Syllabus Course No.

ES70 Course Title: Engineering Management Course Description: The subject deals with the study of Engineering Management, as well as its basic principles. Likewise it deals with the different functions of an engineer manager. Management cases that try to highlight management issues are also part of the subject. Credit: 3 units Textbook: Engineering Management, 1st Ed. By Roberto Medina Objectives: 1. Let the students understand the nature and concept of Engineering Management as well as the function of an Engineer Manager. 2. Know how to apply management principles in various cases that they may then encounter in their future profession. 3. Develop a sense of professional and ethical responsibility. Course Center: 1. 2. 3. 4. 5. The field of Engineering Management Decision Making and Planning Organizing, Staffing and Communicating Motivating, Leading and Controlling Other related topics

Grading System: Major Exams: 60% Recitation/Assessment: 40% Passing Mark: 50%

Engineering management is the activity of combining technical knowledge with the ability to organize and coordinate worker power, materials, machinery and money. Management is a creative solving problem process of planning, organizing, leading (or directing) and controlling the organizations resources to achieve its mission and objectives. Requirements on engineer manager job: 1. 2. 3. 4. A bachelors degree in engineering in some cases masters degree in engineering or management is necessary, Experience in pure engineering jobs, Training in supervision, Special training in engineering management.

Conditions required for one to become a successful engineering manager: 1. Ability refers to the capacity of the person to achieve the organizations objective efficiently and effectively. a. Effectively refers to the description that deals whether objectives are accomplished. b. Efficiently refers to the description that deals how much of the resources were used to achieve effectiveness. 2. Motivation to manage willingness to manage and do management job. 3. Opportunity - There must be or finding a suitable managerial job. - Finding a favorable climate once on the job.

DECISION MAKING Is the process of identifying and choosing alternative courses of action in a manner appropriate to the demands of the situation Problem the difference between the desired situation and the actual or present situation/condition. Steps in Decision Making 1. 2. 3. 4. 5. 6. 7. 8. 9. Diagnose Problem Evaluate the Environment Articulate the problem/opportunity Develop viable alternatives Evaluate alternatives Make a choice Implement the design Evaluate the results Favorable Result/adopt the result OR Result is unfavorable of objective not obtained determine the error (back to step 4)

Engineering Firm of the Internal Environment 1. 2. 3. 4. 5. Organizational aspect Marketing aspect Personnel aspect Production aspect Financial aspect

External Environment Decision External Environment

Engineering Firm of the External Environment

Government

Engineer

Labor Union

Clients

Firm

Suppliers

Competitors

Banks

Public

Approaches in Solving Problem 1. Qualitative decision is based on subjective judgment and intuition 2. Quantitative requires rational and analytical thinking Quantitative Models/Techniques 1. Inventory Model a. Economic order quantity model involves determining the number of supplies that must be ordered once and eliminate the repetition orders for the same period of time. b. Production order quantity model principle of economic order quantity model is applied to production c. Back order inventory model same principle but applied to planned shortages d. Quantity discount model the order must be maximized to benefit from the discounts given to bulk orders. 2. Queuing Technique/Method a. Applicable for service companies/organizations b. Tries to minimize the customers waiting time and the cost of service 3. Network Models break down large and complex task into smaller and which may be managed easily. This utilizes PERT (Project Evaluation Review Technique) and CPM (Critical Path Method). Building Subdivision a. Preparation of the land for the construction b. Concreting the road c. Electrification d. Drainage system Forecasting Past and current information are utilized to make predictions about the future. Regression type of forecasting that analyzes the relationship of the variables/factors involved. Simulation a model is constructed is represent reality where conclusions about real life problems may be used. Linear Programming this is a technique of obtaining an optimum solutions within the bounds imposed by the constraints upon the decision. Sampling a number of population is statistically determined and used for different activities, like research, marketing, etc. Statistical Decision Theory a rational way to conceptualize analyze and solve problem with limited or partial information about the decision environment.

4. 5. 6. 7. 8. 9.

