Professional Documents
Culture Documents
Dr. C. M. Chang
Only to be used by instructors who adopt the text:
C. M. Chang, Engineering Management: Challenges in
the New Millennium, Pearson Prentice Hall (2005)
Copyright 2005 by Dr. Carl Chang
Engineering Management
Functions
Organizing
Planning
Leading
Controlling
2
Engineering Management
Functions
Planning (forecasting, setting objectives, action
planning, administering policies, establishing
procedures)
Organizing (organizing workplace, selecting structure,
delegating, establishing working relationship)
Leading (deciding, communicating, motivating,
selecting/developing people)
Controlling (setting performance standards,
evaluating/documenting/correcting performance)
3
Chapter 3 -Contents
Introduction
Activities of organizing: (1) workplace, (2)
structure, (3) delegate work, and (4) establish
working relationship
Examples of organizing for performance
Informal organizations
Cross-functional teams
Conclusions
4
Organizing
Arrange and relate the work, so that it can be
done efficiently by people - Specifically:
Ensure that important work is done, Provide
continuity
Form basis for
salary administration
Aid delegation
Promote growth and
diversification Encourage teamwork, and
Stimulate creativity
5
Definitions
Organization Type - Line versus Staff
Authority - Power to command, act or
make decisions (Legal, position-based)
Responsibility - Duty to perform work
efficiently and in professional manner
Accountability - Upwards directed
obligation for securing the desired results
6
Engineering
R&D
Production
Marketing
Safety &
Environment
Procurement
Legal
Public Relations
Service
Distribution
Customers
Accounting
Human Resources
7
Definitions (contd)
Span of control - Number of people
supervised by a manager (e.g., 7 to 20)
Specialization - Increased degree of skills
concentration in narrow technical domains
Developing Structure
Delegating Work
Establishing Relationship
Question # 3.10
David Pope
Administrative
assistant
George Wallace
Glen Sanford
Personnel director
Presidents meeting
Own child has flu
11
Develop Organizational
Structures
Identify and group work so that it can be
done efficiently by people
Choices: (1) functional, (2) discipline, (3)
product/regional, (4) matrix, (5) team,
(6) network
12
Functional Organization
Technical Director
Mechanical Design
Electrical Design
System Engineering
Quality Control
Production Engineering
13
Functional Organizations
(Pros and Cons)
Permits hierarchy of
skills
Facilitates
specialization
Simplifies coordination
Permits use of current
technologies and
equipment
Encourages excessive
centralization
Delays decision making
Compounds
communication line loss
Restricts development
of managerial skills
Limits personal growth
14
Functional Organizations
(When to Use)
Organizations with high relative stability of
work flow and limited product diversity certain manufacturing operations, process
industries
Startup companies
Organizations with narrow product ranges,
simple marketing pattern and few production
sites
15
Discipline-Based Organization
Engineering Dean
Mechanical Engineering
Electrical Engineering
Chemical Engineering
Industrial Engineering
Civil Engineering
16
Discipline Organizations
Favored by universities, governmental
laboratories and other R&D organizations
Promote innovative pursuits in individual
disciplines, allowing employees to drill
down to deeper knowledge levels without
requiring much coordination with others.
17
Product Organization
Technical Director
Governmental Products
University Products
Consumer Products
Custom Products
Industrial Products
18
Regional Organization
President
North America
Latin America
Europe
Asia
Africa
19
Product/Regional Organization
(Pros and Cons)
Focuses on end products
or geographical regions
Facilitates coordination
Encourages management
development
Provides for
decentralization
Promotes growth
Matrix Organization
Functional Control
Project A
Project-based
Control
Project B
Project C
Engineering
Production
Logistics
Design
21
Matrix Organization
(Pros and Cons)
Project manager focus
on schedule and cost,
functional managers on
quality/expertise
Work load balance
Excellent for individuals
(to achieve exposure
and interactions)
Dual reporting
Severe conflicts among
managers
Delicate balance of
power (people versus
money/time)
Communications
problems
22
Matrix Organization
(Bases for Conflicts)
Project Managers:
Money under control,
mandate to authorize
work with top
management support
Rights to buy services
elsewhere
Functional Manager:
Manpower, skills
knowledge, facilities
Own funds to support
people
23
Team Organization
Functional Control
Team Leader
Member A
Member B
Member C
Member D
Engineering
Production
Logistics
Design
24
Team Organization
Team members on loan from functional
organizations to eliminate organizational
conflicts
Team Leader in full control
Short term high-priority tasks/projects
Examples: Product team, special task force
Purposes: (1) create recommendation, (2) make
or do things, and (3) run things
25
Network Organization
26
Network Organization
Global business alliances/partnerships to
manufacture, market, deliver and service
products (supply chains)
Change alliance members from time to time
Diversified alliance members (e.g., company
allegiance, culture, value system, business
practices, geography, attitude, motivation,
information sharing and collaboration, etc.)
