What we know, and mostly don’t know about engineering practices

This is the script for my REES-AAEE-2021 Keynote. The video is here, and the powerpoint slides are available on request if you would like to use them for education purposes.

For a sustainable future, we need large productivity improvements. Engineers are critical contributors, but we need deeper understandings of engineering practices and how education influences them to make the necessary improvements. Without this, education reform arguments are fragile at best.

Read the Script of the presentation (30 mins)

Productivity isn’t everything, but…

No wonder Trump can easily still command rustbelt supporters. Stagnation in the US manufacturing industry is killing prospects for wage rises. Bureau of Labor Statistics data released two weeks ago shows that while productivity increased by about 3% annually from the 1980s till 2007, annual growth since has been only 0.4%. Most of that, and more, is needed for sustainability improvements like changing to clean energy.

Labor productivity depends on engineered tools, machines and materials, so engineers are the key people to restart productivity growth. While economics and labor saving solutions were the priority for engineers in the 1950s, as evidenced by the ASEE Grinter report, now that seems to have been forgotten. Our research is revealing that today’s engineers have limited understanding on how to generate commercial value.

Students need to learn the fundamental purpose of engineering. Distilled from our research on hundreds of engineers in several countries, that purpose is to enable people to be more productive.

“Engineers are people with technical knowledge and foresight who conceive, plan and organise delivery, operation and sustainment of artificial objects, processes and systems. These enable productivity improvements so people can do more with less effort, time, materials, energy, uncertainty, health risk and environmental disturbances.”

Sustainability depends on similar improvements.

As Paul Krugman wrote more than 30 years ago,

“Productivity isn’t everything, but in the long run it is almost everything. A country’s ability to improve its standard of living over time depends almost entirely on its ability to raise its output per worker.”

Economists are hoping that the digital economy will restore productivity growth. It might. But in a world where information supply is exponentially increasing, its value must be exponentially decreasing.

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Trump needs engineers who understand value

Americans have voted, and most of us were surprised.

I just watched a CNN interview with a former factory worker who voted for Trump. “We need lots of small factories with 200-300 people making things, employing Americans.”

Trump can’t deliver that.

Only engineers can make that happen, engineers who know how to create sufficient value to attract investors.

Bill Williams and I have recently discovered that many engineers know little if anything about creating value for investors.  Supported by students, we interviewed practicing engineers and found that, for example, most associate the word “value” with a number in a spreadsheet.

We also discovered little in the business and engineering research literature that can help.

A small number of “expert engineers” have worked it out for themselves, without necessarily being able to explain it in simple terms.  They are well rewarded by their clients and employers because they create so much value for their enterprises.

We have recently written a detailed explanation which, we think, explains how these experts create value, and we hope this makes sense for many more engineers who could just make enough difference, everywhere.  Not only to help frustrated Americans.  Engineers who know how to create value effectively could transform our world and eliminate poverty.

Since the industrial revolution, we have all come a long way, but most of us know we cannot sustain our civilization into the future without making some big changes.  We engineers have to lead these changes, but we need huge resources from everyone else to make it happen.  And that requires insights into value creation that elude the vast majority of engineers right now.

In coming posts I will do my best to explain the fundamental ideas that have emerged from our research and what we mean by value creation.

Why Are Investors Not Listening to Engineers?

Mineral processing refinery - summary of Ravensthorpe Nickel Refinery: Conceived 2004 for AUD 1.4 billion, Cost till 2008 Au $2.6 billion, Sold to First Quantum for AUD $250 million, AUD 2.4 billion in value destroyed

Photo: Mineral processing plant  (This is not a photograph of the Ravensthorpe Plant – image by Shutterstock)

In the first post in this series I explained just how significant engineering is in today’s sluggish world economy, both in the developed world and developing world.  In this post I will explain why investors are so reluctant to back engineering ventures.

Engineering performances are slipping, engineers are frustrated, business owners are even more frustrated and billions of people languish in misery because of engineering performance failures.  These are not spectacular failures like Fukushima or Deepwater Horizon.  Instead they are silent failures that have remained mostly out of sight, in many cases deliberately hidden by their owners.

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