MODULE 2 OVERVIEW
(ES 313 – Engineering
Management)
A very important function that an engineer
manager must possess are some skills in decision-
DECISION-MAKING making. For the fate of his organization’s rise or fall will
depend greatly on the outcome of his decisions.
This module presents the concept of decision-
making and the decision-making process applied at
various management levels and functions.
Engr. Leo M. Sauro, D.M.
(+63)-9451136579
[email protected] LEARNING OUTCOMES
Students should be able to understand the
decision-making process and recognize decision-making
as a management responsibility.
INTRODUCTION
Managers of all kinds and types, including the
engineer manager, are primarily tasked to provide
leadership in the quest for the attainment of the
organization’s objectives. If he is to become effective, he
must learn the intricacies of decision-making. Many times
he will be confronted by situations where he will have to
choose from among various options. Whatever his
choice, it will have effects, immediate or otherwise, in the
operations of his organization..
A major blunder in decision-making may be
sufficient to cause the destruction of any organization.
Good decisions on the other hand, will provide the right
environment for continuous growth and success of any
organized effort.
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Lesson 1: DECISION-MAKING AS A MANAGEMENT
RESPONSIBILITY
Decision-making is a responsibility of the engineer
manager. It is understandable for managers to make
wrong decision at times. The wise manager will correct
them as soon as they are identified. The bigger issue is
the manager who cannot or do not want to make
decisions. William A. Delaney concludes that this type of
managers are dangerous and “should be removed from
their position as soon as possible.”
Management must strive to choose a decision
option as correctly as possible.
Lesson 2: WHAT IS DECISION-MAKING?
Decision-making may be defined as “the process
of identifying and choosing alternative courses of action
in a manner appropriate to the demands of the situation.”
Decisions are made at various management levels
(i.e. top, middle, lower levels) and at various
management functions (i.e. planning, organizing,
directing, and controlling). Decision-making according to
William G. Nickels and others, “is the heart of all the
management functions.”
Lesson 3: THE DECISION-MAKING PROCESS
Rational decision-making, according to David H.
Holt is a process involving the following steps:
1. Diagnose problem
2. Analyze the environment
3. Develop viable alternatives
4. Evaluate alternatives
5. Make a choice
6. Implement decision
7. Evaluate and adapt decision results
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Diagnose Problem
If a manager wants to make an intelligent decision,
his first move must be to identify the problem. If the
manager fails in this aspect, it is almost impossible to
succeed in the subsequent steps. An expert once said
“identification of the problem is tantamount to having the
problem half-solved.”
What is a problem? A problem exist when there is
a difference between an actual situation and a desired
situation.
ASSESSMENT – Activity 1
The management of a construction company
entered into a contract with another party for the
construction of a 25-storey building on a certain site. The
actual situation of the firm is that it has not yet
constructed the building. The desired situation is the
finished 25-storey building.
Can you identify the problem in this situation?
Analyze the Environment
The environment where the organization is
situated plays a very significant role in the success or
failure of such an organization it is therefore very
important that an analysis of the environment be
undertaken. The objective of environmental analysis is
the identification of constraints, which may be spelled out
as either internal or external limitations.
Example of internal limitations are as follows:
1. Limited funds available for the purchase of
equipment
2. Limited training on the part of employees
3. Ill-designed facilities.
Example of external limitations are as follows:
1. Patents are controlled by other organizations
2. A very limited market for the company’s products
and services exists.
3. Strict enforcement of local zoning regulations.
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ASSESSMENT – Activity 2
The president of a new chemical manufacturing
company made a decision to locate his factory in a place
adjacent to a thickly populated area. Construction of the
building was made with precision and was finished in a
short period. When the clearance for the commencement
of operation was sought from local authorities, this could
not be given. It turned out that the residents opposed the
operation of the firm and made sure that no clearance is
given. The president decided to relocate the factory but
not after much time and money has been lost.
Discuss the situation where the management fail
to consider in their decision-making.
Develop Viable Alternatives
Oftentimes, problems may be solved by any of the
solutions offered. The best among the alternative
solutions must be considered by management. This is
made possible by using a procedure with the following
steps:
1. Prepare a list of alternative solutions
2. Determine the viability of each solution
3. Revise the list by striking out those which are not
viable
ASSESSMENT – Activity 3
An engineering firm has a problem of increasing its
output by 30%. This is the result of a new agreement
between the firm and one of its clients. The list of
solutions prepared by the engineering manager shows
the following alternative courses of action:
1. Improve the capability of the firm by hiring more
workers and building additional facilities;
2. Secure the services of subcontractors;
3. Buy the needed additional output from another firm
4. Stop serving some of the company’s customers;
5. Delay servicing some clients.
Revise the list to only two or three alternatives you
deemed to be viable.
