples Example 2 - Nike SWOT Analysis. Strengths - Nike is a very competitive organisation. Phil Knight (Founder and CEO) is often quoted as saying that 'Business is war without bullets. Weaknesses - The organisation does have a diversified range of sports products. Opportunities - Product development offers Nike many opportunities. Threats - Nike is exposed to the international nature of trade. SWOT Analysis Exercise SWOT Analysis Exercise Highly Brill Leisure Center has hired you to help them with their marketing decision making. Perform a SWOT analysis on Highly Brill Leisure Center, based upon the following issues: 1. The Center is located within a two-minute walk of the main bus station, and is a fifteen-minute ride away from the local railway station. 2. There is a competition standard swimming pool; although it has no wave machines or whirlpool equipment as do competing local facilities. 3. It is located next to one of the largest shopping centers in Britain. 4. It is one of the oldest centers in the area and needs some cosmetic attention. 5. Due to an increase in disposable income over the last six years, local residents have more money to spend on leisure activities. 6. There has been a substantial decrease in the birth rate over the last ten years. 7. In general people are living longer and there are more local residents aged over fifty-five now than ever before. 8. After a heated argument with the manager of a competing leisure center, the leader of a respected local scuba club is looking for a new venue. 9. The local authority is considering privatizing all local leisure centers by the year 2000. 10. Press releases have just been issued to confirm that Highly Brill Leisure Center is the first center in the area to be awarded quality assurance standard BS EN ISO 9002. 11. A private joke between staff states that if you want a day-off from work that you should order a curry from the Center's canteen, which has never made a profit. 12. The Center has been offered the latest sporting craze. 13. Highly Brill Leisure Center has received a grant to fit special ramps and changing rooms to accommodate the local disabled. 14. It is widely acknowledged that Highly Brill has the best-trained and most respected staff of all of the centres in the locality Answer Answer: As you can see the answer does not completely agree with yours. This does not mean that you are wrong. It simply means that the results of your analysis are represented in a different way. Points 2 and 10 are difficult to place. Point 2 depends on whether or not wave machines or a whirlpool have a distinct competitive advantage over a competition standard pool. Point 10 is an internal strength and an external opportunity. Strategic Planning There are essentially eight key areas for establishing objectives: Market share Innovation Productivity Physical and Financial Resources Manager Performance and Development Worker Performance and Attitude Profitability Social Responsibility  What Really Works Management by Objectives (MBO) Based on: goals participation Feedback Develop work assignments based on organizational needs and objectives. Plans are agreed between manager and subordinate. Objectives should be stretch objectives Needed resources should be determined and agreed to. Plans should include employee development as well. Plans are for a 6 month to 1 year time span. Planning Concepts Responsibility for Planning Planning Premises Planning Horizon System of Plans Policies and Procedures  Planning Timeframes Exhibit 4.4  Planning Roles of Engineering Managers Planning guidelines i. Assist their own superiors in planning ii. Ask for support from subordinates iii. Develop active plans - Time management - Projects and programs - Corporate know-how - Proactive tasks  i) Assist their own Superiors in Planning a. Analysing hard data (industry, competition and marketing) b. Offering alternative interpretation to data available c. Raising insightful questions to challenge conventional assumptions d. Communicating the resulting outputs of planning ii) Ask for Support from Subordinates To optimally benefit from the knowledge, expertise, and insights of staff  iii) Develop Active Plans Time management – plan and prioritise their personal daily tasks Projects and programs – understand project objectives, carefully select staff members with relevant skills and integrate all input to draft a project plan. Corporate know-how – documental knowledge (patents, etc), problem- solving expertise Proactive tasks – utilising new technologies, looking for business partners, offering new services to customers, develop new products. How to Make a Plan That Works  Setting Goals (Vision) Specific Clear and unambiguous goal Measurable Concrete criteria for measuring progress Attainable Goals that are realistic and attainable Realistic “Do-able” Timely Within a time frame SMART - Example Take for example the case of a manager who would like to see an improvement in the time taken and number of steps it takes to place an order on an ecommerce site. The manager might phrase the objective: Understand the purchase process Looking carefully at the above objective and you’ll notice some problems in the phrasing of the objective. SMART The problems that come to mind are: S: How will the manager know what to do? The verb understand is not really specific! M: How will the manager measure the progress towards achieving this objective? The objective does not have any measurable item. A: Is it an achievable objective? If it isn’t, then de-motivation creeps in. R: Is it a realistic objective? For example, if the manager does not have the skills or resources, the objective may not be achievable. In the example above, as there is no timeline associated, the objective is vague. Also, the manager may not have the supported resources. T: By when should the objective be met? Time-line is critical. Humans work towards goals based on some pressure applied by the time of completion. Hence, objectives should be time-bound. SMART The objective mentioned above can be rephrased to: Decrease the number of steps required to complete an order by 30% by the end of this quarter.  