The optimal mix of internal/external engineering staff and equipment with different levels of capability and performance

A mixed integer linear programming model (MILP) that can determine the optimal, strategic mix of internal and external engineers and equipment needed to acquire a new technology capability is presented. The model can also accommodate multilevel engineers and equipment with different performance levels, management project/technology control policies, and a multiperiod horizon. This model can aid engineering managers in the following ways: by helping the manager to recognize the numerous factors and costs that can be considered in this decision problem, by showing the mathematically optimal strategy and accompanying cost, by generating and comparing various alternative strategies, by assessing the effects of different personnel and equipment performance levels, by determining the additional costs (if any) of management's control policies, and by running sensitivity analyses on technology capacity requirements, resource performance levels, and costs. A comprehensive example problem is provided, an optimal solution is obtained, and the results are assessed. Future research extensions are offered.<
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