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Evaluate Alternatives
After determining the viability of the alternatives
and a revised list has been made, an evaluation of the
remaining alternatives is necessary. This is important
because the next step involves making a choice.
How the alternatives will be evaluated will depend
on the nature of the problem, the objectives of the firm,
and the nature of alternatives presented. Win E. Souder
suggests that “each alternative must be analyzed and
evaluated in terms of its value, cost and risk
characteristics.
An example of an evaluation of alternatives is
shown below:
An engineer manager is faced with a problem of
choosing between three applicants to fill up a lone
vacancy for a junior engineer. He will have to set up
certain criteria for evaluating the applicants. If the
evaluation is not done by a professional human resources
officer, then the engineer manager will be forced to use a
predetermined criteria.
A typical evaluation of job applicants will appear as
follows:
_____________________________________________
EVALUATION SHEET
Title of vacant position: JUNIOR ENGINEER
Date of Evaluation: December 28, 2019
Applicant Education Training Experience Age Total Points
1 Jose Sibayan, Jr. 40 35 4 10 89
2 Menandro Rillon 40 36 5 9 90
3 Dante dela Cruz 40 38 6 7 91
Evaluator:
Edgardo J. Viloria
Manager
Engineering Division III
_____________________________________________
Make a Choice
After the alternatives have been evaluated, the
decision-maker must now be ready to make a choice.
This is the point where he must be convinced that all the
previous steps were correctly undertaken.
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Choice-making refers to the process of selecting
among alternatives representing potential solutions to a
problem, identifying all significant consequences of each
choice.
To make the selection process easier, the
alternatives can be ranked from best to worst on the
basis of some factors like benefit, cost, or risk.
Implement Decision
After a decision has been made, implementation
follows. This is necessary, or decision-making will be an
exercise in futility.
Implementation refers to carrying out the decision
so that the objectives sought will be achieved. To make
implementation effective, a plan must be devised.
Evaluate and Adapt Decision Results
In implementing the decision, the results expected
mayor may not happen. It is therefore, important for the
manager to use control and feedback mechanisms to
ensure results and to provide information for future
decisions.
Feedback refers to the 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.
Control refers to actions made to ensure that
activities performed match the desired activities or goals,
that have been set.
In this last stage of the decision-making process,
the engineer manager will find out whether or not the
desired result is achieved. If the desired result is
achieved, one may assume that the decision made was
good. If it was not achieved, further analysis is necessary.
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FEEDBACK
The observations you made in answering the
activities 1, 2 and 3 signify that you now understand the
basic concepts of decision-making especially the
decision-making process. That indicates further that you
are gaining little by little the needed skills when you
become an engineer manager in the near future.
SUMMARY
Decision-making is a very important function of the
engineer manager. His organization will rise or fall
depending on the outcomes of his decisions. It is
therefore necessary for the engineer manager to develop
some skills in decision-making.
The process of identifying and choosing alternative
courses of action in a manner appropriate to the
demands of the situation is called decision-making. It is
done at various management levels and functions.
The decision-making process consists of various
steps, namely: diagnose problem, analyze environment,
develop viable alternatives, evaluate alternatives, make a
choice, implement decision, and evaluate and adapt
decision results.
Note: For Assessment Activities 1, 2 & 3
Use A4 size bond paper for your answer sheets. Submit your
Student Activity/Assessment (hardcopy and handwritten) to
* Engr. Leo M. Sauro @ 274 Hillside Drive UEP Zone III
* College of Engineering Faculty Room or
* thru the UEP municipal link or
* any mode that will be deemed safe for you and me,
on or before Sept 16, 2021.
(Pls indicate on your answer sheets your Name, Subject,
Module #, Activity #, type of exam , etc.)
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SUGGESTED READINGS
https://www.noodle.com/articles/how-to-become-an-
engineering-manager-ready-to-flex-your-eq
https:/www.builtinnyc.com/2020/03/12/day-life-
engineering-managers?
REFERENCES
Medina, Roberto G.(2004). Engineering Management.
REX Book Store.
Baltazar, Jose D. et.al. (2012) Management in the
Philippine Setting. National Book Store.
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