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ENGINEERING MANAGEMENT INTERMEDIATE PLAN – designed to support strategic plan

CH. 3 (Planning Technical Activities)

PLAN - provides a methodical way of achieving desired results

and serves as a useful guide.

PLANNING

- involves anticipating future trends and

determining the best strategies and tactics to
achieve organizational activities. (Nickels and
others)

- Selection and sequential ordering of tasks

required to achieve an organization goal (Aldag &
Stearns)
- 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. (Cole &Hamilton)
OPERATIONAL PLANNING – process of determining how
specific tasks can best be accomplished on time with available
resources.
PLANNING PROCESS
Planning involves the following:

1. Setting organizational, divisional, or unit goals

LEVELS 2. Developing strategies or tactics to reach those goals
1. Top Management Level – strategic planning 3. Determining resources needed
2. Middle Management Level – intermediate planning 4. Setting standards
3. Lower Management Level – operational planning

STRATEGIC PLANNING – process of determining the
contributions that subunits can make with allocated
resources to achieve goals.
STRATEGIC PLAN – the decision about long-range goals and
the course of action to achieve these goals.
INTERMEDIATE PLANNING – process of determining the
contributions that subunits can make with allocated
resources.
GOALS – precise statement of results sought, quantified in
time and magnitude, where possible.
STRATEGY – course of action aimed at ensuring that
organization will achieve its objectives
TACTICS – short term action taken by management to adjust
to negative internal or external
TACTICAL PLAN - decision about short term goals and the
courses of action are indicated in tactical plan

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STANDARD – quantitative or qualitative measuring device
designed to help monitor the performances of people, capital
goods, or processes.
TYPES OF PLANS
b. Procedures – plans that describe the exact
series of actions to be taken in a given situation
c. Rules – statements that either require or forbid
a certain action

FUNCTIONAL AREA PLANS
1. Marketing Plan – for implementing and controlling an
organization’s marketing activities related to a
particular marketing strategy
2. Production Plan – states the quantity of output a
company must produce in broad terms and by product
family
3. Financial Plan – summarizes the current financial
situation of firm, analyzes financial needs, and
recommends a direction for financial activities
4. Human Resource Management Plan – indicates the
human resource needs of a company detailed in terms
of quantity and quality and based on the requirements
of the company’s strategic plan.
2. Single Use Plans – plans are specifically developed to
implement courses of action that are relatively unique
and are unlikely to be repeated.
a. Budgets
b. Programs
c. Projects
BUDGET – a plan which sets forth the project expenditure for
a certain activity and explains where the required funds will
come from.
PROGRAM – single-use plan designed to coordinate a large set
of activities
PROJECT – usually more limited in scope than a program and
is sometimes prepared to support a program.

PLANS WITH TIME HORIZON CONTENTS OF MARKETING PLAN (William Cohen)

1. Short-range Plans – plans intended to cover a period of 1. Executive Summary

less than one year 2. Table of Contents
2. Long-range Plans – plans covering a time span of more 3. Situational Analysis and Target Market
tha one year 4. Marketing Objectives and Goals
5. Marketing tactics
PLANS ACCORDING TO FREQUENCY OF USE 6. Schedules and Budgets
1. Standing Plans – plans that are usedagain and again 7. Financial Data and Control
and they focus on managerial situations that recur CONTENTS OF PRODUCTION PLAN
repeatedly.
1. The amount of capacity the company must have
a. Policies – broad guidelines to aid managers at 2. How many employees are required
every level in making decisions about recurring 3. How much material must be purchased
situations or function

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CONTENTS OF FINNACIAL PLAN 5. Focusing on the present at the expense of future

6. Too much reliance on planning department
1. An analysis of the firm’s current financial condition as 7. Concentrating on only controllable variables
indicated by an analysis of most recent statements
2. A sales forecast ✓ AIDS TO PLANNING
3. Capital Budget 1. Gather as much information as possible
4. Cash Budget 2. Develop multiple sources of information
5. Set of pro forma (or projected) financial statements 3. Involve other in the planning process
6. External financing Plan

