1

CHAPTER 9 Project management

9.1 INTRODUCTION Network scheduling is a technique used for planning, and scheduling large projects in the field of construction, maintenance, fabrication, purchasing computer system etc. The technique is a method of minimizing the trouble spots such as production, delays and interruptions, by determining critical factors and coordinating various parts of the overall job. There are two basic planning and control technique that utilize a network to complete a predetermined project or schedule. These are Programme Evaluation Review Technique (PERT) and Critical Path Method (CPM). A project is defined as a combination of interrelated activities all of which must be executed in a certain order for its completion. The work involved in a project can he divided into three phases corresponding to the management functions of planning, scheduling and control. Planning This phase involves setting the objectives of the project and the assumptions to be made. Also it involves the listing of tasks or jobs that must be performed to complete a project under consideration. In this phase, men, machines and materials required for the project in addition to the estimates of costs and duration of the various activities of the project are also determined. Scheduling This consists of laying the activities according to the precedence order and determining, (i) the start and finish times for each activity (ii) the critical path on which the activities require special attention and (iii) the slack and float for the non-critical paths. Controlling This phase is exercised after the planning and scheduling, which involves the following: (i) Making periodical progress reports (ii) Reviewing the progress (iii) Analyzing the status of the project and (iv) Management decisions regarding updating, crashing and resource allocation etc.

9.2 BASIC TERMS To understand the network techniques one should be familiar with a few basic terms of which both CPM and PERT are special applications. Network It is the graphic representation of logically and sequentially connected arrows and nodes representing activities and events of a project. Networks are also called arrow diagram. Activity An activity represents some action and is a time consuming effort necessary to complete a particular part of the overall project. Thus, each and every activity has a point of time where it begins and a point where it ends. It is represented in the network by an arrow as follows. . Here A is called the activity and i and j are start and end nodes. Event The beginning and end points of an activity are called events or nodes. Event is a point in the time and does not consume any resources. It is represented by a numbered circle. The head event called the jth event has always a number higher than the tail event called the ith event.

Merge and burst events it is not necessary for an event to be the ending event of only one activity but can be the ending event of two or more activities. Such event is defined as a Merge event.

If the event happens to be the beginning event of two or more activities it is defined as a Burst event

Preceding, succeeding and concurrent activities Activities which must be accomplished before a given event can occur are termed as preceding activities. Activities which cannot be accomplished until an event has occurred are termed as succeeding activities. Activities which can be accomplished concurrently are known as concurrent activities. This classification is relative, which means that one activity can be preceding to a certain event, and the same activity can be succeeding to some other event or it may be a concurrent activity with one or more activities. Dummy activity Certain activities which neither consumes time nor resources but are used simply to represent a connection or a link between the events are known as dummies. It is shown in the network by a dotted line. The purpose of introducing dummy activity is (i) (ii) to maintain uniqueness in the numbering system as every activity may have distinct set of events by which the activity can be identified. To maintain a proper logic in the network.

9.3 COMMON ERRORS Following are the three common errors in a network construction: Looping (cycling) In a network diagram looping error is also known as cycling error. Drawing an endless loop in a network is known as error of looping. A loop can be formed if an activity were represented as going back in line.

Dangling To disconnect an activity before the completion of all the activities in a network diagram is known as Dangling.

Redundancy If a dummy activity is the only activity emanating from an event and which can be eliminated is known as redundancy.

9.4 RULES OF NETWORK CONSTRUCTION There are number of rules in connection with the handling of events and activities of a project network that should be followed. (i) Try to avoid arrows which cross each other. (ii) Use straight arrows. (iii) No event can occur until every activity preceding, it has been completed. (iv) An event cannot occur twice i.e. there must be no loops. (v) An activity succeeding an event cannot be started until that event has occurred. (vi) Use arrows from left to right. Avoid mixing two directions, vertical and standing arrows may be used if necessary. (vii) Dummies should be introduced if it is extremely necessary. (viii) The network has only one entry point called the start event and one point of emergence called the end or terminal event. Numbering The Events After the network is drawn in a logical sequence every event is assigned a number. The number sequence must be such so as to reflect the flow of the network. In numbering the events the following rules should be observed. (i) Event numbers should be unique. (ii) Event numbering should be carried out on a sequential basis from left to right. (iii) The initial event which has all outgoing arrows with no incoming arrow is numbered as 1. (iv) Delete all arrows emerging from all the numbered events. This will create at least one new start event out of the preceeding events. (v) Number all new start events 2,3 and so on. Repeat this process until all the terminal event without any successor activity is reached, number the terminal node suitably. Note: The head of an arrow should always bear a number higher than the one assigned to the tail of the arrow.

