ASEM Blog

Dear ASEM Community,

Hard to believe, but it is time to make plans for the 2023 International Annual Conference already! The conference will take place between October 25th and 28th in the Mile High City, Denver, Colorado where we will be “Climbing Higher with Engineering Management!” The deadline for an abstract is March 6th!

One new addition to the conference this year is our new Practitioner and Industry Track! Along with the outstanding research-focused work we call for, the new track provides an opportunity for authors to highlight key insights and new application challenges that arise from real world implementations of engineering management practice and theory. Please visit our Call for Papers for more information at https://www.asem.org/IAC-CFP where, beside paper submissions, we also encourage you to propose panels and workshops.

In-person presentation will take place on Thursday (October 26th) and Friday (October 27th), and virtual presentation on Saturday (October 28th). For more information about the conference, please visit https://asem.org/Conference. The dates for submissions can be found at https://www.asem.org/IAC_Dates and the submission instructions at https://www.asem.org/IAC-Author-Instructions.

An online Member Town Hall is coming up on February 24th to answer any questions about the conference, moderated by our Executive Director, Dr. Gene Dixon: https://www.asem.org/event-5129153. Many thanks to our hosts at the University of Colorado, Boulder, as well as ASEM’s Conference Planning Committee for working hard to organize an exciting event for all participants, in-person and virtual.

Speaking of events, as you may recall, we have been organizing online open forums to provide updates on new ASEM services and at the same time, to hear from our community to serve them better. These services include a new mentorship program, upcoming workshops, webinars, networking opportunities and many others. Registration to these forums is free and forum participants who are not members will receive an offer of 10% off on membership fees.

Two new forums are coming up in February, one for industry professionals / leaders on Friday, February 10th, 12 – 1:30 pm ET (to receive the Zoom link, pre-register at https://asem.org/event-5150263), followed by the one for academic professionals on Friday, February 17th, 12 – 1:30 pm ET (to receive the Zoom link, pre-register at https://asem.org/event-5150275).

I will be moderating these forums where the participants will have an opportunity to learn about the very latest developments in ASEM, and then have an interactive discussion around five key questions to move this organization forward as it provides the greatest benefit to its members. The forums will also be attended by one of our workshop instructors and Regional Directors, Dr. Larry Mallak, as well as ASEM Communications Director, Patrick Sweet, and Professional Membership Director, LTC Jim Schreiner, Ph.D. They will provide first-hand insight about the contents of our upcoming workshops, new online networking tools, and the ASEM mentorship program. During these sessions, I will make an announcement to establish a team of volunteers as well, so please do not miss these events if you would like to get more closely involved in ASEM.

In summary, we strongly encourage you to consider attending these forums and choose the one that is most appropriate for you (industry or academia). Worldwide participation is most welcome!

Moving on to another important topic, it saddens me to announce that our Executive Director, Dr. Gene Dixon, is stepping down from his position. He has been serving the Society in this role for the last three years, and successfully guided this organization through the unprecedented times of the pandemic. We extend our sincere gratitude to Dr. Dixon for his invaluable leadership.

As a result, ASEM is searching for a new Executive Director (for the ad, please visit https://asem.org/Position-Announcements/. If you are interested in applying for this voluntary leadership position, please submit an application package consisting of a complete resume/CV, a cover letter detailing your interests, including a statement of your objectives and goals if selected, and a recommendation from two members of the society to me at President@asem.org, by March 31st, 2023, with “Executive Director Application” in the message subject line.

Last but not least, let us welcome Thomas J. Day, Ph.D., to ASEM’s Industry Advisory Board (IAB)! Dr. Day is the Program Management Branch Chief at the NOAA’s National Weather Service and Professor of Mathematics and Statistics at the University of Maryland Global Campus. Please note that we are still accepting new industry leaders to the IAB. If you are interested in joining this Board or if you would like to nominate someone, please do not hesitate to contact me at President@asem.org.

I hope to see you online throughout the year and meet you in Denver on October 25th!

Featured in the eNews at https://asem.org/eNews/

• Call for Papers ASEM IAC
• Position Announcement | ASEM Executive Director
• Open Forum for Industry Professionals
• Open Forum for Academic Professionals
• Member Town Hall
• Women in Engineering Management Spotlight
• 2022 hIAC Proceedings is Now Available
• Engineering Management Handbook, 3rd Edition

[This post is by Don Kennedy]

There is a retail spot near my house where I watched many businesses come and go over the years. One business was, yet another, specialty burger place struggling to stay afloat. The owner had a fairly well-paying job on the side that was helping meet the expenses of this restaurant. Near the end, the owner told me that he was struggling to find more ways to cut costs. His vision was to squeeze a few extra dollars profit out of a small revenue number. Most everyone knows that increasing profit is the end goal but there is no clear formula to achieve that. 