Goal (Vision) Commitment The determination to achieve a goal. Increased by: Setting goals participatively Making goals reasonable Making goals public Obtaining top management support  Developing an Effective Action Plan For accomplishing a goal an action plan lists: Specific steps People Resources Time period  Tracking Progress First method Set proximal (i.e., short-term) goals Set distal (i.e., long-term or primary) goals Second method Gather and provide feedback Make adjustments in effort, direction, and strategies  Maintaining Flexibility Options-based planning keep options open through simultaneous investment invest more in promising options Learning-based planning plans need to be continually tested, changed and improved encourages frequent reassessment and revision of goals  Setting Missions Targeting setting a clear, specific target Common-enemy mission vowing to defeat a corporate rival Role-model mission emulating a successful company (Benchmarking) Internal-transformation mission aiming to achieve dramatic change to remain competitive  Bending in the Middle Tactical Plans specify how a company will use resources, budgets, and people to accomplish goals Management by Objectives (MBO) develop and carry out tactical plans four steps discuss goals participatively select goals jointly develop tactical plans meet to review performance  Finishing at the Bottom Operational plans day-to-day plans Single-use plans deal with unique, one-time-only events Standing plans plans for recurring events three types Policies (guide for decision making) Procedures (sequence of activities to accomplish a desire purpose) Rules and regulations (do not permit discretion) Budgets Determine the basic units (man-hours, weeks) Estimate total resources  Special-Purpose Plans Planning for Change Planning for Dr Wan Azlan / Dr Nordiana Contingencies Planning for Product Development 26  Planning for Change Stretch goals extremely ambitious goals that you don’t know how to reach Benchmarking identifying outstanding practices, processes, and standards in other companies adapting them to your company  Planning for Contingencies: Scenario Planning Define the scope of the Using steps 1-4 create scenario initial scenarios Identify the major Check each scenario stakeholders for consistency Identify environmental Create contingency trends plans from each Identify key scenario uncertainties and Develop measures to outcomes indicate when scenario events are occurring  Planning for Product Development Aggregate product plans: used to manage and monitor all new products indicate resources being used for each product indicate product’s place in company’s plans help avoid having too many products in development That’s all for this chapter… Any Question?  CONTROLLING “Management is the profession of control ” Stafford Beer Learning Objectives To explain the concept of control in engineering management To discuss the controlling process and techniques To describe the means of control To differentiate various control parameters The Function of Engineering Management Planning Organizing Controlling Leading  Controlling Defined The process of monitoring activities to ensure they are being accomplished as planned and of correcting any significant deviations  Controlling Controlling is the measurement and correction of performance  in order to make sure that enterprise objectives and the plans devised to attain them are accomplished. Planning and Controlling are closely related.  Controlling as a Management Function Controlling A process of monitoring performance and taking action to ensure desired results. It sees to it that the right things happen, in the right ways, and at the right time. 6  Controlling as a Management Function Controlling Done well, it ensures that the overall directions of individuals and groups are consistent with short and long range plans. It helps ensure that objectives and accomplishments are consistent with one another throughout an organization. 7  Controlling as a Management Function Controlling It helps maintain compliance with essential organizational rules and policies. 8  Controlling Process Establish Performance standards Monitor actual performance Measure performance Correct deviations from standards  The Control Process Establish objectives and standards. Measure actual performance. Compare results with objectives and standards. Take necessary action. 10 Establish Objectives and Standards The control process begins with planning and the establishment of performance objectives. Performance objectives are defined and the standards for measuring them are set. 11 Establish Objectives and Standards There are two types of standards: Output Standards - measures performance results in terms of quantity, quality, cost, or time. Input Standards - measures work efforts that go into a performance task. 12  Measuring Actual Performance Measurements must be accurate enough to spot deviations or variances between what really occurs and what is most desired. Without measurement, effective control is not possible. 13  Comparing Results with Objectives and Standards The comparison of actual performance with desired performance establishes the need for action. Ways of making such comparisons include: Historical / Relative / Engineering Benchmarking 14 Taking Corrective Action Taking any action necessary to correct or improve things. Management-by-Exception focuses managerial attention on substantial differences between actual and desired performance. 15 Taking Corrective Action Management-by Exception can save the managers time, energy, and other resources, and concentrates efforts on areas showing the greatest need. There are two types of exceptions: Problems - below standard Opportunities - above standard 16 Controlling Techniques Budget Statistical Data Reports and Analysis Time Budgeting Program Procedural Planning & Control. Controlling Decisions Evaluates the performance of an organization and its units  to see whether the organization is progressing in the desired direction, and  taking corrective action when and where necessary. Making sure what you want to happen does indeed happen! Controlling Decisions (..contd.) THE QUALITY AND QUANTITY OF CONTROLLING DECISIONS DEPENDS A GREAT DEAL ON THE QUALITY OF PREVIOUSLY MADE PLANNING, ORGANIZING AND DIRECTING DECISIONS The better the planning, organizing and directing, the better will be controlling!  Effective Controls The Best Controls in Organizations are Strategic and results oriented Understandable Encourage self-control 20  Effective Controls The Best Controls in Organizations are Timely and exception oriented Positive in nature Fair and objective Flexible 21  Types of Control Preliminary Sometimes called the feedforward controls, they are accomplished before a work activity begins. They make sure that proper directions are set and that the right resources are available to accomplish them. 22  Types of Control Concurrent Focus on what happens during the work process. Sometimes called steering controls, they monitor ongoing operations and activities to make sure that things are being done correctly. 