Construction of Network EXAMPLE 9.1 Construct a network for the project whose activities and their precedence relationships are as given in Table 9.1: TABLE 9.1 Activities A B C D E F G H I Immediate __ A A __ D B,C,E F D G,H -Predecessor Solution From the given constraints, it is clear that A, D are the starting activity and I the terminal activity. B, C are starting with the same event and are both the predecessors of the activity F. Also E has to be the predecessor of F. Hence, we have to introduce a dummy activity.

D1 is the dummy activity. Finally we have the following network.

Fig. 9.1 EXAMPLE 9.2 Construct a network for the project whose activities and their precedence relationships are as given in Table 9.2. TABLE 9.2 Activities A B C D A E C F G H I J K Immediate __ -Predecessor SOLUTION __ __ B,D B,D E,F A G,H E,F

9.5 TIME ANALYSIS Once the network of a project is constructed the time analysis of the network becomes essential for planning various activities of the project. An activity time is a forecast of the time an activity is expected to take from its starting point to its completion (under normal conditions). We shall use the following notation for basic scheduling computations. (i, j) = Activity (i, j) with tail event i and head event j Tij = Estimated completion time of activity (i, j) ESij = Earliest starting time of activity (i, j) EFij = Earliest finishing time of activity (i, j) (LS) ii = Latest starting time of activity (i, j)

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(LF)ij= Latest finishing time of activity (i, j) The basic scheduling computation can be put under the following three groups. Forward Pass Computations (for earliest event time) Before starting computations, the occurrence time of the initial network event is fixed. The forward pass computation yields the earliest start and the earliest finish time for each activity (i, j) and indirectly the earliest occurrence time for each event namely E. This consists of the following 3 steps. Step 1 The computations begin from the start node and move towards the end node. Let zero be the starting time for the project. Step 2 Earliest starting time (ES)ij = E ij is the earliest possible time when an activity can begin assuming that all of the predecessors are also started at their earliest starting time. Earliest finish time of activity (i, j) is the earliest starting time + the activity time.

(EF)ij = (ES)ij + t ij
Step 3 Earliest event time for event j is the maximum of the earliest finish time of all the activities ending at that event.
E j = max(E i + t ij )
i

Backward Pass Computations (for latest allowable time) The latest event time (L) indicates the time by which all activities entering into that event must be completed without delaying the completion of the project. These can be calculated by reversing the method of calculations used for the earliest event time. This is done in the following steps. Step 1 For ending event assume E = L. Step 2 Latest finish time for activity (i j) is the target time for completing the project

(LF)ij = L ij
Step 3 Latest starting time of the activity (i,j) =latest completion time of ( i, j)-the activity time t ij

(LS)ij = (LF)ij t ij
= L j t ij

Step 4 Latest event time for event i is the minimum of the latest start time of all activities originating from toe event.

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L i = min (L j t ij )
j

9.6 DETERMINATION OF FLOATS AND SLACK TIMES Float is defined as the difference between the latest and the earliest activity time. Slack is defined as the difference between the latest and the earliest event time. Hence the basic difference between the slack and float is that slack is used for events only, whereas float is used for activities. There are mainly three kinds of floats as given below. Total float It refers to the amount of time by which the completion of an activity could be delayed beyond the earliest expected completion time without affecting the overall project duration time. Mathematically, the total float of an activity (i, j) is the difference between the latest start time and the earliest start time of that activity. Hence the total float for an activity (i, j) denoted by TFij is calculated by the formula
TFij = (Latest start-Earliest start) for activity (i, j)

where E, L are the earliest time and latest time for the tail event i and head event J and t is the normal time for the activity (i, j) This is the most important type of float as it concerns with the overall project duration. Critical activity An activity is said to be critical if a delay in its .start will cause a further delay in the completion of the entire project. Critical path The sequence of critical activities in a network is called the critical path. It is the longest path in the network from the starting event to the ending event and defines the minimum time required to complete the project. In the network it is denoted by double line. This path identifies all the critical activities of the project. Hence, for the activity (i, j) to lie on the critical path, following conditions must be satisfied. (a) ESi = LFi (b) ES j = LFj (c) ESi ES j = LFi LFj t ij . Es., Es, are the earliest start, and finish time of the event i and j Lf , LF are the latest start, finish time of the event i and j.