CONTENTS OF HUMAN RESOURCE PLAN

CH. 4 Organizing Technical Activities
1. Personnel requirements of company
2. Plans of recruitment and selection ORGANIZING – structuring of resources and activities to
3. Training plan accomplish objectives in an efficient and effective manner
4. Retirement plan
PURPOSE OF STRUCTURE
PARTS OF STRATEGIC PLAN
✓ Defines the relationship between tasks and authority
1. Company or corporate mision – strategic statement for individuals and departments
that identifies why an organizaton exists, its ✓ Defines formal reporting relationships, the number of
philosophy or mangement, and its purpose as levels in the hierarchy of organization and span of
distinguished from other similar organizations in control
terms of products, services, and markets ✓ Defines the groupings of individuals into departments
2. Objectives or goals and departments into organization
3. Strategies ✓ Defines the system to effect coordination of effort in
both vertical (authority) and horizontal (tasks)
MAKING PLANNING EFFECTIVE directions
✓ Planning may be made successful if the ff are When structuring an organization, the engineer manager must
observed: be concerned with the ff:
1. the planning barriers
2. Use of aids to planning 1. Division of Labor – determining the scope of work and
how it is combined in a job
✓ Planning Bariers (Plankett & Attner) 2. Delegation of Authority – process of assigning various
1. Manager’s inablity to plan degrees of decision-making authority to subordinates
2. Improper planning process 3. Departmentation – grouping of related jobs, activities,
3. Lack of commitment to the planning process or processes into major organizational subunits
4. Improper information

