Engineering Audits

 Audit: an official examination and verification of accounts and records, especially of financial accounts; a report or statement reflecting an audit. [Note the narrowness of this definition (drawn from an accounting book) in that the "examination and verification" is confined to "accounts and records". This definition excludes the auditor and process from entering the physical reality of the operation and organization to determine just what is there.]

Auditing: the process of examining, verifying, and evaluating records, physical data, inventory, and operations in order to show financial or operational conditions and provide a basis for an opinion concerning the reliability of records and of the total operation and organization.  Historically, audits are used to determine the financial condition of monetary institutions and operations. Today, auditing has been expanded, in scope and depth, to include investigations of the efficiency and efficacy of governmental, quality assurance, industrial, and health service operations. The auditing methods include surveying and interviewing employees, customers, vendors, and others with business relations to the audited organization. Many skills besides those of accounting are used and improvements are often proposed in the audit report.

Engineering audits are basically industrial engineering operations and fall under the area usually reserved for Methods and Operations Analysis and Work Measurement (Time & Motion Study). Whether the auditor uses a stop watch, sun dial, or calendar, the principles are the same:  (1) Observe the operation;  (2) Measure it; (3) Devise improvements.

Waste reduction    Waste of resources has two aspects: (1) Doing something, which does not need to be done at all; and (2) Within a required, necessary operation, a job poorly done, often over-staffed. The waste which occurs in the necessary operation is essentially the first aspect (1), an unnecessary activity.

 

Anecdotes

In the education business:  A technical college offered a Methods and Operations Analysis course in the evening during the spring semester. The entire industrial engineering curriculum was offered in the evening division and the Methods course was appropriately scheduled for the fall semester. There were barely enough students to fill one class, yet it took fifteen years (1969 -1984) of arguing to drop the spring semester class to finally get it cancelled. (That happened when a single student enrolled.)  Savings per year would have been $2,500.00, on average; totaling $37,500.

Rearranging the entire curriculum of engineering courses (for an I.E. program) would have effected a 40% saving in instructional cost. This proposal was ignored by the chief department administrator for ten years (1980 - 1991). Savings per year would have been $28,000.00 and would have totaled $336,000 for the twelve year period.

In municipal government: Two cases, observed by this writer, where sidewalks were replaced by identical pieces of concrete. In both cases, the condition of the new material was exactly the same as the old. Two squares were laid in 1925 and were in perfect condition and were dead-even with adjacent sidewalk squares, but they were replaced. A street corner square was above an adjacent square by 0.5 inches; the replacement was above the adjacent square by ... 0.5 inches.

In the military: The scheduled process of mustering out of the service takes about ten calendar days and includes a final medical exam, payroll review and unused leave compensation, turning field equipment to supply, exit interview with the commanding officer (a re-enlistment pitch), checking in with the base library for the return of books. The actual time required for all of this is about three days, tops.

In health services: The use of protocol sheets to question patients, by para-professionals rather than by doctors, has proven more effective and efficient than just seeing medical doctor.

In the advertising and public relations games: Although advertising effectiveness research is well-known among academicians, it is little used in practice.  Quoting the deathless words of John Wanamaker, "Half of my advertising dollar is wasted. The trouble is that I don't know which half." suggests that we're not sure if our money is well spent. Quite true!  A recent article (April 11, 2002) in the Milwaukee Journal Sentinel reports that the Milwaukee Metropolitan Sewerage District (MMSD) was planning on adding $3 million to its in-place $5.6 million public relations budget. The district serves 1.2 million persons (their statistics) and the proposed budget (with the addition) works out to $7.17 per person in the district . Is MMSD treating sewerage or moving words?

In industry: A heavy manufacturing corporation running three-shift operations, five days a week, had a costly absenteeism problem on the Friday night shift. Workers were paid on Friday morning and some of them spent some time in local bars early that day. Ninety-eight percent of the Friday night operations had crucially absent workers ... that's right, only once in a year did the shift have a full crew: the evening that the Christmas hams were doled out. The problem could have been solved easily by noting that other, local plants, which ran 3rd shifts operated on Sunday nights through Thursday nights! [Note: This is an institutional rules and regulations aspect of productivity, part of the management triad.]

The New Model Industrial Engineering Associate Degree Curriculum The latest and most comprehensive curriculum for the two-year degree in industrial engineering (Technician): Explanations, Program layout, Course descriptions.