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9.7 CRITICAL PATH ANALYSIS The Critical path of a network gives the shortest time in which the whole project can be completed. It is the chain of activities with the longest time durations. These activities are critical activities. They are critical in the sense that delay in any of them results in the delay of the completion of the project. There may be more than one critical path in a network and it is possible for the critical path to run through a dummy. The critical path analysis consists of the following steps:
1.

Calculate the time schedule for each activity : It involves the determination of the time by which

an activity must begin and the time before which it must be completed. The time schedule data for each activity include the calculation of the earliest start, the earliest finish, the latest start, the latest finish times and the float.
2.

Calculate the time schedule for the completion of the entire project: It involves calculation of Identify the critical activities and find the critical path : Critical activities are the once which must

project completion time and the probability of completion of theproject on or before that time.
3.

be started and completed on schedule or else the project may get delayed. The path containing these activities is the critical path and is the longest path in terms of duration. EXAMPLE 9.3 Consider the network shown in Fig. 9.3 which consists of the following activities as shown in the Table 9.3 TABLE 9.3 Activities A B C D E F G H I J Immediate - __ Predecessor 15 Duration(weeks) __
15

A
3

A
5

B,C
8

B,C
12

E
1

E
14

D
3

F,H,I 14

Fig: 9.3

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The earliest start time (E) for an activity represents the time at which an activity can begin at the earliest. It assumes that all the preceding activities start and finish at their earliest times. For instance earliest start times of activities 1-2 and 1-3 are zero each or the earliest occurrence time of event 1 is zero. Earliest start times of activities 2-3 and 2-5 or the earliest occurrence time of event 2 is obtained by adding activity time t12 to earliest occurrence time of event 1 i.e., it is 0+15=15. Next consider event 3. It can be reached directly from event 1 or via event 2, the times for the two sequences being 15 and 15 + 3 = 18. Since event 3 can occur only when all the preceding activities and events have taken place, its earliest occurrence time or the earliest start times of activities emanating from even 3 is 18, the higher of the two values 15 and 18. This is represented by putting E3 = 18 around its node in the network. Likewise, the earliest occurrence time of each event can be determined by proceeding progressively from left to right i.e., following the forward pass method according to the following rule: If only one activity converges on an event, its earliest start time E is given by E of the tail event of the activity plus activity duration. If more than one activity converges on it, E's via all the paths would be computed and the highest value chosen and put around the node. The E's calculated for the problem at hand are shown in the network diagram. The latest finish time (L) for an activity represents the latest by which an activity must be completed in order that the project may not be delayed beyond its targeted completion time. This is calculated by proceeding progressively from the end event to the start event. The L for the last event is assumed to be equal to its E and the L's for the other events are computed by the following rule (using backward pass method): If only one activity emanates from an event, compute L by subtracting activity duration from L of its head event. If more than one activity emanates from an event, compute L's via all the paths and choose the smallest and put it around the event at hand. The L's calculated for the problem at hand are shown in the network diagram. Next, the earliest finish time (TEF) and the latest start time (TLS) for an activity are computed: TEF = E + tij, TLS = L tij, where tij if is the duration for activity i- j. Float (also called total float) for an activity is then calculated: F=LTEF or F=TLS-E. Float is, thus, the positive difference between the finish times or the positive difference between the

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start times. The following analysis table 9.4 is then compiled reference to the Fig. 9.3: Activity (1) A(1-2) B(1-3) C(2-3) D(2-5) E(3-4) F(3-6) G(4-5) H(4-6) I(5-6) J(6-7) Duration (2) 15 15 3 5 8 12 1 14 3 14 (3) 0 0 15 15 18 18 26 26 27 40 TABLE 9.4 Start time Finish time Earliest Latest (4) 0 3 15 32 18 28 36 26 37 40 Earliest (5) 15 15 18 20 26 30 27 40 30 54 Latest (6) 15 18 18 37 26 40 37 40 40 54 Total float (weeks) (7) 0 3 0 17 0 10 10 0 10 0