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4. Span of Control – number of people who report directly
to a given manager
5. Coordination – linking of activities in the organization
that serves to achieve a common goal or objective
FORMAL ORGANIZATION
- Structure that details lines of responsibilities,
authority and position.
- Planned structure and it represents the deliberate
attempt to establish patterned relationships among
components that will meet the objectives effectively
ORGANIZATION CHART – diagram of the organization’s official
positions and formal lines of authority
ORGANIZATIONAL MANUAL – provides written descriptions of
authority relationships, details the functions of major
organizational units, and descreibes job procedures
POLICY MANUAL – describes personnel activities and
company policies
INFORMAL GROUPS
- vulnerable to expediency, manipulation, and
opportunism.
- Members of an organization spontaneously form a
group with friendship as a principal reason for
belonging
TYPES OF ORGANIZATIONAL STRUCTURES
1. Functional Organization
- form of departmentalization in which everyone
engaged in one functional activity is grouped
into one unit
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- single-business firms where the key activities
revolve around well-defined skills and areas of
specialization
ADVANTAGES
1. The grouping of employees who perform a common
task permit economies of scale and efficient
resource use.
2. Since the chain of command converges at the top
of the organization, decision-making is centralized,
providing a unified direction from the top.
3. Communication and coordination among
employees within each department are excellent.
4. The structure promotes high-quality technical
problem solving.
5. The organization is provided with in depth skill
specialization and development.
6. Employees are provided with career progress
within functional departments.
DISADVANTAGES
1. Communication and coordination between the
department are often poor.
2. Decisions involving more than one department pile
up at the top management level and are often
delayed.
3. Work specialization and division of labor, which
are stressed in a functional organization, produce
routine, nonmotivating employee tasks.
4. It is difficult to identify which section or group is
responsible for certain problems.
5. There is limited view of organizational goals by
employees.
6. There is limited general management training
employees.
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2. Product or Market Organization
- organization of a company by divisions that
brings together all those involved with a
certain type of product
- appropriate for a large corporation with many
product lines in several related industries
ADVANTAGES
1. The organization is flexible and responsive to
change.
2. The organization provides a high concern for
customer’s need.
3. The organization provides excellent coordination
across functional departments.
4. There is easy pinpointing of responsibility for
product problems.
5. There is emphasis on overall product and division
goals.
6. The opportunity for the development of general
management skills is provided.
DISADVANTAGES
1. There is a high possibility of duplication of
resources across division.
2. There is less technical depth and specialization in
divisions.
3. There is poor coordination across divisions.
4. There is less top management control.
5. There is competition for corporate resources.
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3. Matrix Organization
- employee reports to both a functional or
division manager and to a project or group
manager
- structure with two or more channels of
command, two lines of budget authority and
two sources of performance and reward.
ADVANTAGES
1. There is more efficient use of resources than the
divisional structure.
2. There is flexibility and adaptability to changing
environment.
3. The development of both general and functional
management skills are present.
4. There is interdisciplinary cooperation and any
expertise is available to all division.
5. There are enlarged tasks for employees which
motivate them better.
DISADVANTAGES
1. There is frustration and confusion from dual chain
command.
2. There is high conflict between divisional and
functional interests.
3. There are many meetings and more discussion
than action.
4. There is a need for human relations training for
key employees and managers.
5. There is a tendency for power dominance by one
side of the matrix.
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TYPES OF AUTHORITY
AUTHORITY - is the right to perform or command. It allows its
holder to act in certain designated ways and to directly
influence the actions of others through orders.
1. Line Authority
- Hierarchical form of authority
- a manager’s right to tell subordinates what to
do and then see that they do it.
2. Staff authority
- a staff specialist’s right to give advice to a
superior
- has right to direct or command subordinates
who work under them but with respect , play
an advisory role in recommending and assisting
3. Functional Authority
- a specialist’s right to oversee lower level
personnel involved in that specialty regardless
of where the personnel are in the organization.
PERSONAL STAFF – assigned to a specific manager to provide
needed staff services
SPECIALIZED STAFF – providing needed staff for the whole
organization
COMMITTEE - Formal group of persons formed for a specific
purpose
PRODUCT PLANNING COMMITTEE – often staffed by top
executives from marketing, production, research, engineering,
and finance, who work part-time to evaluate and approve
product ideas
AD HOC COMMITTEE – short-term purpose and have a
limited life
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STANDING COMMITTEE – relatively permanent committee
that deals with issues on an ongoing basis
CH. 5 Staffing the Engineering Organization
STAFFING – management function that determines human
resources needs, recruits, selects, trains, and develops human
resources for jobs created by an organization
STAFFING PROCEDURE
A. HUMAN RESOURCE PLANNING
Three activities:
a. Forecasting – assessment of future human
resource needs in relation to the current
capabilties of organization
b. Programming – translating the forecasted
human resource needs to personnel objectives
and goals
c. Evaluation and Control – monitoring human
resource action plans and evaluating their
success
Method of Forecasting – forecasting of manpower needs may
be undertaken
1. Time Series Method – use historical data to develop
forecasts of the future
2. Explanatory or casual models – attempts to identify
the major variables that are related to have or have
caused particular past condtions and then use current
measurments of these variables to predict future
condition
a. Regression models
b. Econometric models – system of regression
eqautions from past time series data and used
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to show the effect of various independent
variable n various dependent variables
c. Leading indicators – refers to time series that
anticipate business cycle turns
B. RECRUITMENT – refers to attracting qaulified persons
to apply for vacant positions in the company so that
those who are best suited to servethe company may
be selected.
SOURCES OF APPLICANTS
a. Organization’s current employees
b. Newspaper advertising
c. Schools
d. Referrals from employee
e. Recruitment firms
f. Competitors
C. SELECTION – act of choosing from those that are
available the individuals most likely to succeed on the
job.
WAYS OF DETERMINING THE QUALIFICATION O
JOB CANDIDATE
1. Application Blanks – provides information
about a person
2. References – written by previous employers, co-
workers
3. Interview
4. Testing- evaluation of future performance
TYPES OF TESTS
1. Psychological Tests – an objective standard
measure of a sample behavior
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a. Aptitude test – to measure a persons
capacity or potential
b. Performance Test – to measure a
person’s current knowledge of a subject
c. Personality Test – to measure
personality traits
d. Interest Test – to measure a person’s
interest in various field of work
2. Physical Examination – to assure that the
health of the applicant is adequate to meet the
job requirements
D. INDUCTION AND ORIENTATION
INDUCTION - the new employee is provided with the
necessary information about the company
ORIENTATION -the new employee is introduced to the
immediate working environment and co-workers
SOCIALIZATION PROCESS – The new emplyee is
paired with an experienced employee and having one-
on-one discussion with the manager
E. TRAINING AND DEVELOPMENT
TRAINING – learning that is provided in order to
improve performance on the present job.
Two general types:
1. Training programs for nonmanagers
a. On-the-job Training
b. Vestibule School – where the trainee is
placed in a situation almost exactly the
same as the workplace wehere
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machines, materials and time
constraints are present
c. Apprenticeship Program – combination
of ojt and experiences with classroom
instruction in particular subject
d. Special Courses – education rather than
training
2. Training and educational progrmas for
executives (Training Program for managers)
Training needs:
a. Decision Making Skills
1. In-basket – the trainee is provided with set of
notes messages, telephone calls, letters
pertaining to a certain company situation
2. Management games – trainees are faced with a
simulated situation and required to make an
ongoing series of decisions
3. Case Studies – presents actual situation in
organizations and enable to examine successful
and unsuccesful operations
b. Interpersonal Competence
1. Role-playing
2. Behavior modeling – showing model
persons behaving effectively in a problem
situation
3. Sensitivity training – awareness and
sensitivity to behavioral pattern are
developed
4. Transactional analysis – to improve their
interpersonal communication skills
c. Job Knowledge
1. On-the-Job experience
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2. Coaching
3. Understudy – a managers works as
assistant to a higher level manager ang
participate in managerial functions
d. Organizational Knowledge
1. Position Rotation
2. Multiple management – premised on the
idea that junior executives mustbe provided
with means to prepare them for higher
management functions
F. PERFORMANCE APPRAISAL – measurement of
employee performance
Purposes:
✓ To influence, in a positive manner, employee
performance and development
✓ To determine merit pay increase
✓ To plan for future performance goals
✓ To determine training and development needs
✓ To assess the promotional potential employees
Ways of Appraising Performance
1. Rating scale method –
2. Essay Method – evaluator composes
statements that best describe the person
3. Mangament by objectives method – evaluated
on the basis of how well they have achieved the
results specified by the goals
4. Assessment center Method – evaluated by
persons other than the immediate suprior
5. Checklist Method –
6. Work standards Method – standards are set for
the realistic worker output and used in
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evaluating the performance of nonmanagerial 4. Emotive Function

