Good engineering decisions also consider costs, investment, risk and long-term benefits.
My Master’s in Administration, Finance and Management Control helped me extend my engineering background. I studied financial statements, investment decisions, business planning and project cost control, with research focused on the aerospace industry.
When I review a proposal, I start with the facts behind the figures: the work to be done, the resources required, operating conditions, development costs and delivery dates. Connecting these points with expected benefits makes it easier to compare options with engineering and finance teams.
Technical and financial decisions affect each other. A design change can influence cost, schedule and expected benefits. A budget limit can also change the technical options available. Making these links clear helps teams choose a realistic way forward.
Start with the need, the available solutions and the resources each option requires. Net present value (NPV), internal rate of return (IRR) and payback give different views of an investment. Their value depends on reliable assumptions and a clear view of uncertainty.
Costs should be linked to activities, design changes and project dependencies. Budgets, variance analysis, Activity-Based Costing and Target Costing can help explain how technical choices affect the use of resources.
A useful review does more than list expenditure. It connects technical progress, actual costs, forecasts and risks. The aim is to understand why a forecast has changed and what the project and finance teams need to decide next.
Is the best technical solution also a sound investment?
A new tool, equipment upgrade or system improvement requires consideration of both technical feasibility and the economic assumptions behind the proposal.
A practical way to connect operational needs, technical options and financial information.
Clarify the operational problem, baseline, expected benefit and available technical options.
Output: a shared decision brief.Identify development and operating costs, benefit assumptions, cash-flow timing and the comparison period.
Output: a traceable set of assumptions.Compare scenarios for delays, utilisation and cost changes; discuss how they affect the investment case.
Output: visible trade-offs and sensitivities.Connect actual progress and expenditure with the baseline, explain deviations and support updated forecasts.
Output: a focused review of decisions and actions.24ORE Business School / Università degli Studi Guglielmo Marconi
The thesis, Administration, Finance and Management Control in the Aerospace Sector: Strategies of Triumph Aerospace and Airbus Group, examines how financial analysis, planning and management control connect with industrial strategy.
Financial-statement analysis, integrated business planning, budgeting, reporting, variance analysis and cost-management methods.
Net present value, internal rate of return, payback, discounted cash flow and sensitivity analysis as complementary ways to examine assumptions.
Historical case studies of Triumph Aerospace and Airbus, covering profitability, liquidity, indebtedness, cash generation and the relationship between resources and strategy.
The chapter draws on academic research in financial planning and management control. The company cases refer to the historical period examined in the thesis.