27
Question # 3.1
Which type of organizational structure is
best suited for developing a new product
which requires a high level of specialization
in several functions and the time to market
represents a critical factor?
28
Question # 3.2
A materials manager suspects that the
quality of work being done within his
department was steadily deteriorating. He
wanted to introduce a program of change to
improve quality. What steps should he
take?
29
Examples of Performance
Enhancement by Organizing
(1) Keep Structure
flexible
(2) Promoting Innovation
(3) Design-Manufacturing
Interface
(4) Heightened Employee
Motivation
(5) High-tech Marketing
Interface
30
"A
33
(3) Design-Manufacturing
Interface
Difficulty created by a lack of coordination
Design is thrown over the wall and check
on produciability may require undoing design
Methods to eliminate silo effect:
(1)
manufacturing sign-off, (2) integrator, (3)
cross-functional team, (4) combine both
functions into one department
35
Millions
2500
2000
1500
1000
500
0
1990
1991
1992
1993
1994
1995
1996
1997
1998
Year
37
Cross-Functional Teams
40
Traditional Product
Development Sequence
Marketing - conducts research to identify
customers needs and defines product features
(functionality, reliability, ease of repair, resale
value, warranty, price, etc.)
Design Engineering - develops specifications,
performs functional design, selects material,
obtains vendor/supplier inputs, and conducts
engineering analysis to create product features
41
Traditional Product
Development Sequence (Contd)
Production Engineering - reviews and
simplifies the product design for
manufactureability and reliability
considerations.
Service organization - changes the design
some more for serviceability.
Production - finally develops manufacturing
techniques and makes the product.
42
Cross-Functional
Product Development Team
Representatives of all functional groups are
participating, in addition to procurement,
financial, vendors/suppliers and customers
Issues related to product design/development
are considered early on and concurrently
Create an optimum product in shortest time, at
lowest cost, while satisfying constraints and
meeting customers needs
43
Benefits of
Cross-Functional Teams
Reduction of product development time:
30% to 70%
Reduction of number of engineering
changes: 65% to 90%
Reduction of time to market: 20% to 90%
Improvement in product quality: 200% to
600%
44
Successful Examples of
Concurrent Teams
Mercury Computers, Lowell, MASS - Reduced
time to market from 125 days to 90 days for its addon boards of VNE bus
Hewlett Packard, Palo Alto, CA - Reduced the
time to market by 2/3 for its 54600 Oscilloscope
Toyota Motors, Tokyo, Japan - Reduced product
cost by 61%
Medical Electronic Instruments Reduced the
time to market from eight months to one.
45
Team Discipline
Team Learning
Team Effectiveness
46
Team Discipline
For achieving blow-the-roof-off performance,
teams must have discipline: (1) common
purpose, (2) specific goals of performance, (3)
complementary skills, (4) commitment to how
the work gets done (each pulling the same
weight), (5) mutual accountability - commitment
and mutual trust, being accountable to each
other - being in the boat together
47
Team Learning
Team must learn quickly all needed skills
(process of working together, use of design
tools, communications)
Factors affecting team learning speed: (1)
composition (a mix of expertise)
(2)
culture of risk taking allowing
experimentation
(3)
people-oriented leadership Style
48
Team Effectiveness
Team Goals are clear, of high impact, measurable
and with top management support
Members are results-oriented, efficient, having
complementary skills and experience, high energy
level, positive attitude to collaborate, each
supported by staff with specific expertise
Work Environment is excellent (easy to use
communications tools, opportunity for selfexpression, pleasant work atmosphere, etc.)
