Engineering Management Lec 4-5

types of quantitative techniques

1. Inventory models 2. Queuing Theory 3. Network Models 4. Forecasting 5. Regression Analysis 6. Simulation 7. Linear Programming 8. Sampling Theory

² Paper and gunpowder

100-1600AD

² Spinning and weaving machinery

1601-1799AD

² Steam engine

1601-1799AD

² Pyramid of Egypt

3000-600BC

² Stone bladed axe

6000-3000BC

² Roadbuilding by Romans

600BC-400AD

Strategies

A course of action aimed at ensuring that the organization will achieve its objective.

Queuing Theory

A model is constructed so that queue lengths and waiting times can be predicted.

Standards

A quantitative or qualitative measuring device designed to help monitor the performances of people, processes or capital goods

Mission statement

A statement of the firm's overall purpose.

EVALUATE ALTERNATIVES

After determining the viability of the alternatives and a revised list has been made. This is important because the next step involves making a choice.

Identifying Alternatives

All of these courses should be identified

Rational decision-making step 2

Analyze environment

Rational decision-making step 3

Articulate problem or opportunity

REQUIREMENTS FOR THE ENGINEER MANAGER'S JOB

Bachelor's degree in Engineering from a reputable school few years of experience in a pure engineering job master's degree in engineering or business management Training in supervision Special training in engineering management

Tactics

Concern of middle and lower management Is a short - term action taken by management

STRATEGIC PLAN

Corporate scope and mission statement

Strategies

DONE BY Senior Management, Community leaders

HUMAN RESOURCES PLAN

Determine recruiting strategy.

FINANCIAL PLAN

Determine the amount of capital that will be needed to support the plan

procedure in developing alternatives 2

Determine the viability of each solutions

Rational decision-making step 4

Develop viable alternatives

Rational decision-making step 1

Diagnose problem

² Management

Engineers are assigned to manage people in performing specific tasks.

² Teaching

Engineers are employed in schools to teach engineering.

² Research

Engineers are engaged in process of learning about nature and codifying this knowledge in usable theories

² Sales

Engineers assists company's customers to meet their needs

² Design and Development

Engineers turn concept into physical item

Rational decision-making step 5

Evaluate alternatives

Rational decision-making step 8

Evaluate and adapt decision results

Use of aids to planning

Gather as much information as possible

Determining sources needed

If strategies or tactics have been devised, the engineer manager will determine the human and nonhuman resource requirements.

DIAGNOSE PROBLEM

If the manager fails in this aspect, it is almost impossible to succeed in the subsequent steps.

Rational decision-making step 7

Implement decision

SWOT Analysis

It is a brief list of the critical success factors in the market, and rates strengths and weaknesses against the competition.

REVIEW YOUR VISION, MISSION, AND OBJECTIVES

It is helpful to review your mission, vision, and objectives to ensure that your strategies are all aligned with the goals expressed in your previous work.

EVALUATE AND ADAPT DECISION RESULTS

It is, therefore, important for the manager to use control and feedback mechanisms to ensure results and to provide information for future decisions.

Establish Dependencies

Listing the immediate predecessors of each activity will help you identify the correct order.

How One May Become a Successful Engineer Manager

MANAGERIAL ABILITY, MOTIVATION TO MANAGE, OPPORTUNITY

Rational decision-making step 6

Make a choice

Recognize the planning barriers

Manager's inability to plan Improper planning process Lack of commitment to the planning process Improper information Focusing on the present at the expense of the future Too much reliance on the planning department Concentrating only on the controllable variables

MOTIVATION TO MANAGE

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

Selecting the Alternative

Now the best and most feasible plan will be chosen to be implemented

OPPORTUNITY

Obtaining a suitable managerial job Finding a supportive climate once on the job

Corporate Strategies

Once a firm has defined its purpose, scope, and objectives, it must develop a strategy for achieving its goals.

Draw the Network Diagram

Once you have identified the activities and their dependencies, you can draw the critical path analysis chart (CPA)

Cole and Hamilton

Planning is deciding what will be done, who will do it, where, when and how it will be done, and the standards to which it will be done

Aldag and Stearns

Planning is the selection and sequential ordering of tasks required to achieve an organizational goal.