23  Types of Control Postaction Sometimes called feedback controls, they take place after an action is completed. They focus on end results, as opposed to inputs and activities. 24  Types of Controls Managers have two broad options with respect to control. They can rely on people to exercise self-control (internal) over their own behavior. Alternatively, managers can take direct action (external) to control the behavior of others. 25  Types of Control Internal Controls Allows motivated individuals to exercise self-control in fulfilling job expectations. The potential for self-control is enhanced when capable people have clear performance objectives and proper resource support. 26  Types of Control External Controls It occurs through personal supervision and the use of formal administrative systems.  Performance appraisal systems, compensation and benefit systems, employee discipline systems, and management-by-objectives. 27 Organizational Control Systems Management Processes  Strategy and objectives  Policies and procedures  Selection and training  Performance appraisal  Job design and work structures  Performance modeling, norms, and organization culture 28 Organizational Control Systems Compensation and Benefits  Attract talented people and retain them.  Motivate people to exert maximum effort in their work.  Recognize the value of their performance contributions. 29 Organizational Control Systems Employee Discipline  Discipline is defined as influencing behavior through reprimand.  Progressive Discipline ties reprimand to the severity and frequency of the employee’s infractions.  Positive Discipline tries to involve people more positively and directly in making decisions to improve their behavior. 30 The “Hot Stove Rule” To be Effective Discipline Should be: Immediate Informative Focus on Occur in a activity not supportive personality setting Consistent Support realistic rules 31 Organizational Control Systems Information and Financial  Activity-based costing - the true cost of all products and services.  Economic value added - examine the value added by all activities.  Understand the implication of key financial measures of (ratios) organizational performance 32 Operations Management and Control Purchasing Economic Order Quantity automatic reorder points Just-In-Time Scheduling 33 Operations Management and Control Project Management Program Evaluation and Review Technique (PERT) - Identifies and controls the many separate events in complex projects. 34 Operations Management and Control Statistical Quality Control Based on the establishment of upper and lower control limits, that can be graphically and statistically monitored to ensure that products meet standards. 35 Parameters to Control Control of Management Time Control of Personnel Control of Business Relationship Control of Projects Control of Quality Control of Knowledge 36 Parameters to Control 37  Control of Management Time Projects have a definite beginning and a definite ending date. Therefore, there is a need to manage the budgeted time according to a project schedule. Managing time/schedule is about definition, sequencing, resource and duration estimating, schedule development, and schedule control. 38  Control of Personnel Projects consist of teams and you need to manage project team(s) during the life cycle of the project. Finding the right people, managing their outputs, and keeping them on schedule is a big part of managing a project. Managing human resources is about human resources planning, hiring, and developing and managing a project team. 39  Control of Business Relationship Every project impacts people and organizations and is impacted by people and organizations. Identifying these stakeholders early, and as they arise and change throughout the project, is a key success factor. Managing stakeholders is about identifying stakeholders, their interest level, and their potential to influence the project; and managing and controlling the relationships and communications between stakeholders and the project. 40  Control of Projects Projects have all types of activities going on and there is a need to keep the “whole” thing moving collectively – integrating all of the dynamics that take place. Managing integration is about developing the project charter, scope statement, and plan to direct, manage, monitor, and control project change. Projects need to have a defined parameter or scope, and this must be broken down and managed through a work breakdown structure or work breakdown structure (WBS). Managing scope is about planning, definition, WBS creation, verification, and control. 41  Control of Projects Projects consume resources, and therefore, there is a need to manage the investment with the realization of creating value (i.e., the benefits derived exceed the amount spent). Managing costs is about resource planning, cost estimating, budgeting, and control. Projects procure the services of outside vendors and contractors, including the purchase of equipment. There is a need to manage how vendors are selected and managed within the project life cycle. Managing procurement is about acquisition and contracting plans, sellers’ responses and selections, contract administration, and contract closure. 42  Control of Quality Projects involve specific deliverables or work products. These deliverables need to meet project objectives and performance standards. Managing quality is about quality planning, quality assurance, and quality control. 43  Control of Knowledge Projects invariably touch lots of people, not just the end users (customers) who benefit directly from the project outcomes. This can include project participants, managers who oversee the project, and external stakeholders who have an interest in the success of the project. Managing communication is about communications planning, information distribution, performance reporting, and stakeholder management. 44  Control of Knowledge Projects are a discovery-driven process, often uncovering new customer needs and identifying critical issues not previously disclosed. Projects also encounter unexpected events, such as project team members resigning, budgeted resources suddenly changing, the organization becoming unstable, and newer technologies being introduced. There is a real need to properly identify various risks and manage these risks. Managing risk is about risk planning and identification, risk analysis (qualitative and quantitative), risk response (action) planning, and risk monitoring and control. 45  THANK YOU!!! ANY QUESTIONS? 46