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

Levels of Management and Type of Planning Top Management Level CEO, President, V-President, General Managers, Division Heads Middle Management Level Functional Managers, Low Management Level First Line Supervisors, Unit Managers Strategic Planning (one year up to ten years) - The process of determining the major goals of the organizations and the strategies and policies to achieve these goals. Intermediate Planning (six months up to two years) - The process of determining the contributions the subunits can make with the allocated resources. Operational Planning (one week up to one year) - The process of determining how specific tasks can best be accomplished with the available resources.

Strategy A course of action aimed at assuring that the organization will achieve its objectives. Tactic A short course of action taken by management to adjust to the negative internal or external influences. The Organization and the Types of Planning

President/ General Manager

Top Management Level

Strategic Planning

Marketing Manager

Production Manager

Finance Manager

Personnel Manager

Intermediate Planning

Middle Management Level

Industrial Engineering Manager

Factory Manager

Quality Control Manager

Operational Planning Low Management Level

The Planning Process 1. Setting Organizational, Divisional or Unit Goal Level of Management Type of Goal Company 25% return in investment Division Increase number of projects Unit Increase number of project engineers 2. Determining the strategy or tactic. 3. Determining the Resources needed. 4. Setting standard the quantitative or qualitative measuring device designed to help monitor the performance of capital goods, people or processes. Types of Plan 1. Functional Area Plans the focus is on the function involved. a. Production Plan b. Marketing Plan c. Financial Plan d. Human Resources Development Plan 2. Plans with Time Horizon a. Short-range plan (less than one year) b. Long-range plan (more than one year) 3. Plans According to Frequency of Use a. Standing Plan policies, procedures, rules b. Single Use Plan progress, projects, budget Types of Plan Plan with Time Horizon Plan According to Frequency of Use Short-range Plan Standing Plan Single Use Plan Long-range Plan Policy Progress Procedure Projects Rule Budget

Functional Area Plan Production Plan Marketing Plan Financial Plan

December 19, 2013 Parts of Strategic Plan 1. Company or Corporate Mission o A strategic statement that defines why an organization exists, its philosophy of management and its purpose as distinguished from other similar organization in terms of products, services and markets. 2. Goals or Objectives o Things the company desires to achieve. o Precise statements of desired results. 3. Strategies

ORGANIZING A management function that refers to structuring of activities and resources to accomplish objectives efficiently and effectively.

Structure The product of organizing process. The arrangement or relationship of positions in an organization.

Purposes of Structure 1. It defines the groupings of individuals and departments into an organization. 2. It defines the formal reporting relationship, the number of levels (1st, 2nd, 3rd, etc.) of the hierarchy of the organization and span of control. 3. It defines the relationship between authorities and tasks for individuals and departments. 4. It defines the system to effect coordination of efforts between the horizontal (task) and vertical (authorities) direction. Division of Labor Determination of the scope of work and how it is combined in a job.

Departmentation Groupings of related jobs, activities and processes into major organization subunits.

Delegation of Authority Assignment of various degrees of decision making authority to subordinates.

Span of Control Refers to the number of people reporting directly to a given manager.

FORMAL ORGANIZATION It planned structure and it represents a deliberate attempt to establish patterned relationship among components that will tend to achieve the organizations objectives effectively.

Organizational Chart It tries to describe or give information about the official positions and the formal lines of authority.

Informal Groups These are formed spontaneously because of friendship, common interest, etc. o Friendship o Common Interest o Proximity o Need of Satisfaction o Collective Power o Group Goals (consumer society, gym enthusiasts, sports, etc.)

Friendship Common Interest Proximity Need of Satisfaction Collective Power Group Goals (consumer society, gym enthusiasts, sports, etc.)

Form Informal Groups Join in

Types of Organization According to Structure 1. Functional Organization it is a form of departmentation, in which persons engage in same functional activities like engineering or marketing, are grouped into one.