Cutting costs seems like a sure thing, but how? Does lowering hourly salary for workers achieve better results, or aggravate turnover and the quality of the worker? Maybe increasing wages entices more productive workers and saves in recruitment or training costs. In the burger joint case, it seemed that the only way to get more income was to increase revenue. Raising prices might work or might reduce the number of customers. Lowering prices should increase numbers of units sold, but will it be enough to make up for the lower revenue per unit? Advertising should increase revenue, but again, will profits be enough to cover the ads? This owner did not have sufficiently deep pockets to find out.

The most recent tenant was a person who started out selling refinished furniture out of her garage. She was almost making enough profit to pay herself a minimum wage, $1600 per month. There is a common adage that one should go big or go home. The concept of economies of scale implies that boosting sales will result in savings in raw material bulk costs, reduce the impact of overhead costs per unit, and create organic growth through word of mouth. The artist realized that selling from one’s garage makes customer awareness very difficult. She correctly surmised that a storefront would attract customers simply from foot traffic. Setting up shop in this retail spot was effective at increasing sales. Two months into operations at the new location, sales and gross profits both doubled. Now that she was making $3200 per month, but then there was the new cost of $3000 rent and only $200 left to pay herself. I see a For Lease sign in the window of the spot once again.

Success in business is complex without any simple formulas to follow. Good concepts often fail due to a lack of understanding of the basic principles.

About Don Kennedy

Dr. Donald Kennedy, Ph.D., P.Eng., IntPE, CPEM, FASEM is a long time contributor to the Practice Periodical. After spending a few decades in the world of heavy industrial construction and operations, Dr. Kennedy finds himself approaching a one year work anniversary in the world of ERP driven operations and assembly line style manufacturing.

[This post is by James Brino, EIT, CAEM]

When I joined my current organization in August of 2021, and before I took over daily management of the engineering department, we did not have a goal setting program. There were informal goals discussed in yearly performance reviews, but there was not a formal process for our Engineers to develop, document, track, and report on their yearly goals (if they had set any at all). In December 2021, I rolled out an Engineering Goal Setting program at PIC Design for the 2022 calendar year, and at the conclusion of the 2022 program, we had a 90% goal start or partially completed rate, and a 78% full goal completion rate. 

The following article describes the method I took to develop, implement, and track the program, and helpful tips when developing a program for your organization. 

Start with your manager!

The first place to begin is with your manager, or the engineering department’s direct supervisor. Pitch the idea of implementing an engineering goal setting program with the goal of keeping your engineers accountable to the “big picture” goals or initiatives the company is looking forward to in the coming year.

Schedule a Kick-Off Meeting and Develop Materials 

The second step is to set a time and place where you can kick off the new program. I started with a 1-hour meeting where I introduced the program, but this upcoming year I have scheduled a 2-hour lunch-and-learn workshop, where we will review the goal program, workshop goals together for the 2023 year, and enjoy lunch. I know my team, and know food motivates, but do what you think is best for your audience. Giving away company swag is always a plus! 

Additionally, be prepared with materials to successfully launch your program. I developed a PowerPoint presentation (screenshot of the agenda below) that accomplished a few items; Defined what a goal is, the significance of goal setting, framework to developing goals (SMART method), how to track progress, and how to stay accountable. 

I also developed a handout that was instrumental in my team’s goal formation (screenshot of handout below). It was a fillable document that helps develop a SMART goal. This is also an effective way for the goal program administrator to collect the finished goals to start tracking progress towards completion. 

Develop goals 

Once you have kicked off the program, it’s now time for you and your team to draft, workshop and refine the goals. Whatever way you choose to aid your team in the development of the goals, it is important to focus their energy on attainable goals. Overly ambitious or unrealistic goals stifle progress and derail an engineer’s “kinetic energy”, not to say a stretch goal should be thrown out altogether though. A stretch goal is one where you would consider its completion a personal “stretch”, based on interests, resources, time constraints, etc. Finally, remember your own skillsets and available organization resources, and to stay consistent with your role. 

It also may be helpful to break goals into “targets”, which are individual tasks or milestones to accomplish your overall goal. Use targets to break-up your goals into smaller “bite-sized” pieces. 

Set Tracking/Check-In Meetings

The worst thing that can happen is you and your team spend all this time developing goals and then they are forgotten about until the next yearly goal setting meeting! That is why it is important to have check-in/goal tracking meetings throughout the year. This also helps with keeping people accountable for the actions they said they would take. 

The frequency of these meetings all depends on your type of team and business. I would host these at the end of every quarter and seemed to be well received (First week in April, July, September, last week in December before the holidays). Having each member of the team share the progress they have made towards their goals aloud is important, so the team can keep each other accountable. 

Stay Accountable

Keep yourself and your team accountable, including timelines and deadlines! I have a calendar reminder set for the end of every month as a “personal self-review”, along with the quarterly check in with the full team, as described above. 

