How an engineering department can be made profitable?

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Barry Nicholson

I can provide my experiences of working with university engineering departments - none of it has been good. There are a number of key issues, a main one being the business angle is not the main focus of the university, so the client is not getting the required attention. A private company will fail if they do not provide good service, but a university will carry on. Add to that the likely lack of field experience of the university people put on a project and there is little to recommend. The best approach is to form an arms-length alliance with another company that stands between customer and university, with agreements on IP and sales.

Igor Jurčić

Dear Muhibu,

an engineering department should be profitable deither if you have projects those you can solve to industry (companies) or you have common (joint-venture) projects with some companies from the real industry.

How much money you will invest in development, how much money you will invest in education of your students/experts, how much money you will invest in marketing (yes: invest in marketing because "marketing costs in economical theory" are not costs but investment if you invest money in right way) it is upt to you. You must develop your own model but let's say that minimum investment in further education of your experts mustn't be less than 8 % of your income (12% should be optimum), marketing inestment shold be at least 5% (10% optimum)... salaries must be less than 30-35%... so you will have appx 25 - 40 % of income to invest in new delopment, technologies, new researches, etc... and 10% will be your revenue...

It is very hard to create a business model in this short review but I do hope you can get "a clear picture" what I should advice to you...

Best regards,

Igor