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Virtual engineering (VE) is defined as integrating geometric models and related engineering tools such as analysis, simulation, optimization, and decision making tools, etc., within a computer-generated environment that facilitates multidisciplinary collaborative product development. Virtual engineering shares many characteristics with software engineering, such as the ability to obtain many different results through different implementations.

A virtual engineering environment provides a user-centered, first-person perspective that enables users to interact with an engineered system naturally and provides users with a wide range of accessible tools. This requires an engineering model that includes the geometry, physics, and any quantitative or qualitative data from the real system. The user should be able to walk through the operating system and observe how it works and how it responds to changes in design, operation, or any other engineering modification. Interaction within the virtual environment should provide an easily understood interface, appropriate to the user's technical background and expertise, that enables the user to explore and discover unexpected but critical details about the system's behavior. Similarly, engineering tools and software should fit naturally into the environment and allow the user to maintain her or his focus on the engineering problem at hand. A key aim of virtual engineering is to engage the human capacity for complex evaluation.

Computer-aided manufacturing (CAM) Computer-aided manufacturing#cite note-ota-1Interactive analysis and engineering. Today nearly all aspects of power plant simulation require extensive off-line setup, calculation, and iteration. The time required for each iteration can range from one day to several weeks. Tools for interactive collaborative engineering in which the engineer can establish a dynamic thinking process are needed to permit real-time exploration of the ˝what-if˛ questions that are essential to the engineering process. In nearly all circumstances, an engineering answer now has much greater value than an answer tomorrow, next week, or next month. Although many excellent engineering analysis techniques have been developed, they are not routinely used as a fundamental part of engineering design, operations, control, and maintenance. The time required to set up, compute, and understand the result, then repeat the process until an adequate answer is obtained, significantly exceeds the time available. This includes techniques such as computational fluid dynamics (CFD), finite elements analysis (FEA), and optimization of complex systems. Instead, these engineering tools are used to provide limited insight to the problem, to sharpen an answer, or to understand what went wrong after a bad design and how to improve the results next time. This is particularly true of CFD analysis.

Virtual engineering allows engineers to work with objects in a virtual space without having to think about the objects' underlying technical information. When an engineer takes hold of a virtual component and moves or alters it, he or she should only have to think about the consequences of such a move in the component's real world counterpart. Engineers must also be able to create a picture of the system, the various parts of the system, and how the parts will interact with each other. When engineers can focus on the making decisions for particular engineering issues rather than the underlying technical information, design cycles and costs are reduced.

Computer-aided manufacturing (CAM): Even if the CAD provide an accurate virtual shape of the objects or parts, the manufacturing of these can be far different, just because the previous tool just dealt with perfect mathematical operation (perfect point, lines, plan, volumes). To take into account in a more realistic manner of the succession of manufacturing operations and to be able to certify that the end product will be close to the virtual model, engineers make use of a manufacturing module which represent a tool that machine the parts.