employee
7. Ranking Method COMMUNICATION PROCESS
8. Critical Incident Method – recalls and writes A. DEVELOP AN IDEA – most important step in effective
down specific incidents that indicate the communication
employee’s performance
B. ENCODE – to encode ideas into words, illustrations,
G. EMPLOYMENT DECISIONS figures or other symbols suitable for transmission
a. Monetary Rewards – given to employees whose
performance is at par or above standard C. TRANSMIT – the message is ready for transmission
requirements through the use of appropriate communication
b. Promotion channel (spoken word, body movements,radio, etc.)
c. Transfer – movement of person to a different job at
similar level D. RECEIVE – actual receiving of the message by the
d. Demotion intended receiver

E. DECODE – translating the message from the sender

H. SEPARATION – either a voluntary or involuntary into a form that will have meaning to the recipient
termination of an employee
F. ACCEPT – to accept or reject the message
INVOLUNTARY SEPARATION – last option that the
management excersises when an employee’s Factors that will affect the acceptance or rejection
performance is poor or committed a violation 1. The accuracy of the message
2. Whether or not the sender has the authority to
send the message and/or require action
CH. 6 Communicating 3. Behavioral implications for the receiver

COMMUNICATION – a process of sharing information through G. USE – use the information

symbols, including words and message. (Wolfs & Kuiper) H. PROVIDE FEEDBACK – last step in the
communication process. Receiver provide feedback to
Functions of Communication
the sender
1. Information Function –
2. Motivation Function – used as a means to motivate
FORMS OF COMMUNICATION
employees to commit themselves to the organization’s
objectives 1. VERBAL – transmitted through hearing and sight.
3. Control Function

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a. Oral communication – involves hearing the
words of the sender
b. Witten Communication – seeks to communicate
through written words
2. NONVERBAL COMMUNICATION – means of conveyng
message through body language, as well as the use of
time, space, touch, clothin, appearance, and aesthetic
elements
4. Use simplified language that is easily understandable
and which eliminates the possibility of people getting
mixed-up with meanings
TECHNIQUES FOR COMMUNICATING IN ORGANIZATIONS
A. DOWNWARD COMMUNICATION - message flows
from higherlevels of authority to lower levels

BARRIERS TO COMMUNICATION Purposes:

a. To give instructions
1. PERSONAL BARRIERS – hindrances to effective b. To provide information about policies and
communication arising from a communicator’s procedures
characteristics as a person, such as emotions, values, c. To give feedback about performance
poor listening habits, etc. d. To indoctrinate or motivate

2. PHYSICAL BARRIERS – interferences to effective TECHNIQUES

communication occuring in the environment where the a. Letters
communication is undertaken b. Manuals
c. Handbooks
3. SEMANTIC BARRIERS – interference with the d. Newsletters
reception of a message that occurs when the message
is misunderstood even though it is received exactly as B. UPWARD COMMUNICATION – refers to messages
transmitted from persons in lower-level positions to persons in
higher positions

OVERCOMING BARRIERS TO COMMUNICATION TECHNIQUES

1. Use feedback to facilitate understanding and increase
the potenitial for appropriate action
2. Repeat messages in order to provide assurance that
they are properly received
3. Use multiple channels so that the accuracy of the
information may be enhanced
a. Formal Grievance Procedure – any employee’s
concern over a perceived violation of the labor
agreement that is submitted to the grievance
procedure for eventual resolution
b. Employee attitude and Opinion Surveys –
c. Suggestion Systems

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d. Open-Door Policy – provides the management Purpose:

with an opportunity to act on difficulties before
they become full-blown problems a. To provide a basis for the analysis of early
e. Informal Gripe sections - When employees feel warning signalas that can originate both
free to talk and they are assured of not being externally and internally
penalized for doing so, then management will b. To automate routine clerical operations like
be spared with lots of e±orts determining the payroll and inventory reports
real causes of problems in the company
f. Task Force - when a specifc problem or issue
arises , a task force may be created and
assigned to deal with the problem or issue
g. Exit Interviews - when employees leave an
organization ±or any reason , it is to the
advantage o± management to know real reason

HORIZONTAL COMMUICATION – messages sent to

individuals or groups from another of the same organizatonal
level or position

Purposes:

a. To coordinate activities between departments

b. To persuade others at the same level of organization
c. To pass on information about the activities or feelings

MANAGEMENT INFORMATION SYSTEM (MIS)

- An organized metho providing past, present,

and projected information on internal
separations and external intelligence for use in
decision making
- Written and electronically based sytems for
sending reports, memos, bulletins and the like

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