ENGINEERING MANAGEMENT

MANAGEMENT FUNCTION - PLANNING

 Objective
To introduce the meaning and importance of
Planning and Management. Also, to discuss the
functions of management, different types of
planning and other related activities of planning.

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 PLANNING
the work done to predetermine a course of action, in order to provide focus and
direction for enhancing the efficiency and effectiveness of the company.

Defines: who, how, where, when, and using which resources to do the what work

Planning is necessary due to the changes on Technology, Environment and

Organization.

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Planning is made necessary by rapid
change of :
(a) Technology ( web-based tools,
broadband communications options,
mobile access),
(b) Environment (globalization,
competition, marketplace), and
(c) Organization (mergers &
acquisitions, networks, outsourcing
and alliances)
 TYPES of PLANNING:
Strategic Planning
Involves analysing
competitive opportunities
and threats, as well as the
strengths and weaknesses
of the organization to
compete effectively in
their environment.
Operation Planning
Covers the entire Tactical Planning
organization’s goals and
objectives and puts into
Creates the blue print for
practice the ways and
the larger strategic
action steps to achieve the
planning. These plans are
strategic plans. Very short
often short term and are
term plans, usually less
carries out by middle-level
than a year.
managers.
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Strategic Planning
Sets the goals, purpose, and
direction of a company.
The Top-Level Engineering
Managers are usually involved in
SP for the company.
Includes the company’s vision,
mission and value system
Specific goals – profitability,
market share, sales, technology
leadership position, global
penetration – to accomplish by
when, with what investment and
which technology
Which business networks/
partnerships to create (suppliers,
co-marketing, production,
logistics, service)? 6
 MISSION
A mission statement is vital to the success
of a company as a whole. It can unify a
company and push them to new heights.
Creating a mission statement is just as
important for a small company starting
out.

Why do we exist?

Whom are we serving?

What do we do to serve
them?

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 VISION
Creating a clear and effective vision
delivers many benefits to your business.
Not only does a clear, shared vision help
define the values of your company and its
employees, but it also helps guide the
behavior of all employees. A strong vision
also leads to improve productivity and
efficiency.

Vision – Company Aspiration

Market capital
Business standing

Ranking in industrial
sector
Market Share 8

Others
 SAMPLE
CORPORATE VALUES

• opportunity
• Innovation • Stability • Respects for others
• Honesty • Collaboration • Open communications
• Quality • Accountability • Empowerment
• Social responsibility • Trust and openness • Initiative
• Diversity and equal
• Continuous improvement • Quality of work life
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TOOLS FOR STRATEGIC PLANNING

Market Research
SWOT Analysis
Sensitivity Analysis
External benchmarking
Technology forecasting
Product life cycle analysis

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 TYPES OF STRATEGIC PLANNING:

1. Developing the mission

2. Analyzing the environment

3. Setting objectives

4. Developing strategies (corporate,

business,and functional levels)

5. Implementing and controlling strategies

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 Different Strategic Level

CLS FLS
BLS
The plan for The plan for
managing The plan for managing managing one
multiple lines of one line of business area of the
businesses business

CORPORATE FUNCTIONAL
LEVEL STRATEGY LEVEL STRATEGY
BUSINESS
LEVEL STRATEGY
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SWOT ANALYSIS
EXAMPLE: SWOT Analysis for
Starbucks Coffee

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Strategies for Starbucks over the Product Life Cycle

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 OPERATIONAL
PLANNING
What is the most efficient way of
OPERATIONAL PLANNING
accomplishing QUESTIONS
a project/task with
known objectives (doing things
right) ?

How to link up with three best

suppliers in the marketplace for
parts needed?
Define tasks/events to be accomplished
What are the operational guidelines
with the least amount of resources
for performing specific work?
within the shortest time, to assure that
the company applies its resources
efficiently to achieve its short-term and
long-term goals. 15
 TOOLS FOR OPERATIONAL PLANNING
• Project management including action planning
• Design, test and analysis procedures
• Operational guidelines
 ACTIVITIES RELATED TO PLANNING

FORECASTING – To estimate and predict future conditions and events – e.g.

technology, products, marketplace-customer, competition and economy, global
supply chains, manpower, capital and facilities.
ACTION PLANNING - The process of establishing specific objectives, action steps, and
a schedule and budget related to a predetermined program, task or project.

ISSUING POLICIES - Policies are directives, promulgated to address repetitive

questions and issues of general concern.
Purposes: Save management time and efforts, Capture the distilled experience and
past learning of the company, and Facilitate delegation.
Characteristics: Apply uniformly to all employees, Being relatively permanent when in
force, and Foster corporate objectives.
ESTABLISHING PROCEDURES - Procedures are standardized (tried-and-true) method
of performing work
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 ACTION PLANNING STEPS

DEVELOP BUDGET
Determine the basic resources units (man-hours, man-weeks) to accomplish each steps
Define other resources (computation, travel expenses, materials, experiments, equipment
usage, pilot tests, contract services, support staff, management review, etc.)
Revise action steps, if projected cost exceeds value expected

REMARKS ON ACTION PLANNING

- Involve doers in action planning
- Apply computer-based tools (e.g., Microsoft Project, Timeline) to generate PERT or GANTT charts
- Include risks and contingency steps
- Iterate planning process until all parties (top management, doers, team leader, service providers, etc.)
involved are satisfied
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Planning is an important engineering management function, involving (1)
forecasting, (2) action planning (3) issuing policies and (4) establishing
procedures
Forecasting and strategic planning are difficult, with performance being
unpredictable
Others planning activities are administrative/ operational in nature and
should appear relatively easy to everyone
The company has always been focused on the high-quality high-
price end of the market. Now, market intelligence indicates that
some competitors are planning to enter the low-price low-quality
end of the market. What should the company do?
THANK YOU!