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General discussion of the relationship between the basic skills of the economists and behavioral scientists in regard to management decisions. The purpose of the paper is to encourage technical management to realize that both technical and economic success in producing a product competitively depend upon the effective utilization of human resources through proper motivation. It is shown that this is only possible when personal goals and company goals are integrated. It is suggested that a basic responsibility of management is to create conditions such that members of the organization can achieve their own goals best by directing their efforts toward the success of the enterprise.
Description of an approach to program control oriented toward systems management. The following topics are discussed: total program control; systems management; program cost control; PERT network activity pricing; expenditure rate curves in cost planning and control; frequency of cost reporting; technical performance and program schedules; and project status reporting.
Review of some DOD policies and programs relevant to management decisions regarding resources applied and organizational plans devised to satisfy needs for space-age accuracy. The comments pertain primarily to industrial organizations doing business with DOD. Specific DOD policies and programs reflecting the costeffectiveness system of analysis are discussed. It is stated that it seems evident that incentive-type contracting offers sizable opportunities for cost-oriented engineers and scientists to bring their activities into the main stream of space progress. The widespread application of cost-effectiveness analytical techniques, and the strong trend toward incentive-type contracting, have set the stage for closer collaboration between the business and the technical organizational elements within both industry and government. M. M.
Review of the progress in aeronautical and aerospace spares management which has occurred from the mid 1940's through 1963. Areas covered include commercial airlines, Army, Navy, Air Force and NASA. It includes some of the past history of spares management and improvements gained. In each of the above areas, the range of spares management from provisioning, ordering, inventory control and distribution, through packaging and handling, is covered. It is noted that progress has been considerable over the past 20 years, and it is anticipated that more efficient spares management is imminent as refinements and improvements continue.
A64-25355 THE LEARNING CURVE - A CASE HISTORY IN ITS APPLICATION. Julian L. Kottler (Avco Corp., Aerospace uctures W., Nashville, Tenn.). Journal of Industrial Engineering, vol. 15, July-Aug. 1964, p. 176180. 5 refs.
Description with an applied case of the use of the learningcurve principle to forecast and control direct labor cost. The learning-curve theory is said to propose that as the total quantity of units doubles, the hours/unit (which reflect cost) decline at some constant percentage. Programs of motion and time study were reportedly used to establish standard methods and work crews. An analysis of direct labor cost and performance was made. Tables are presented giving the development of plot points for the direct labor learning curve, planned cost development, and actual cost vs planned cost.
Comprehensive study of the manner in which the Air Force is improving its spares management program through the use of highspeed electronic data processing equipment, improving its personnel skill level through training and higher education, and by instituting a series of management control systems to insure reliability of data output. The accomplishments of Air Force spares management resulting from critical examination of the requirements for each of the one million spare parts in the inventory are dealt with. A marked reduction in the dollars needed to support the combat capability of the Air Force is shown.
Discussion of the qualitative and quantitative aspects of systems analysis in terms of a step-by-step organization of the analysis effort. Concepts basic to the logical accomplishment of systems analysis in industrial engineering are examined in terms of external requirements, sectionalization, and internal systemization. Two examples are shown of conceptual tools believed to be most impor tant: the design flow chart and the system network diagram. The systems analysis concepts advanced are believed to be applicable not only to the aerospace systems given as examples but also to other complex systems encountered in industrial engineering.
Presentation of the ideas that management of an ICBM or space system must be preplanned and management by reaction has no place in such systems. Martin-Denver's experience with developing Titan 2 use plans is described, and the value of this preplanning is analyzed and compared with conventional methods of management by reaction. The advantages of use plans for future programs are discussed in terms of the following three questions: (1) when in the program should use plans appear, and why, (2) how should use plans be employed during system development, and (3) what should be the final disposition of use plans.
Discussion of the management control system used at the Sperry Gyroscope Company. Product Administration and Contract Control (PACC) is an integrated data processing system designed to provide management with the necessary tools for control of overall program operations. To achieve the objective of improved management control, PACC is designed to include both information and control subsystems as well as operating subsystems, for complete control of company activities.
Description of the six categories, for various types of development, implemented by Northrop Ventura as part of their internal management control, similar to those in the Department of Defense. This implementation required: (1) that the DOD development categories be expanded and interpreted in terms of Northrop Ventura's product interests; (2) that levels of appropriate effort within each of the development categories be defined for all functions involved in the development process.
These latter levels are said to constitute what is called "effort classification." Effort classification has been credited with reducing the time required to prepare and negotiate proposals, simplifying program management, and achieving product maturity.
