=Definition.= Cost─Analysis Engineering is that branch of Engineering which has for its object the analysis of costs of construction or of operation, with a view to effecting a greater economy of production, and with a view to securing accuracy in estimating the probable cost of projected structures or operations. =The Modern Manager a Cost─Analysis Engineer.= It takes few men to design machines and structures, but it takes many men to superintend their operation. Therefore the great field of activity for the engineer of the future is in the field of operation rather than of design. Until very recent years, engineers have rested satisfied with being designers of labor─saving appliances. Now, however, they are beginning to assume the broader and more profitable function of operating the plants which their brains have created. To handle the ordinary industrial enterprise successfully, involves: _First_, the application of engineering ability in selecting and improving the machines used; _Second_, managerial ability in organizing the workmen, and in stimulating them to produce a large output economically; _Third_, advertising ability to sell the product. The man who combines in himself the maximum sum of these three abilities is the man best adapted to succeed as the executive of an industrial enterprise. Since the introduction of systems of cost analysis and unit─payments for work done, engineers have become best qualified to act as managers of manufacturing plants. We include contracting and railroading among manufacturing industries, for the contractor manufactures structures, and the railroader manufactures transportation. Before cost analysis had been developed to its present stage of excellence, the successful manager of men was usually one who had relied upon his lynx eyes and his knowledge of the weaknesses of human nature. He was often a man who owed his success largely to the fear he could inspire in his subordinates. He was domineering; he held his men to their tasks; he was, indeed, an industrial captain; and he used army discipline. He regarded every worker as a thief who would not hesitate at petty larceny of time, even in the face of the foreman, and who delighted in grand larceny behind his back. His foremen were his spies; and he set himself to spy upon his foremen. But cost─analysis engineering is evolving a wholly different class of managers and foremen. To most people, a cost─keeping system means nothing but a sort of bookkeeping; and they are unable to understand how a bookkeeper can develop into a successful manager. But the truth is that modern cost keeping involves cost analysis, and cost analysis involves a study and comparison of methods and machines, and such a study leads to improvements and to commercial success.