President

Vice President for Finance

Vice President for Construction

Vice President for Marketing

Vice President for Human Resources

2. Project or Market Organization it is organizing a company by division that brings together all those involved in the same product or market.
Finance

Vice President for Government Accounts

Marketing Construction Human Resources

Finance

President

Vice President for Industrial Accounts

Marketing
Construction Human Resources Finance

Vice President for Residential Accounts

Marketing Construction Human Resources

3. Matrix Organization is a form of structure, wherein an employee reports both directly to a functional or division manager and to a project or group manager.
Project X Manager

Project Manager

Project Y Manager

Project Z Manager

Engr. X

Construction Manager

Engr. Y

President

Vice-President for Finance Engr. Z Vice President for Construction Purchasing Specialist Vice President for Human Resources Purchasing Manager Purchasing Specialist

Purchasing Specialist

Contract Negotiator Contract Administration Manager

Contract Negotiator

Contract Negotiator

Committee(s) Formal group of employees for a specific or particular purpose.

Types: 1. Ad Hoc Committee it is a short term period committee for a limited life, e.g. Committee in charge of anniversary festival. 2. Standing Committee a committee for on-going issues or reoccurring conditions, e.g. grievance committee that handles disputes among the members/employees themselves.

Types of Authority: 1. Line Authority the right of the manager to tell him/her subordinates what to do and see that they did it. 2. Staff Authority staff specialists right to give advice to the manager. 3. Functional Authority the right of the employee to oversee lower level employees involve in the same specialty, regardless where that employee is located in the organization.

STAFFING A management function that determines the human resource needs, recruits, selects, trains, and develops human resources for the job created by an organization. Is a procedure that involves the following steps 1. Human resource planning which involves: a. Forecasting determination of the possible required or expected b. Programming c. Evaluation and Control determining whether the activities conducted are in accordance with the desired standard 2. Recruitment the attracting of qualified applicants to apply for the vacant positions in the company so that those best suited serve the company may be selected. Sources of Applicants/Ways of Attracting or Hiring Applicants a. Newspaper b. Internet c. School d. Referrals e. Recruitment Firms/Agencies f. Current Employees of the Company Internal Recruitment 3. Selection the act of choosing the best suited for the job. There are several tests conducted: a. Physical Examination b. Psychological Tests i. Aptitude Test determination of persons capability or potentials ii. Personality Test iii. Performance Test iv. Interest Test Ways of determining the qualifications of the applicants: a. Application Blanks b. Interviews question and answer part c. Referrals d. Tests 4. Induction and Orientation

5.

6.

7. 8.

a. Induction the newly hired employees are informed about the company (necessary and relevant information like history, product, etc.) In addition, said employees are also informed about duties and responsibilities, and their benefits. b. Orientation the newly hired employees are introduced to their co-workers and working environments. They are also informed of the policies, procedures, roles, etc. Training and Development a. Training Learning designed to improve the present performance on the job. i. Training for non-managers 1. On-the-job Training 2. Vestibule School simulated situation similar to actual working condition/workplace 3. Apprenticeship other than the actual wherein there is a failure, there is a supplemental classroom learning/instruction 4. Special Courses enrolled in courses/additional learning at the expense of the company ii. Training for managers 1. To improve decision-making skills a. In-basket trainee is provided with a lot of messages, notes, telephone calls, etc. about a particular situation and he must handle it for 1 or 2 hours. b. Management games act as a manager and try to transact in a similar situation c. Case studies study how the manager reacted to the situation, handle a situation 2. Interpersonal relationship skill, dealing with people a. Role-modeling/playing workshop, assigned with roles b. Behavior-modeling c. Sensitivity training trying to be aware, be sensitive to behavioral patterns d. Transactional analysis 3. Job-knowledge a. On-the-job experience b. Coaching c. Understudy 4. Organizational knowledge a. Position Rotation b. Multiple Management Performance Appraisal evaluation the performance of the employees for: a. Monetary reward b. Promotion giving the employee a higher position, benefits, salary, and duties and responsibilities c. Transfer change department, similar level position and responsibilities (consult lawyer if unreasonable, transfer must be justified) d. Demotion lowering the position which corresponds to a lower salary and lower responsibilities Employment Decision the result of the performance appraisal which may be a monetary reward, promotion, transfer and demotion. Separation a. Voluntary initiative comes from the employee, employee resigns b. Involuntary the manager/company terminates the employee

COMMUNICATION Is a process of sharing information through symbols, including words and messages.