Keeping detailed notes on the status of the goals and making a game plan on what should be achieved between check-in’s is important. There are a few tools that can be used for tracking, including but not limited to written documents/notes, Excel templates, and productivity software such as ClickUp and OfficeVibe. 

I also encourage my team to print out their goals list and tape it on a wall near their desk, so they are reminded of their goals every day, not just on check-in days. 

Build a Network of Support and Reflect 

Goals should guide you, not be an end-all-be-all. Goals should also be fluid; just because you set a goal in January does not mean it should be the same in December. They should evolve, change, or be abandoned as business needs change or as other strategic items arise throughout the year. 

Do not be afraid of failing, asking for help, or for resources. If you do fail; laugh, look internally, diagnose the problem(s) and try again. Finally, build a network that will help and support your goals! Share accomplishments with your co-workers and engage management.

As I always tell my team every morning, “It’s a great day to have a great day, let’s crush it!” Every day as an Engineering Manager, strive to bring new and exciting methods and principles to your team. I would love to hear your stories on how you have developed your engineering goal setting program, or the methods you currently implore. Email me at jbrino@rbcbearings.com.

About James Brino

James Brino is currently the Engineering Supervisor – Applications, Product & Process Development at PIC Design, a division of RBC Bearings, located in Middlebury, CT. Before assuming responsibility of new product and process development, James was a Senior Applications Engineer at PIC Design/RBC Bearings. Additionally, James is an Adjunct Professor at the University of Hartford Barney School of Business, teaching in the Management, Marketing and Entrepreneurial department. He graduated from the University of Hartford (West Hartford, Connecticut USA) with his MBA in May 2022. James has a Bachelor of Science in Mechanical Engineering from the University of Hartford.

www.pic-design.com/
www.linkedin.com/in/jamesbrino/ 

[This post is by Mohamed Sedky, ASEM Professional Member]

When it comes to engineering management there are many practices and strategies that have been developed through the years and it all starts with an organization’s strategy, mission, vision, procedures, systems and more. In other words, the focus tends to come from the top down. In this article I will focus on another perspective which is the lower block in the organization, specifically how engineering managers can change a company’s behavior and achieve operational excellence from the ground up.

While you cannot instantly change a system that is already established within your company, you can focus on particular areas that are related to you, your own department for example, and drive positive change. 

Here are five steps I follow to achieve smaller scale, but impactful optimization:

Define Clear Objectives

Following your company’s mission and vision, you should define clearly what the objective of the project is. Is it to increase profit, save cost, enhance safety, or optimize operations? There are a lot of objectives that are somehow related to each other, but you need to understand what language your company speaks. Most companies are concerned about safety, reliability, and cost. You need to figure out which strategy you will follow depending on your company’s situation. Will you be focused on enhancing reliability at whatever it costs, or will you be more oriented towards cost optimization? Maybe your company suffers from a lot of safety incidents,  driving the need to focus on operating more safely. Determine what your management is talking about and it will make it easier for you later.

System Thinking

Start writing down all the processes and operations you do on a daily basis, reports you prepare, and actions you take. Ask yourself this: How does this department operate? How does it think? Start building small blocks of things you do and listing the stakeholders, suppliers, or other departments you deal with. Write it all down and then try to record how much time each process takes.   You should be careful about all the steps you do in order to have an integrated map of all processes.

Work Breakdown Structure

Start dividing your operations into categories. For example, put all the procurement operations together, collect all reports in one section, and after that you can work individually to break things down to see all related processes then analyze each work group who are involved. How long does it take? What are the obstacles we face? How can we improve this process?

Optimization

After you are done building your map including all the processes of your department, now you should figure out the gaps you have. This could be done by asking the following questions:

• What problem (outcome) are we trying to solve (improve)? 

• Why is that what we want? Is it specific?

• Where and what are the process(es)? 

• Where does the process happen?

• What are the steps, inputs, and outputs at each step? Where do they come from and where do they go? 

• How good is the process? 

• What work are people doing? What does it cost to run? How efficient and effective is it? 

• What’s most important now? How are we doing it today? Who’s doing it? What is measured? What does and doesn’t work? How is it managed? 

Action plan

Take only one work group to start with. For example: the procurement cycle. Don’t go too far with gaps that need a management decision or investment, just start with the gaps you can manage following these steps:

• Make the process visible 

• Break it down into steps

• Create work standards where it matters

• Ensure the layout & flow can be seen to all involved in the process 

• Use visual management

• Make targets clear at each step

• Define what supervisors do

• Enable the right behaviors

• Make it happen

Following the above-mentioned steps is very simple compared to how it may look in reality.  Great success will come when you only start with one gap to solve.  Remember the cycle of strategic management to follow. Situational analysis is very important to measure your current situation and assess the gaps before you can build your strategy, apply it, then measure how it is working. Never forget continuous improvement!