Discussion of the significance of the Department of Defense Project (or Program) Definition Phase (PDP), required prior to the initiation of major programs. It is stated that the introduction of project definition requirements in the aerospace industry will require major and, in many cases, drastic changes in management philosophies and procedures. Pre-proposal efforts, which previous ly required predominantly engineering and marketing efforts, will now require not only considerably increased effort in these areas, but, in addition, increased effort by engineering, production, and other segments of any given organization. It is noted that the current trend toward requiring a fixed price incentive proposal as part of PDP will require a tremendous amount of additional overheadtype effort. The requirement for stated performance incentive goals will, inevitably, lead to more conservative design and engineering during the project definition phase.
Presentation of an approach to program control which is oriented to systems management. Aspects of the problem considered include total program control, systems management, program control, introduction to PERT network activity pricing. PERT activity pricing and analysis in detail, use of expenditure rate curves in cost planning and control, frequency of cost reporting, technical performance and program schedules, and project status reporting.
Brief review of the major facets and principal premises of long-range planning activities as they are currently practiced at Rocketdyne. The topics considered include the two basic steps in long-range planning, evaluation of external influences, statement and re-examination of objectives, identification of new opportunities in rocket propulsion, major future programs and their selection, major areas of research and development, market and sales predic tion, facilities plan, skills and personnel, dollar resources, the planning organization, and key premises. Figures show charts of the Rocket Division's total national market by product, national market, and product sales.
Discussion of the cost estimation problem studied in an ARPAsponsored project which was initiated to develop improved management techniques for computer program ning in command and control systems. Some of the underlying causes of the cost estimation problem are discussed and about fifty factors that appear to contribute to cost are identified. Data concerning the effects of some of the cost factors are presented. Finally, some suggestions for further work are offered.
Description of a system for the evaluation of program risks. The system evaluates the risk level associated with each hardware end-item for each of seven "resource" or "external" limitations factors, as assessed by the responsible engineer; and the extent to which methods and practices are being adhered to in 21 key area as assessed by the responsible individual with the aid of a checklis identifying the low-risk way of doing the job. A four-degree riskcategorization system is used. Substantiations are required that define the work needed to decrease risk and the cost of doing such work. Appraisals are made periodically throughout the program. It is stated that the data display with substantiation gives a greater depth of understanding of the program than formerly available, anc that it provides a new basis for management action.
Description of a method of assessment. The rating system indicates to the plant manager how each division is performing its value engineering responsibility, provides incentive for the division manager and his value engineers to improve their rating, and provides the manager and his value engineers with a method of determining ways to improve their program. From these benefits, the rating system is considered to provide a valuable means for gradually strengthening program efforts.
Discussion of plans for a real-time management information system. A real-time management information system monitors the physical environment but exerts only indirect control by the production of management type reports or displays. The general instrumentation of simplex, duplex, master/slave, shared-file, and multiprocessing systems is briefly surveyed. A real-time system is used for obtaining planning, control, and operating reports and can also be used to develop by-product data for the production of new criteria for performance evaluation.
Definition of basic areas requiring a means of measuring the effectiveness of value engineering. It is considered that there is a need for management to define more clearly the objectives of its reporting requirements and that management should consider placing more emphasis on value-engineering effectiveness in the areas of education and consultations. This can be brought about by scientifically examining the value-engineering job content with a management tool such as job analysis. Once the job content has been established, it is possible to measure the effectiveness of value engineering in the basic areas of responsibility.
A64-14704 PROGRAM MANAGEMENT TECHNIQUES AT MARTIN ORLANDO. Leander Schaidt (Martin Marietta Corp., Martin Co., Air-to-Surface Missile Systems, Orlando, Fla.). (Institute of Electrical and Electronics Engineers, National Winter Convention on Military Electronics, Los Angeles, Calif., Jan. 31, 1963.) IEEE Transactions on Engineering Management, vol. EM-10, Sept. 1963, p. 124-137.
Description of the concepts and systems of program management and project control used at Martin-Orlando. The functions of each level of management are described. A project master plan is presented which summarizes major items of work and delivery status. The plan is color-coded to indicate firm business under control, carry on business expected against existing contracts, and potential business expected as a result of research and development and sales, Also presented is a missile flow plan which shows the sequence of completion of subassemblies and components, process flow through final assembly, and the required scheduling and time spans. Inputoutput control curves are discussed.
Review of steps taken at the RCA Missile and Surface Radar Division to increase the scope of value engineering responsibility and to improve the effectiveness with which value engineering recommendations are implemented. Comment is made on the role of value engineering in the preparation of new proposals. A problem in spares procurement is treated which is considered to show advances over the MIL specification governing spares provisioning. Value engineering is also concerned with application of microelectronics to heavy ground -based radar products, and a typical case is examined in some detail. The division of work in an office between scientific and engineering activities and administrative value engineering is discussed.
