Engineering Economics: “Knowledge Lacking”

Press, Volume CIX, Issue 31915, 17 February 1969, Page 20

Engineering Economics: “Knowledge Lacking”

(New Zealand Press Association)

WELLINGTON, February 16.

A surprisingly large number of engineers lacked knowledge of the basic principles of engineering economics, it was contended in Wellington today by Mr F. P. S. Lu, senior lecturer in civil engineering at Canterbury University.

Those who did have that knowledge were capable of : producing, and did produce, solutions which were not only technically sound and adequate but also more economical than those made by anyone else, Mr Lu told the annual conference of the New Zealand Institution of Engineers. Arguments against engineering economics had sometimes been made because reliable cost data were unavailable, because estimates and assumptions had been known to be inaccurate, and because often, it was claimed, there were simply no alternatives existing.

All these arguments had some degree of validity, but all were, in fact, spurious, Mr Lu said.

The first argument required action on cost accounting immediately. The second argument was common among those who were unwilling to make decisions for fear of making mistakes.

The third argument was fallacious because in decisionmaking there were always alternatives. “It cannot be over-empha-sised that money is a vital resource for any engineering undertaking. The ability to put money to work, and in the most efficient manner, should be a paramount duty of every engineer,” said Mr Lu. Engineers, he said, must appreciate the economic implications of their decisions, and then try to assess them not by “hunch” or “feel,” but by the rational methods available in engineering economics.