About Mohamed Sedky

Mohamed Sedky is a young Professional Engineer with more than 5 years’ experience in Oil and Gas. Mohamed’s passion for engineering management lead him to joining ASEM as a Professional Member, earning his Certified Professional in Engineering Management (CPEM) and a master’s in engineering management. Mohamed’s current work focuses on digitalization and optimization in maintenance engineering projects.

By Neil Thompson

There’s a lot of talk about quiet quitting these days. People who aren’t going above and beyond – quiet quitters. If you as an engineering manager find out that the reason the quiet quitters who report to you are quiet quitting is because they’re unmotivated, they don’t feel like their contributions are valued, or they dislike your leadership style, perhaps a different approach is in order.

I’m a firm believer in leading the way people want to be led. If you’re so hell bent on leading your way, and the people don’t like that style of leadership and are just following you because you’re the leader, you may find yourself leading a bunch of quiet quitters.

While there are different approaches to leadership, since people prefer to be led in different ways, there are certain traits that everyone can appreciate.

The Importance of Clarity

I worked as a research associate at a startup company. A lot of lab work. Do experiment. Write down what happened. Repeat. My first boss was a new leader. He had never had a direct report. For a year, I thought I was doing well… until my performance review. It was then when I learned that he was deeply disappointed in my performance. I didn’t show initiative, he said. I didn’t know that he wanted me to show initiative, though. He never even mentioned it until that performance review. He wasn’t clear in what he wanted. Needless to say, I wasn’t all that inclined to follow him after that. To be clear is to be easy to perceive, understand, or interpret. A performance review is not the place to be caught off guard. If my boss was clear from the start, I would have known that showing initiative by suggesting experiments to run was something he wanted. Being clear with others makes it more likely that they’ll follow you.

The Importance of Listening

I had a boss at another company. Similar work. Do experiment. Write down what happened. Repeat. This boss would often ask for my thoughts on how to do something. I’d offer my thoughts. Then we’d do everything the way he wanted to do them all along. This was a regular occurrence. Eventually, I was not motivated to offer ideas, and I certainly wasn’t interested in following him. My boss didn’t listen. To listen means to take notice of and act on what someone says. This boss rarely acted on anything I said. To be an effective leader, you have to be a listener. No one knows everything. No one always has the best idea. Listening means that you are open to the thoughts of others. Listening to others also makes it more likely that they’ll follow you.

The Importance of Thoughtfulness

The CEO of a company I worked for was a cantankerous brute. I have no idea how he became CEO. No personality whatsoever. I had to do project status updates in front of him and the rest of the executives. Snapping at other executives was a frequent occurrence for him. “Well, that was dumb” was something he’d often say to them in regards to a decision they had made. For those other executives, I figured they must have been making a lot of money to accept being spoken to like children. The CEO was not thoughtful. To be thoughtful is to think of others and modify one’s conduct as to avoid hurt to others. It certainly wouldn’t surprise me if, at some point, the other executives tuned the CEO out, stopped following him, and simply did enough to keep their jobs. If you’re a leader, be mindful with your words. You don’t want to elicit an unnecessarily negative reaction. Being thoughtful of others makes it more likely that they’ll follow you.

Conclusion

There are many ways to lead. However, there are traits that we all can appreciate in our leaders.

Essentially, as a leader, when you talk, be clear and thoughtful. When others talk, listen.

If you implement these traits into your leadership style, you make it more likely that people will gladly follow you and less likely they become quiet quitters.

About Neil Thompson

Neil Thompson is the founder of Teach the Geek. An engineer, he works with technical professionals so they can present more effectively, especially in front of non-technical audiences. Learn more about Teach the Geek at teachthegeek.com.

By: James Brino, EIT

Are you a young professional newly promoted to an engineering management role or recently started a new job, and you are now responsible for a team of engineers? Do you have any idea how to manage a team of young and experienced technical minds? Are you struggling? Is Imposter Syndrome setting in? 

I was in this exact situation just a few months ago. I started at a manufacturer of precision gearing and mechanical components as an Applications Engineer in August 2021, with no direct reports, working independently with new customer and applications. I was really enjoying my workload and responsibilities. I was in business school at the time, with about a year left in my MBA studies, knowing I wanted to manage a team one day. Fast-forward to May 2022, I was asked to take over applications, new product development and process development for PIC Design, with three engineers reporting directly to me, all three weeks before I graduated with my MBA, and less than eight months with the organization!

You may have found yourself in a similar situation, trying desperately to stay afloat and not drown in the new role. I have spoken to many new engineering managers who have described the exact or similar situation, from all walks of life, industries, with and without an MBA. The three areas of weakness for new engineering managers that have been consistently brought up in conversation after conversation are: 1. People Management, 2. Conflict Resolution, 3. Establishing Credibility.