49
Team Stages
Formation Stage - Members get together
to have roles and responsibilities defined
Gelling Stage - Members of like minds will
form subgroups and stay close together
Unison Stage - All team members are
getting highly organized with a common
goal
54
Question # 3.5
The company has been making most of its
sales to a few large customers. The
company president wishes to broaden its
customer base. To do so may require a
change of company culture, its product line
strategy, its marketing/sales program, and
its service organization. How should he go
about making the required changes?
55
Question # 3.7
As the companys sales are coming down
unexpectedly, the president asks you to
chair a task force with the objectives of
developing solutions to correct the
situation. Who do you want to be on this
task force? How should this problem be
resolved?
56
Delegating
Objective - To improve managers overall
efficiency by selectively distributing work
for employees to do
Process - Managers delegate the
responsibility and needed authority of doing
specific work to employees and create
upward accountability in them for securing
the anticipated results
57
Why Delegating
Improve quality and quantity of work done
Allow manager to do managers job
Become knowledgeable of employees
capabilities
Distribute work load efficiently/equitably
Develop leadership capabilities in people
Improve operating decisions - reducing cost
58
Why Delegating
Facilitate teamwork, making job more
satisfying to employees
Create opportunities for employees to gain
recognition, encouragement and incentives
Allow employees to develop new skills and
knowledge, fostering initiative and
competence, and gaining self-confidence
Encourage employee growth/development
59
Delegation Matrix
1: Employee
Can
2: Neither; if must,
then to be done
by engineering
manager
3: Employee
Employee
Cannot
Cannot
Can
4: Engineering
manager
Engineering Manager
60
What to Delegate
Problems/Issue requiring exploration, study and
recommendation for decision making
Activities coming within the job scope and
capabilities of employee
Tasks fitting companys needs and promoting
employee development and growth
Activities, if done right, would save managers
time
61
How to Delegate
Communicate the importance of task, set goals
and performance indicators, check on
understanding/confidence
Delegate responsibility for quality of work
Allow operational decision making (resources,
method, sequence of tasks, etc.)
Trust the employee and give recognition
Retain own upward accountability
63
Barriers to Delegation
Own technological obsolescence Employee may learn and grow technically
Organizational barriers - unclear roles and
responsibilities, line and staff positions
64
Notes on Delegation
Delegation is limited by control in effect - no
control, no delegation
Authority must be commensurate with
responsibility (related to work delegated)
Accountability - Achieving the expected results
by discharging responsibility and using
authority delegated
Willingness and ability of employee are keys
65
Question # 3.9
Steve Lee, the Engineering Manager, delegates tasks as a
good manager should. However, Mark Hayes, the
Engineering Director, has the bad habit of calling up
Steve unexpectedly to get detailed reports on various ongoing activities in Steves department. Steve does not
want to hold daily staff meetings in order to satisfy
Marks information needs, because Steve is quite certain
that requiring his professional staff to make daily reports
will definitely upset them, as all of them are known to
prefer independence. What should Steve do?
66
Establishing Working
Relationships
Purpose - To create an environment in
which people can work together efficiently
Steps: (1) clarify roles and (2) resolve
conflicts
67
Types of Roles
Line Roles (Profit Centers) - (1) Exclusive rights to
offer product/service to customers (e.g., production,
product design, business management, marketing),
(2) Accountable for generating profits (pricing, cost)
Support Roles (Cost Centers) - (1) Rights to
recommend/advise (e.g., legal, R&D, accounting,
etc), (2) Accountable for offering active support
(cost efficiency, work method, evaluation)
68
3
2
2
2
2
4
6
5
6
5
3
3
4
6
4
2
4
5
2
2
2
Project Office
Department Manager
69
Type of Conflicts
Technical (e.g., design, analysis, results
interpretation)
Operational (how to do tasks, who is
responsible?)
Emotional (ego involvement, hurt feelings)
Political (who should have a say on what?
whos turf it is?)
70
Informal Organizations
Useful in add additional bonding between employees
(smooth operation, employee satisfaction)
Social (Shared values and beliefs -golf club, bowling
clubs, credit union)
Status (Based on skills, abilities, experience, special
accomplishments, peer recognition)
Group (Coalitions to advance specific interests)
Location (Flow of vital information - Executive
secretary)
72
Conclusions
Organizing is a key managerial function, which
impacts on the managers capability of getting
work done efficiently:
(1) Get oneself
organized,
(2) Choose the right
organizational settings, (3) Assign compatible
people (personality, value, attitude) to work
together,
(4) Allocate the right
resources (skills, money, equipment, time,
technology).