Brief review of the aspects of program phasing which dictate the need for total configuration control, in terms of design and data interface and concurrency concept considerations. Basic elements and organizations of a configuration control system are described and integrated with program, project, and functional department management. The importance of acquisition, verification, compilation, and integration of data with timely release for shared use is emphasized. Stress is also placed on the development and preservation of evolution traceability, and the cross-sensitivity of change effects among design, data, schedules, and resources.
A64-18117 GOOD MANAGEMENT INSURES PROGRESS. David F. Barber and Anthony Coppola (USAF, Rome Air Development Center, Griffiss AFB, N.M.). (International Conference and Exhibit on Aerospace ElectroTechnology, Phoenix, Ariz., Apr. 20-23, 1964.) IEEE Transactions on Aerospace, vol. AS-2, Apr. 1964, p. 345 349.
Discussion of the role of management in the achievement of reliability. Considered are the management structure and management tools, and certain recommendations toward the improvement of reliability through better management are made.
Description of a total information system designed to provide a company management with specific elements of information required for planning, execution, evaluation, and control of the total business - in this case, helicopters.
Brief review of some industrial applications of computers. The use of computers for aerospace system simulation, such as the Marshall Space Flight Center's computer simulation of Saturn rockets, and data retrieval are noted, as is their use in operational systems for industrial applications. An example of such an application is the Inventory Management Program and Control Techniques (IMPACT), which is made up of three basic functions stored within the computer: ordering, forecasting and reviewing.
for maintaining effective scientific, technical, and managerial skills within the military services for the development of new systems. Two of the Army's newest and most complex programs
the Zeus missile program and the M-60 tank program - are described in detail. The differences between these two programs are contrasted in terms of their management approaches. The Zeus program makes use of private industry for technical direction and manage ment, whereas the tank program is managed in-house.
Detailed discussion of the overall view of major concepts involved in the engineering and management of man-made systems and man/machine systems, treating systems technology as it exists and interpreting the probable trends and implied conclusions of current practice. The text is designed for both management and the public, and also furnishes a general survey of the subject for the scientific generalist and the specialist. Specifically covered are (a) basic system concepts, including subsystems and components, and selection and effectiveness criteria; (b) special problem areas, including human subsystems; (c) design and analysis; (d) the operational approach; and (e) a systems technology forecast for the next era. Technical detail is, for the most part, confined to the appendices which constitute the bulk of the book, and are completely independent, providing supportive and illustrative material for the text. Included in the appendices are (1) a precise definition of systems; (2) the notion of generalized logical design; (3) the partial design of a hypothetical weapons system; (4) the systems matrix approach; (5) a mathematical model of a conventional digital integrator; (6) a discussion of generalized logic; 17) preliminary consideration of an army surveillance system; (8) remarks on low-level redundancy; (9) elements of a behavioral theory of static decisions; (10) the relativistic Doppler effect, a new approach to space navigation; (11) limitations of contemporary terrestrial Doppler navigation radars; (12) the tunnel display concept; and (13) application of electromyographic techniques in the integration of man/machine systems.
Discussion of the recent reorganization of the Army as a result of which the Army Materiel Command is established to integrate the materiel functions of the Army. A strong emphasis is placed upon the use of vertical project management, and it is shown how this concept is being utilized in the AMC. It is suggested that the discussion of the functions. roles, and organizational relationships in this new type of organization should be meaningful in advanced technology industries. The conflict between functional and project management is outlined and ways for ameliorating it are suggested. The idea of the "red line" - a subordinate communicating directly with the top level in the organization while bypassing intermediate superiors - is presented, and it is indicated that it is a departure from the traditional military concept of single chain of command.
A63-16590 THE ANATOMY OF PROGRAM MANAGEMENT. J. B. Medaris. (National Advanced - Technology Management Conference, Proceedings, Seattle, Wash., Sept. 4-7, 1962.) IN: Science, Technology, and Management. New York, McGrawHill Book Co., Inc., 1963, p. 112-128.
Analysis of the problems of government-industry program management based on such projects as the Redstone, the Jupiter IRBM, the Explorer and Juno series, the Pershing missile, and the Saturn space vehicle. The uncertainty in decision making and the conflicts existing during the late 1940's and early 1950's regarding the national rocket and missile program are pointed out.