Challenges for New Managers

Of the three, conflict resolution may be the easiest to learn how to handle as there are many resources available, through ASEM (EMBoK 5th Edition is a great place to start!) as well as other sources, that teach techniques, tips and tools to manage conflicts, and how to mediate conflicts to a positive resolution.

Establishing credibility with your team is not as easily achieved, especially as a young engineering professional with no other management experience, or as a new member of an organization. One trick I have used to establish credibility with my team is to communicate my expectations at the start of every project making sure to present examples of work I have done previously in order to show the quality I expect out of the deliverables.  

People management is in a category all on its own. You can speak to seasoned engineering managers who say they still struggle with people management. Every company, department and team will have its own unique set of personalities and interpersonal conflicts. Try using a different leadership style with each member of your team. Unique people require unique approaches to leadership; there is no one size fits all leadership approach, as I learned the hard way!

As I always tell my team every morning, “It’s a great day to have a great day, let’s crush it”. Every day strive to bring a new and exciting possibility into your journey as an engineering manager. Many others are in the situation, so know that you are not alone in your struggles of transitioning into an engineering management role.

I would love to hear your stories on how you handled your transition into engineering management or would like a friendly face who is in the exact same situation you are in, jbrino@rbcbearings.com.

About James Brino

James Brino is currently the Engineering Supervisor – Applications, Product & Process Development at PIC Design, a division of RBC Bearings, located in Middlebury, CT. Before assuming responsibility of new product and process development, James was a Senior Applications Engineer at PIC Design/RBC Bearings. He graduated from the University of Hartford Barney School of Business (West Hartford, Connecticut USA) with his MBA in May 2022. James has a Bachelor of Science in Mechanical Engineering (May 2020) from the University of Hartford.

www.pic-design.com/

www.linkedin.com/in/jamesbrino/

 

by Annmarie Uliano

According to Gallup’s 2022 State of the Global Workplace Report, a mere 21% of employees are engaged at work and 33% of employees are thriving in their overall wellbeing as measured by their hope for the future, feeling about self, and connection to meaningful work. Some coined phrases to describe this are "living for the weekend," "watching the clock tick," and newly "quiet quitting."

What is quiet quitting? @zkchillin on TikTok's viral video captures the idea well: “You’re not outright quitting your job but you’re quitting the idea of going above and beyond. You’re still performing your duties but you’re no longer subscribing to the hustle culture mentality that work has to be your life. The reality is it’s not, and your worth as a person is not defined by your labor or productive output.” The idea of quiet quitting has become widely debated, sparked a great deal of important research, and opened an important public discussion about the nature of work.

My story

I had been exposed to the concept of quiet quitting pretty early on into my career. I joined a department where half the staff had turned over in the 3 months leading up to my joining (no, I didn’t know before I joined). Quiet quitting was pretty obvious with the few that remained. While me and the five others that joined around the same time were passionate, excited and ready to make an impact in the organization, I watched those veterans come late to work and watch Netflix way past their lunch break. Eventually the energized outperformed the “quiet quitters,” which led to a newly defined department with mission, vision, and shared values.

A few years later, the pandemic hit and while all industry was hit with too much work with not enough resources, healthcare got the hardest blow. An already overworked and understaffed workforce was pummelled. There was no money to reward staff for their hard work either. During one of the pandemic years, leadership told us they weren’t sure if we could even get a cost of living adjustment (luckily, we did). After a few months, I started to see “quiet quitting” get picked up by coworkers who once shared my energy to rebuild our department years ago. This time we were working from home, and it could be hidden much more easily. 

As my department dwindled due to burnout and new leadership took over, the ones that remained, including myself, were quietly quitting. One coworker got another job to make money, and worked both jobs side by side, mainly due to not getting fairly compensated or acknowledged. Another picked up a health and fitness hobby that seemed to run the schedule of their day. For me, I found my work/life balance became work/couch balance, and I no longer felt I was giving 100% in all of my tasks.

For some of us, the quiet quitting reaction is simply a response to anlack of respect from the organization, i.e. “quiet firing”. According to the Washington Post, employers avoid providing all but the bare legal minimum, possibly with the intention of getting unwanted employees to quit, denying raises for years, failing to supply resources while piling on demands, giving feedback designed to frustrate and confuse, or granting privileges to select workers based on vague, inconsistent performance standards. Those who don’t like it are welcome to leave. 

I realized perhaps, for me, a contributing factor to my quiet quitting was being an engineer in an organization where the role was misunderstood, working in a sea of medical professionals - people with a different set of credentials. I always felt I lacked good mentorship in analytics and had to work extra hard to find someone to fill that gap when I needed it.