Purposes of Communication: 1. Motivation Function motivate employees, used to encourage 2. Information Function a manager needs to tell his employees, or inform the manager, subordinates, superiors, co-equal employees, clients, etc. 3. Control Function policies, procedures, rules, regulations are followed, control subordinates, etc. 4. Emotive Function utilized to reduce the internal effect/pressure on the part of employees, anxiety, problems, undesirable feelings; the manager needs to connect and emphatic etc. The Communication Process

SENDER

Encode
transmit the message

RECEIVER
the one who receives the message

Feedback

Decode
unfold the message

Accept/Reject

Forms of Communication 1. Verbal communication through hearing or sight. a. Oral b. Written 2. Non-verbal communication through body language, time, space, appearance, aesthetic quality, clothing, etc. Barriers to Communication 1. Personal Barrier refers to communicators personal characteristics that prevent the effective and efficient conveying of information, example poor hearing. 2. Physical Barrier interferences brought by environment where communication is made. 3. Semantic Barrier interferences resulting from misunderstanding of the symbol/message, although the same way received as it transmitted.

Overcoming Barriers to Communication 1. 2. 3. 4. Repeat the message Use simplified language Use multiple channel of communication Ask for feedback

Techniques of Communicating for an Organization 1. Upward Communications a communication from a lower level of authority or position to higher authority, e. g. complaints, report performances, suggestions box, etc. 2. Downward Communications from upper position to lower position, e. g. instructions, feedbacks, encourage, persuade, inform about activities, newsletter, etc. 3. Parallel Communications same-level positions, e. g. manager to manager, co-worker to co-worker Management Information System (MIS) Organized system of providing past, present and projected information about the internal operations and external intelligence for use in making decision

Marketing

Finance

MIS
Production

Human Resources

MOTIVATING It is the act of giving incentives or reasons to the employees to work to achieve organizational objectives. Motivation is the process of activating behavior, sustaining and directing it towards a particular goal. Factors Affecting Motivation 1. Willingness to do the job 2. Self-confidence to do the task 3. Need satisfaction (Will he exert additional effort to obtain additional sales for example, will it satisfy the employees needs? i.e. Does he need the extra money?) Theories of Motivation 1. Maslows Need Hierarchy Theory a. There are five basic needs: physiological needs, security needs, social needs, self-esteem needs, and self-fulfillment needs. These needs are hierarchical which means the first basic needs must be satisfied first before the other needs. b. Not universally accepted as entirely correct but it recognizes the fact that a person with satisfied need will not be motivated by providing him/her the same needs.

Selfactualization

or Self-fulfillment Needs

Esteem Needs

Prestige, status, respect Friendship, belonging, love Freedom from harm, financial security Food, shelter, water, sex, body elimination

Social Needs
Security Needs Physiological Needs

2. Herzberg or Two-factor Theory - There are two factor that must be considered: a. Satisfiers or motivation factors i. Recognition, advancement, growth, ii. Responsibility, work itself iii. For the manager to motivate the employees, he/she should focus on providing the employees with satisfiers or motivation factors. b. Dis-satisfiers or hygiene factor i. Company policy and administration, work conditions relationship with peers, salary, relationship with subordinates security, relationship with superiors, status, personal life ii. Elimination of dis-satisfiers does not motivate the employees but eliminate or lessen dissatisfaction on the part of the employees.

