Critical Life-Cycle Decision Making in Complex Engineering Projects for Engineering Economy Courses

Iowa State University, Ames IA

Investigators

Abstract

Complex engineering projects (CEPs) such as electric transmission networks and transportation infrastructure are becoming increasingly important to the public in general and engineers in particular. These projects are large-scale in terms of money and time, and contain significant uncertainties over their life-cycle ranging from output prices to input costs. For CEPs, strategic decisions constitute flexibilities or 'real options' because the decision maker can alter the course of an investment over time when an uncertain aspect of the project such as the price becomes known. This project is developing (1) a module in an introductory course emphasizing the concept of the aforementioned strategic flexibilities from a stochastic optimal control perspective and (2) an advanced course emphasizing the experiential learning via a team-based project and a multidisciplinary guest-lecture series for the CEPs. Intellectual merits come primarily from learning how best to make critical decisions for CEPs under uncertainty (e.g., timing, thresholds for action, etc.). The development process is based on data-driven iterative cycles of design and reflection, as guided by the principles of educational design research. It will include three phases, each with an iteration cycle involving students: (1) Analysis & Exploration, (2) Design & Construction, and (3) Evaluation and Reflection. Baseline performance will be measured using a pre-test based on concepts and principles that a student must understand in order to perform an economic analysis correctly (i.e., declarative and procedural knowledge). The pre-test will also include self-efficacy questions. After completing the intervention (course module or the advanced course), students will take a post-test with the same set of questions. For broader impact, this project aims to transform engineering economy education via a conceptual module in an introductory course and an experiential advanced course. Given that engineering economy courses are quite ubiquitous in colleges of engineering (taken by multiple engineering majors) across the U.S., if this project is successful, the potential impact of project findings on the effectiveness of the instructional approach, teaching materials, and learning outcomes will be substantial. Ultimately students of engineering economy will become better decision makers within CEP contexts, a skill that is becoming increasingly important in technology-driven societies domestically and globally.