A Possible Solution: Inclusive Leadership

I recently learned about inclusive leadership and want to propose it as a possible solution to combat the quiet quitting/firing trend. The Harvard Business Review defines inclusive leadership as leadership that assures that all team members feel they are treated respectfully and fairly, are valued and sense that they belong, and are confident and inspired. Another definition provided by Dr. Meghan Pollock from Engineer Inclusion is a set of leader behaviors that focus on facilitating group members feeling part of the group and retaining their sense of individuality while contributing to group processes and outcomes.

What I come to reflect on here is the effect of the leadership cascade on the members of my department. More inclusive leadership, as was demonstrated by my original boss in the original turnover of my department, is what was needed when things broke down over time. At various points in time, my department had interim leadership in place, and my organization went through a large merger and a pandemic. You can imagine that leadership at all levels could not keep up with steady and inclusive leadership with such a changing organization. 

For employees and managers alike, if you are struggling with engagement in your work, try learning more about inclusive leadership. The six key traits for inclusive leaders are depicted in the diagram below.

Feel free to comment and engage on how you think these characteristics may or may not help with the quiet quitting phenomenon.

About the Author

Annmarie Uliano is a Healthcare Systems Engineer in Boston, MA currently pursuing her CPEM certification. She is serving as ASEM Secretary and has loved being involved with ASEM since starting a student chapter during grad school at Northeastern University in 2016. Follow her on Linkedin or Twitter.

[This is a post by ASEM Fellow Donald Kennedy]

I have heard a recurring theme at ASEM conferences where academics talk about how to calculate earned value and the practitioners say they have never actually seen earned value calculated in the field. This is an article about a simple way to do earned value analysis that actually works! I have used this method in controlling a billion dollar project (and smaller ones), so it should work for you, too.

One question that Project Managers should try to answer is “are we above or below budget”. That is the question I am going to show how to answer here. The variables I mention in the title are those you find when you do a literature search on earned value, such as BCWP and ACWP. Every so often, I re-learn the meanings of these variables, but I find I quickly forget them through lack of actually ever using them. Earned value analysis determines which of the four permutations of over or under and schedule or budget reflects the status of your project (e.g. ahead of schedule and over budget). To figure out if you are ahead or behind schedule, you simply update the plan with the most current information and see what your new completion date is (that is all I will say about that topic here). For budget, you can simply do a similar exercise. The forecasted completion date is just the original plan updated to reflect the most current information. The forecasted cost at completion should also just be the original cost estimate updated with the new information. I have seen other project teams struggle with forecasts -- making it a focused task, perhaps done quarterly, going through an entire re-estimation of the entire project. This is not only time consuming, it results in getting information sporadically and too late to make any corrective changes.

Going into a project, you should organize your work breakdown structure (WBS) so that every piece of information you receive about cost (bids, quotes, invoices, or a payments, etc.) will be represented by an item in your budget / forecast. Accountants tend to group costs by asset type for depreciation and other long-term company purposes, so you probably cannot just rely on the standard coding practice. On the billion dollar project mentioned above, there ended up being over 30,000 transactions, so many people stated my method would be too difficult to use. However, in keeping with the Pareto principle, 4000 of these items represented 95% of the costs. Having a “Miscellaneous” line in my budget representing $50 million sounds rough to the inexperienced, but it proved quite manageable. Tracking 4000 items by sifting through the 30,000 transactions required a couple of hours a day, or about 10 hours a week. I will also note that due to the company’s ERP system set-up, the accounting data came in the form of a several inch thick hard copy printout. Items such as quotes and bids were sourced through phone calls to the responsible people. The point is this system is manageable if set up well to start.

So I will proceed with a demonstration using a simple children’s play area as an example. From the experience of others you hear that the type of play area you want to build will cost about $2200. Your estimating department provides the following estimate based on the scope you provided:

Now a common error that is well documented is that details provide a confidence that may not be well-founded. The problem comes from listing all the knowns, and there will be unknowns. The difference between the sum of knowns and the typical cost from experience can be called ‘contingency.’ This should then establish the budget. The tool you can use to manage your project will look like this:

In order to properly manage a project, you need to know the most accurate information. If you simply add a buffer to each item “just in case” or to avoid blame for being wrong, this distortion impedes understanding. Showing the uncertainty as contingency helps you remember it is there for that reason. Changing numbers to fool others (such as your management) comes with the risk of ending up fooling yourself. Let’s say you inflate each line to allow for some contingency on each item. Halfway through the project, your spreadsheet may look like this:

So far, every item has come in under budget. Things appear to be trending well and you are starting to feel comfortable. You may forget that you padded each line with a buffer, and the real costs are actually all coming in higher than you expected. Using my suggested format with an allowance for unknowns, the snapshot for the same real costs now becomes:

The false comfort from before now becomes concern as everything is clearly trending higher than you expected. Let’s say a new development is that you realize the wood you purchased was for the quantity required, forgetting that 20 feet of board in two 10ft pieces cannot be cut to make three 6ft lengths, even though the total required is 18ft (2ft less than the amount ordered). The order for the additional wood is $100. As well, you learn that you need to light the area and have the design stamped by a professional engineer under your jurisdiction’s local regulations. These unplanned items cost $327 total. You also get a rough estimate from a contractor engaged to provide the labor for $500. Based on past experience with this contractor, your best guess is that the final cost for the work will be 20% more than the rough guess. The snapshot of your cost performance now looks like this:

Every time you get new information, you enter it into the spreadsheet and you get a new forecast. At the point shown above, you now see that you have spent 1350/2200 = 61% of the budget, you have committed 4% more than the budget and you are forecasting an 11% overrun. What you actually report at any time within your organization or to other stakeholders is up to your discretion as the project manager, but at least you know yourself where you sit.

