Engineers make design decisions that affect the company bottom line, often without understanding how.
I'm a big proponent of engineers learning financial basics. Why? Because engineers are making decisions all the time, in multiple ways. Having a good financial understanding guides these decisions better.
Even if an engineer remains as an individual contributor as opposed to going into management, experienced engineers often become thought leaders in their organizations, involved in project priorities and strategic direction.
But when engineers do move up the management chain, financial understanding becomes critical. Portfolio mix, gross margin, and pricing are all elements that have to come together to have a sustainable and growing business.
The college course where I learned the most about financial decision-making was an Industrial Engineering course during grad school. Operational Research and Engineering Economic Sciences are two other majors that also address decision-making by looking at cash flows.
Here are five examples where engineers, or engineering managers, can benefit by good financial understanding.
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