3. Expectancy Theory the employees motivation to work depend upon his/her perception of his/her expectation of the probability that his/her needs will be satisfied. 4. Goal-Setting Theory the performances of employees are improved by setting objectives, deadlines or quality standards. TECHNIQUES OF MOTIVATION 1. Motivation Through Job-Design specifying the tasks that constitute a job for an individual or a group. Approaches: a. Fitting people to jobs i. Realistic job previews ii. Job rotation iii. Limited Exposure b. Fitting jobs to people i. Job enlargement ii. Job enrichment 2. Motivation Through Rewards a. Extrinsic Rewards i. Monetary benefits ii. Recognitions b. Intrinsic Rewards i. Internal experience payoffs which are self-granted. This does not come from other person but which the individual himself feels. 3. Motivation Through Employee Participation a. Quality control circles b. Self-manage teams 4. Other Techniques of Motivation a. Flexible Work Schedule b. Family Support Services c. Sabbatical Leave

CONTROLLING The process of ascertaining whether the organizational objectives have been accomplished, if not, why not, and determining the activities that may be taken to achieve objectives better in the future.

Steps in the Control Process 1. 2. 3. 4. Setting the Performance Standards and Objectives Measure the actual performance Comparing actual performance with the set standard and objective Taking the necessary measures as a result of the comparison

Types of Control 1. Feed Forward Control the problem in anticipated and advance solutions is provided to avoid the happening of the problem. 2. Concurrent Control the operation is already on-going, measures are adopted to check if there are any problems and if any, solutions are adopted or introduced. 3. Feedback Control the activity or operation is finished already and it is analyzed to check the problems encountered and then solutions are crafted for the next activity/operation. LEADING A management function that involves influencing others to engage in a work behavior necessary to reach organizational objectives/goals.

The leader must have power to influence Classification of Power a. Legitimate Power authority derived from the position sanctioned by or in accordance with law (e.g. elected) b. Reward Power authority to give rewards or power to suspend/punish or impose sanctions to employees. c. Coercive Power forceful orders (e.g. policeman, traffic enforcers), power to impose commands, or compel. d. Referent Power power by a person who is identified to be associated with another person, in which, the former person is supposedly having powers. e. Expert Power power derived from a specialized knowledge over a particular subject, where the members follow the person with expertise. Leadership the process of influencing and supporting others to work enthusiastically toward achieving a classified goal. Traits of an Effective Leader 1. 2. 3. 4. 5. 6. 7. 8. A high personal drive The desire to lead Personal integrity Self-confidence Analytical ability or judgment Knowledge of company, industry or process Charisma (personal magnetism one possess to influence another person) Creativity (ability to combine data, experience, preconditions from various sources in such a way that the result is useful, regarded as new, and a solution to a problem; try to improve) 9. Flexibility Leadership Skills 1. Technical Skills 2. Human Skills 3. Conceptual Skills

Conceptual Skills The ability to think in abstract terms, to see how parts fit together to form the whole.

Behavioral Approaches to Leadership Styles

Positive leadership (emphasis on rewards)
According to the way the leader motivates the people

Behavioral Approaches

Negative leadership (emphasis on imposing sanctions, scaring, punishment)

Autocratic leadership (absolute rule, e.g. military, effective on emergency situations)

According to the way the leader uses his power

Participative leadership

Free-rein (requires result only, freedom how to accomplish that result, best for highly intellectuals)

Employee/people oriented According to the leader's orientation toward task and people Task oriented

Contingency Approaches to Leadership Styles 1. Fiedlers Contingency Model situation is considered, then leader is defined how to treat the situation. According to this style, leadership style is effective if the leader fits the situation. The primary factors that define the situation:

a. Relationship between the leader and the subordinates b. Structure of the tasks c. Power the leader has If the leader does not fit the situation: i. ii. iii. iv. The traits of the leader must be changed to fit the situation Change the leader with another that fit the situation Leader may be moved or rotated within the organization Change the situation

2. Hersey and Blanchers Situational Model the leadership style could be defined according to the maturity level/development level of the subordinates. a. Directing subordinates lacks the competence but they are enthusiastic and committed. They must be directed. b. Coaching subordinates have the competence but they are not committed. c. Supporting subordinates have the competence but they dont have the self-confidence and not motivated. They need to be raised and monitored. d. Delegating with capacity, competence and commitment. 3. Path Goal Model of Leadership 4. Vroons Model