The importance of clearly defining the problems and objectives of a program is stressed, indicating that this is one of the most important managerial functions in establishing a new program on the right basis. However, the conflict of values which often permeates a program is spotlighted precisely and clearly. It is indicated that the built-in conflicts among the customer, the national financial authority, the final user of the product, the scientists and designers, the production-oriented people, and business managers are to be expected in advanced-technology programs. The establishment of dual approaches in meeting new scientific and technical problems is proposed. Finally, valuable suggestions for handling some of the specific problems involved in actually managing a program are provided. The vital importance of maintaining active communication and coordination between the various groups within the project is stressed, and the role of project management in this activity is outlined.
Description of the theoretical development and actual implementation within a divisional organization of a comprehensive design review program. Successful application to the Orbiting Geophysical Observatory program is reported. The initial success of the pilot operation suggests a company-wide application.
Discussion of the importance of the Army's in-house capabilities in meeting technological requirements. A strong case is made
A treatment of the methodology of systems engineering is presented to increase awareness and understanding of the process, and to sharpen definitions and approaches to the principal recurring problems, such as definition, goal setting, systems synthesis and analysis, and choosing among alternate systems. Intended for teachers and students of systems engineering, creative engineering, design, operations research, management science, and related fields, the material is presented in four groups: (1) description and analysis of the overall process, with identification and discussion of recurring problems; (2) problem definition and development of systems requirements; (3) decision-making, emphasizing problems of setting objectives, and designing effective value systems; and (4) approaches and tools useful in systems synthesis and analysis. Terms that are considered necessary for the logical development of systems engineering are listed in the index.
Survey of advances in inventory management, with emphasis on problem solving and specific applications. The book was developed from the material in a graduate course taught by the author at Case Institute of Technology. Areas discussed include single station (static deterministic models, static probabilistic models, and dynamic models), parallel stations, and series of stations.
before it starts. This has extended the application of total value concepts throughout all project activities and broadened their scope. Total value concepts are discussed and applied to various aspects of system effectiveness. The effects of configuration, reliability, and system availability upon overall costs are considered, and cost vs performance optimization curves are shown. Practical measures of service life are calculated. Break-even curves relating acquisition and operational costs are shown. A decision matrix method for assessing system value is included. A case study graphically showing the effects of value considerations on a typical radar antenna tower is contained in the paper.
Description of a practical approach to the control of fiscal and technical progress for multiple unrelated engineering projects. The technique incorporates six basic steps: (1) definition of the goals or the project aim; (2) preparation of the engineering estimate; (3) preparation of the project plan; (4) periodic review and evaluation of each project; (5) correlation and coordination of indi vidual projects into the overall engineering operation; and (6) presentation to corporate management,
Presentation of a procedure for determining the final fee in Cost-Plus-Incentive-Fee (CPIF) contracts. As a basic part of the plan, it is assumed that the contractor is willing to take a risk of having essentially all of its fee eliminated when contract performance is poor, and, in return, be awarded a substantial increase in fee over the negotiated target when contract performance is superior. It is noted that the Armed Services Procurement Regulations (ASPR) limit the final fee to a maximum of 15%. It is shown that between these two limits, the contract performance is determined by four incentive factors: cost incentive, schedule incentive (delivery of hardware and documents), product performance incentive, and reliability incentive. In conclusion, four advantages of CPIF contracts are presented: (1) the contractor will have the added incentive to secure the highest caliber management; (2) the cost of the contractor's operations to fulfill the contract will generally go down; (3) the customer and the contractor share the risks, since the contractor could lose a large portion of his target fee for inferior results; and (4) the reliability requirements become meaning ful because they can influence the final fee determination. M. L.
M2 CONTRACT MANAGEMENT
The paper addresses the alleged incompatibility between the current government procurement practices and the trend toward tighter management control techniques in dealing with defense and space contractors. It attempts to show that the fundamental problem
s not incompatibility between greater contractor risk and control, but how government has applied the new control techniques. It describes several actions the government is undertaking to carry out future development and implementation of management control procedures in a more orderly manner and in a way that will reduce the impact on industry. It concludes that considerable opportunity exists for industry to improve its participation in a partnership with government that will benefit both parties.
Discussion of the concept of program management in today's aerospace business in relation to the requirement for an effective management to cope with a complex management task involving multiple interfaces of business and technical disciplines. Some organizational precepts are presented as being fundamental to achieving an effective management system in a multi-program company environment of major aerospace programs. The program management system evolved for the development of the DC-9 Jet Transport is described to illustrate the implementation of the concept. In this program, each program manager has under his direct control the function of contract administration, subcontract administration, work authorization, budget authorization, cost control, and the measurement and control of program progress.
For large military research and development projects, Contract Definition type contracts are meeting the cost-effectiveness challenge by an intensive study of the total value considerations in a project