Nickels

Planning refers to the management function that involves anticipating future trends and determining the best strategies and tactics to achieve organizational objectives

Examining Alternate Course of Action

Plans are evaluated in the light of the organizational objectives.

procedure in developing alternatives 1

Prepare a list of alternative solutions.

² Testing

Products are tested for workability

Setting organizational, divisional, or unit goals

Provide a sense of direction to his firm, to his division, or to his unit

David H. Holt

Rational decision-making is a process involving steps

MAKING PLANNING EFFECTIVE

Recognize the planning barriers Use of aids to planning

² Government

Regulating, Monitoring and Controlling of various institutions

² Manufacturing

Responsible for mass production

² Construction

Responsible for quality construction process

procedure in developing alternatives 3

Revise the list by striking out those which are not viable

Characteristics of Goals

SPECIFIC MEASURABLE AGREED REALISTIC TIME-BASED

THE PLANNING PROCESS by Medina

Setting organizational, divisional, or unit goals Developing strategies or tactics to reach those goals Determining sources needed Setting standards

MARKETING PLAN

Situational Analysis and Target Market

Budget Schedule

The budget is the basis for materials buying, production scheduling, personnel planning and marketing operations.

Marketing Tactics

The manager should also outline specific strategies for such marketing mix elements in each target market: new products, field sales, advertising, sales promotion, prices and distribution.

Objectives and Strategy

The objectives are goals that the company would like to attain during the plan's term.

PRODUCTION PLAN

The plan explains who is responsible for each particular function, when specific tasks are to be accomplished, targets for sales and profits, and the like.

operational planning

The process of determining how specific tasks can best be accomplished on time with available resources.

intermediate planning

The process of determining the contributions that subunits can make with allocated resources.

Strategic Planning

The process of determining the major goals of the organization and the policies and strategies for obtaining and using resources to achieve those goals. The whole company is considered, specifically its objectives and current resources.

Forecasting

There are instances when engineer managers make decisions that will have implications in the future

Network Models

These are models where large complex tasks are broken into smaller segments that can be managed independently

DEVELOP VIABLE ALTERNATIVES

This is made possible by using a procedure

IMPLEMENT DECISION

This is necessary, or decisionmaking will be an exercise in futility.

MAKE A CHOICE

This is the point where he must be convinced that all the previous steps were correctly undertaken.

Statement of Corporate Objectives

This statement sets forth specific goals or targets to help operating managers focus on the firm's primary objectives. Most organizations have both quantitative and qualitative objectives.

Aldag and Stearns

Those who will be involved in implementation must understand and accept the solution.

ORGANIZE A BRAINSTORMING MEETING

To help meet these goals, you might post some "ground rules"

NATURE OF PLANNING

To minimize mistakes in decision-making, planning is undertaken

David Consunji

UP civil engineering graduate fifth richest billionaire in the Philippines construction with DMCI

Estimate Activity Completion Time

Using past experience or the knowledge of an experienced team member

Specify Each Activity

Using the work breakdown structure, you need to identify each activity (or task) involved in the project

simple regression

When one independent variable is involved

² Consulting

Works as consultant of any organization that needs his services

Identify the critical path

You can eyeball your network diagram and simply identify the longest path throughout the network

REVIEW (IDENTIFY) THE TARGETS

Your targets of change include all of the people who experience (or are at risk for) this issue or problem addressed by your initiative.

Regression Analysis

a forecasting method that examines the associations between two or more variables

The Program Evaluation Review Technique (PERT)

a technique which enables engineer manager to schedule, monitor, and control large and complex projects by employing three time estimates for each activity

Control

actions made to ensure that activities performed match the desired activities or goals that have been set

Simulation

allows you to evaluate, compare and optimize alternative designs, plans and policies

QUALITATIVE EVALUATION

based primarily on the managers' judgment and experience; it includes managers' conceptual and interpersonal ability to understand that behavioral techniques help to solve problems

work breakdown structure

breaks down projects into manageable sections. You can choose how to display your work breakdown structure

MANAGERIAL ABILITY

capacity of an engineer manager to achieve organizational objectives effectively and efficiently

Implementation

carrying out the decision so that the objectives sought will be achieved

Geronimo Z. Velasco

chairman of Republic Glass Holdings Corp energy minister from 1978 to 1986, implementing President Marcos's then strategic goal of reducing Philippine dependence on imported oil

Inventory models

consists of several types all designed to help the engineer manager make decisions regarding inventory

Planning

defined as selecting the best course of action so that the desired result may be achieved. The desired result takes first priority and the course of action chosen is the means to realize the goal.