73
References
2-1
C. A. Bartlett and S. Ghoshal, Matrix Management: Not a Structure, a Frame of
Mind, Harvard Business Review, pp. 138-45 (July-August 1990).
2-2
D. J. Duck, Managing Change: The Art of Balancing, Harvard Business Review,
pp. 109-118 (NovemberDecember 1993).
2-3
J. J. Gabarro and J. P. Kotter, Managing Your Boss, Harvard Business Review, pp.
150-157 (May-June 1993)
2-4
R. H. Schaffer and H. A. Thomson, Successful Change Programs Begin with
Results, Harvard Business Review, pp. 80 89 (January-February 1992)
2-5
A. van de Lliet, To Beat the Best, Management Today, pp. 56-60 (January 1996)
2-6
R. M. Kanter, Collaborative Advantages: The Art of Alliance, Harvard Business
Review, pp.96-108 (July-August 1994)
2-7
John A. Byrne, Managements New Gurus, Business Week, pp. 44-51 (August 31,
1992)
74
Question # 3.3
The company has recently concluded a multimillion dollar
contract to supply products to a third-world country. The
first elite group of engineers from that country has just
completed a two-month training course on maintenance
and operations. The training manager reported that the
level of skill and knowledge of that country was so low
that no amount of training would ever enable them to
properly operate and maintain the products in questions.
It might be better for that country to buy a less
sophisticated product from the companys competitor. the
training manager suggests. What should the company do?
75
Question # 3.4
Six months ago, the company hired an engineer for
his expertise in hydraulic drives, based on a product
development plan with a forecast for needing this
expertise. Market conditions have suddenly changed
in favor of sophisticated electric drives. The
engineer involved turns out to be very good in his
area of specialization. But it is difficult to retrain
him for other assignments in the company. Should
the company discharge this engineer?
76
Question # 3.6
The company is considering a plan to upgrade
its current product line. The cost of product
upgrade is high. There is a small company
which has developed the technology required
for this product upgrade. What strategy
should the company follow, if it wants to
continue selling into its current market with
the new upgraded product?
77
Question # 3.8
A loyal and high volume customer has warned the
companys Marketing department that Project X is
extremely critical to their need and that if this
project is late, they may be forced to buy
elsewhere. The project manager knows that the
best estimates available to date from various inhouse groups indicate that at the current rate of
progress the Project X will be late by about 6
months. What should the project manager do?
78
Question # 3.11
In an organization offering dual-ladder
career progression system, technically
trained people may opt to progress along a
technical ladder, instead of the traditional
managerial ladder. How does it work?
79
Answer # 3.11
Vice President
Director
Director
Fellow
Manager
Manager
Associate
Supervisor
Project Manager
Consultant
Section Engineer
Project Engineer
Senior Engineer
Staff Engineer
Engineer
80
Question # 3.12
P a u l W a rn e r
G e n e ra l M a n a g e r
J im F o le y
P ro g ra m M a n a g e r
R o y B la ir
E n g in e e r in g M a n a g e r
81
Question #3.13
Once the functional manager and project
manager agree on a project schedule, who is
responsible for getting the work performed?
Who is accountable for getting the work
performed? Why the difference, if any?
82
Question #3.14
Because of the individuality of people, there
always exits differing views of what project
management is all about. Below are lists of
possible perspectives and a selected group
of people. Match the people with their
views of project management.
83
Question # 3.14
1. Upper-level managers
2. Project managers
3. Functional managers
4. Project team members
a.
b.
c.
d.
e.
f.
g.
h.
i.
j.
k.
l.
m.
n.
Question # 3.15
The organization chart
of Company X reveals
that different number
of employees reports
to its five departments
shown. How would
you explain the
difference?
Department
Number of
Employees
85
Question # 3.16
Some people feel that working as a team,
instead of allowing experts to produce more
creative outcomes, actually resulted in
watered-down compromises and bland
solutions. They view teamwork as a series
of exercises in sharing ignorance. Do
you agree or disagree and why? What can
be done to improve the technical qualities
of the team outcomes?
86