So just to lay out my rules explicitly:

1) The budget should be expressed as a detailed estimate. If this is not the first project of this type you are doing, the spreadsheets from the previous jobs can become the basis for this detailed estimate. Changes in quantity can be accommodated.

2) The budget for each item should be what you expect the costs to be. Padding the numbers misleads you on your original expectations.

3) The coding for the costs as they come in should parallel as much as feasible the structure of the estimate.

4) The difference between the approved budget and the total of the detailed estimate is your allowance for unknowns, or contingency. If the budget is lower, then you are in the situation often joked about by project managers: “I haven’t even started yet and I am already over budget!”

5) A common request I have heard from the team is that the contingency must be higher to cover inflation. If you know the costs are going to be higher than last time, then the budget for those items should be increased. If you are pretty sure an unknown is going to happen, then it is not an unknown by definition.

6) The forecast is the budget updated with the latest information.

7) The forecast for an item starts as its budget.

8) When new information comes in, the forecast for that item should reflect this new information. If a line item is tendered as a contract, the forecast can be changed at the time the bids are opened. The bid you expect to be the winner can be used as a basis for the new forecast amount (perhaps with some additional for expected cost extras on the contracted price).

Using this method provides the answer to where you sit on the cost performance of the project. Even if it does not look like Earned Value, that is what it really is. The forecast starts out as the budgeted amount and then it is replaced with the actual amount. The amount of work “earned” is the budget amount that is replaced by the actual cost.

[This post is by ASEM Fellow Donald Kennedy]

A common critique of my articles is that I often do not have a recipe to offer to avoid the pitfalls of events I discuss. Management is complex and therefore explicit instructions tend to have other pitfalls in execution as severe as the situation they intend to fix. Most often my point is to simply be aware of how things really work. Two people working physically close may have very divergent interpretations of the status of the processes in their organization. The one with a more accurate view will be the one that will consistently make better decisions.

I am going to provide an example of what I call “faux automation” to show how I intentionally provided false information to reach completion in the most effective route. I did not believe it was my role to inform the management above me that things are not always the way they believe they are. To stop processes and work through things would not add value to the current endeavour.

I was working on one of my $100 million projects. The chief inspector would provide progress from the contractor in terms of percent complete for the various elements of the work breakdown structure. These values determined the amount of the progress payment for the contractor on a lump sum contract. The reported progress had zero impact on the total money the contractor would receive at the end, it only set the amount of the partial payment for that period. The inspector derived the percentage complete basically by holding up a thumb and looking around the construction site. “Uhm, piping is 37% done.” The inspector would write the numbers on a piece of paper, scan it, and email it to the contracts clerk. The clerk would type the numbers into a spreadsheet and inform the contractor how much they could invoice that month. The VP learned of this method and we discussed it in a management meeting. I volunteered to automate the system.

Four months later, the project was completed. The VP asked the clerk how the automating of the invoicing went. The clerk said it worked perfectly as the step of manually transferring the inspector’s numbers was eliminated. Everyone was satisfied and the initiative was recorded in the list of items in the Continuous Improvement program that increased efficiency. At the bar on Friday afternoon, a coworker asked me how hard it was to automate the system. I said it looked like it would be very tough initially and would take around 40 hours to develop and debug a process. But I came up with a solution that took only 15 minutes of my time. Since there were only 4 more invoices to be processed, I just typed the numbers in, instead of the clerk. Problem solved!

About the author

Donald Kennedy is a Fellow of the ASEM. He is the author of the ebook “Improving Your Life at Work” available on Amazon. After working with over 50 companies, Donald has moved out of the Oil and Gas Industry with its boom and bust cycles and started a new phase in agricultural machinery manufacturing.

By Gene Dixon, MBA, PhD, CPEM, FASEM, Executive Director of ASEM

About the Book

Author: Paul Rulkens
Title: How Successful Engineers Become Great Business Leaders
Publisher: Business Expert Express, 2018
ISBN-13:978-1-94784-368-4

Introduction

Spoiler alert: According to Rulkins, engineers can become organizational leaders. Even without an MBA. 