Burns & Groove

defined quantitative research as "a formal, objective, systematic process in which numerical data are used to obtain information about the world

Corporate scope

defines its line or lines of business and its geographic area of operations.

Economic Production order Quantity model

determines the quantity a company or retailer should order to minimize the total inventory costs by balancing the inventory holding cost and average fixed ordering cost

Economic order quantity model

determining the optimal order size that minimizes the sum of carrying costs and ordering costs

John B. Miner

developed a psychometric test for measuring what he calls motivation to manage

Linear programming

developed as a mathematical pattern during World War II

Souder

each alternative must be analyzed and evaluated in terms of its value, cost, and risk characteristics

Developing strategies or tactics to reach those goals

goals, strategies and tactics

EXECUTIVE SUMMARY

helps top management to find the plan's central points quickly and presents an overall view of the marketing project and potential

objective of environmental analysis

identification of constraints; either internal or external limitations

Middle management level

intermediate planning

Components of the Environment

internal and external

QUANTITATIVE EVALUATION

justified by the mass character of analyzed occurrences, the need for repetitiveness of scientific experiments or extracting an appropriately numerous research sample in order to assure representativeness

Stevenson

managers tend to use the qualitative approach value when the problem is fairly simple; the problem is familiar; the cost involved is not great; immediate decisions are needed.

Marketing strategy

marketing logic by which the business unit hopes to achieve its marketing objectives

Geronimo Z. Velasco

mechanical engineer 1977 Management Man of the Year Award first president of Philippine National Oil Company (PNOC)

Ramon S. Ang

mechanical engineering graduate of Far Eastern University the dynamic boss who is transforming San Miguel Corporation

Henry Lim Bon Liong

mechanical engineering graduate of UP leader in Philippine paper products with Sterling Paper Group

² Car and household appliance

modern era

Management

must strive to choose a decision option as correctly as possible

Lower management level

operational planning

internal

organizational activities within a firm that surrounds decision-making

Webber

particular effort should be made to identify all significant consequences of each choice

Choice-making

process of selecting among alternatives representing potential solutions to a problem

Feedback

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

APPROACHES IN SOLVING PROBLEMS

qualitative evaluation and quantitative eveluation

Linear Programming

quantitative technique that is used to produce an optimum solution within the bounds imposed by constraints upon the decision

Sampling Theory

quantitative technique where samples of populations are statistically determined to be used for number of processes, such as quality control and, marketing research

Barkin

stated that "the term qualitative evokes a narrative or analytical richness, a method that brings out more detail and distinction from a case than can be found by reducing it to quantitative measures"

Top Management level

strategic planning

Lucio C. Tan

studied chemical engineering at Far Eastern University as a working student Lucio Tan's LT Group has interests in tobacco, spirits, banking and property development

Ferrell and Hirt

suggested that further analysis is necessary if it was not achieved

The Critical Path Method (CPM)

this is a network technique using only one time factor per activity that enables engineer managers to schedule, monitor, and control large and complex projects

Stevenson

types of quantitative techniques

Back order inventory model

used for planned shortages

Quantity discount model

used to minimize the total cost when quantity discounts are offered by suppliers

external

variables that are outside the organization and not typically within the short-run control of top management'

Problem

when there is a difference between an actual situation and a desired situations for instance

multiple regressions

when two or more independent variables are involved

ANALYZE THE ENVIRONMENT

where the organization is situated plays a very significant role in the success or failure of such an organization

Delaney

"should be removed from their position as soon as possible."'

Forecasting

"the collection of past and current information to make predictions about the future."

Decision-making

"the process of identifying and choosing alternative courses of action in a manner appropriate to the demands of the situation."