Now that that is settled, why should you read the book?  You should read the book because, like the management methods summaries of Blanchard and Johnson’s One Minute Manager, this book provides high level overviews of methods that the author has experienced and then tuned for engineers.  It is a well-written treatise offering insights for engineers in a path towards organizational leadership. Not to be naïve, Rulkens notes there is an element of opportunity meeting preparation, or what we all know as luck, involved.  Rulkens propositions that engineers are endowed with three basic strengths, or talents, that enables them to succeed at the highest levels of the organization: reality-based thinking, process design, and accelerated thinking.  In discussing the uses of these strengths, he offers monographs of methods accompanied by 30 challenging questions.  The questions, if taken seriously, will direct the reader to look inwardly while addressing and overcoming organizational challenges. This may seem oversimplified for those who want textbook level details to becoming a leader but the proof is in application. And, Rulkens intersperses his observations with vignettes and interviews that make his points clear.  

The book is an easy read. Figure 1-2 hours depending on the reader’s comprehension speed (remember that accelerated learning strength?).  Still there is plenty of mental and practical process (re)design within the 148 pages to comprehend and apply. I benefitted from a second read, however. Eventually, the engineer turned leader must stop the (book) analysis and get on with decision-making and goal achievement.  Let me see if I can turn this review into a tease that will entice you to explore Rulkens’ work.  

The Engineer's Superpowers

Rulkens describes the engineer’s superpowers - he calls them super-talents-like this: 

• Reality-based thinking is the ability to make decisions driven by data, the ability to clarify assumptions, and the ability to overcome systematic thinking bias such as self-selecting bias. 

• Process design is the application of process thinking to business challenges and systematic behavior testing to get different results using different processes. Another way to think about this is to ask, “What should not work, but is working anyway?”

• Accelerated learning is defined by the speed, frequency and size/depth of the feedback and only happens when feedback from actions and experiments is fast, frequent, and significant. 

According to Rulkens, it is possible for engineers to become great leaders by applying those superpowers in addressing the usual business challenges such as overcoming obstacles, crossing the valley of (innovation/project/etc.) death, strategic (re)alignment, avoiding stupid mistakes, eliminating contrary habits, and building the client network. 

I recommend two chapters for a careful read, Effective Leadership Behaviors (5), and Goal-Achieving Blueprint (9).  Thankfully, Rulkens stays away from the normal self-help banter with his personal insights in both chapters. 

Critical Behaviors

When it comes to leadership behaviors, Rulkens crisply guides the reader through germane topics like boosting signal/decreasing noise, applying Poka Yoke, and putting the dead rat on the table.  You’ll appreciate those more when you read the chapter.  On a more serious note, Rulkens discusses 12 behavioral distinctions for attaining higher performance: 

• Playing to Win versus Playing Not to Lose

• Demonstrating Ownership versus Victimhood

• Acting like a Student versus a Follower

• Moving from Symbolism to Substance 

• Being Committed and not just Involved

• Understanding Serving as opposed to Pleasing

• Focusing on Results over Process

• Adding Value verses Taking Up Space

• Speaking with Clarity and not Code

• Honoring Your Word not just Giving your Word

• Acting on evidence not Anecdotes

• Building a Legacy verses Leaving a Trail

With each behavioral distinction, Rulkens provides a simple question or two that challenges the reader to think deeply about the behavioral distinction and how each distinction is important to leadership performance. 

Goal Achievement

Rulkens’ blueprint for goal-achievement goes beyond usual plug-and-chug formulary with the overarching thought that for the organization, goal achievement is strategy execution, i.e., the two terms are synonymous and strategy execution is owned by senior leaders. From Rulkens’ experience, the way to execute strategy is to “…focus on the spear tip of a few initiatives”.  He dissects strategy execution into simplicity and speed.  Simplicity provides true north consistency.  Speed is the energizing sense of urgency and the “…driving force for agility”.  Rulkens recognizes the work of Drucker in that, “…executives should focus on only one strategic goal”, and all other strategic objectives are subordinate to that “…major definite purpose”.

Rulkens ties the engineer’s superpowers to achieving the one organizational strategic goal.  For him:

• Reality-based thinking enables simplicity in decision making related to achieving the one strategic goal. 

• Process design enables systematically building organizational behaviors that support achieving the one strategic goal

• Accelerated learning provides a cadence to move the organization towards compound improvement and keeps the one strategic goal in front of executives and every member of the organization. 

Conclusion

If you are nautical minded, you can think of this as what Rulkens labels trim tab leadership.  When engineers apply their superpowers and the three building blocks of goal achieving-clarity, focus, and execution-they are trimming the organizational rudder. Finally, Rulkens calls attention to the clarion challenge for all engineering managers, to wit: your minimum effective behavior is the maximum effective behavior you should expect from others.  

Give the book a read. Let’s get those superpowers working for you and for ASEM! Overachievers welcome here.