Columns 1 and 2 contain the activities and their durations is weeks. Under column 3 are noted the E's for the tail events and under column 6 are noted the L's of the head events. Other columns are then computed as follows: column 4 = column 6 column 2, column 5 = column 3 + column 2, and column 7= column 6 column 5, = column 4 column 3. As an example, consider activity 1-2. Its tail event 1 has E = 0. Put 0 against this activity under column 3. Its head event 2 has L = 15. Put 15 against it under column 6. Under column 4 note the value in column 6 minus activity duration i.e., 15 15 = 0. Under column 5 note the value in column 3 plus activity duration i.e., 0 + 15 = 15. Compute total float by subtracting column 5 from 6 or column 3 from 4. Total float for activity 1-2 is 0. Similarly, calculate total float for other activities. Critical path is the path containing activities with zero float. These activities demand above normal attention with no freedom of action. For the problem at hand it is 1-2-3-4-6-7 and is shown by double arrows in Fig. 1. The project duration is 54 weeks. Sometimes, there may be more than one critical path i.e., two or more paths with the same maximum completion time. Non-critical activities have positive float (slack) so that we may slacken while executing them and concentrate on the critical activities. While delay in

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any critical activity will delay the project completion, this may not be so with the non-critical activities. 9.8 THE THREE FLOATS Total float : It is the difference between the maximum time available to perform the activity and the activity duration. The maximum time available for any activity is from the earliest start time to the latest completion time. Thus for an activity i - j having duration tij, Maximum time available = L E. Total Float = L E ty = (L tij) E or L (E + tij) = TLS - E or L TEF. Thus the total float of an activity is the difference of its latest start and earliest start times or the difference of its latest finish and earliest finish times. Total float represents the maximum time within which an activity can be delayed without affecting the project completion time. Free Float : It is that portion of the total float within which an activity can be manipulated without affecting the floats of subsequent activities. It is computed by subtracting the head event slack from the total float (TF). The head event slack is (L E) of the event. Free float (FF) of activity i - j = T.F. (L E) of event j. Independent Float : It is that portion of the total float within which an activity can be delayed for start without affecting the floats of preceding activities. It is computed by subtracting the tail event slack from the free float. If the result is negative, it is taken as zero. Independent float of activity of i - j = F.F. (L E) of tail event j. Apart from the above three floats, there is another float, namely the interfering float for the activities. Subcritical Activity : Activity having next higher float than the critical activity is called the subcritical activity and demands normal attention but allows some freedom of action. The path connecting such activities is named as the subcritical path. A network may have more than one subcritical path. Supercritical Activity : An activity having negative float is called supercritical activity. Such an activity demands very special attention and action. It results when activity duration is more than the time available. Such negative float, though possible, indicates an abnormal situation requiring a decision as to how to compress the activity. It can be done by employing more resources so as to make the total float zero or positive. Compression of the network, however, involves an extra cost.

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Slack: It is the time by which occurrence of an event can be delayed. It is denoted by S and is the difference between the latest occurrence time and earliest occurrence time of the event. i. e., S = L - E of the event In the above discussion, the term float has been used in connection with the activities and slack for the events. However, the two terms are being used interchangeably i.e., slack for the activities and float for the events by some of the writers. EXAMPLE 9.4 Tasks A, B, C, H, I constitute a project. The precedence relationships are A < D; A<E, B < F; D < F, C < G, C < H; F < I, G < I Draw a network to represent the project and find the minimum time of completion of the project when time, in days, of each task is as follows: Task Time A 8 B 10 C 8 D 10 E 16 F 17 G 18 H 14 I 9

Also identify the critical path. SOLUTION

Fig. 9.4(a) The given precedence order reveals that there are no predecessors to activities A, B, and C and hence they all start from the initial node. Similarly, there are no successor activities to activities E, H and I and hence, they all merge into the end node of the project. The network obtained is shown in Fig. 9.4(a).

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The nodes of the network have been numbered by using the Fulkerson's rule. The activity. descriptions and times are written along the activity arrows. To determine the minimum project completion time, let event 1 occur at zero time. The earliest occurrence time (E) and the latest occurrence time (L) of each event is then computed. El = 0, E2 = El + t12 =0 + 8 = 8, E3 = El + t13 = 0 + 8 = 8, E4 = Max. [0 + 10, 8 + 10] = 18, E5 = Max. [18 + 17, 8 + 18] = 35, E6 = Max. [8 + 16, 35 + 9, 8+14]=44. Similarly, L6 = E6 = 44, L5 = L6 t56 = 44 9 = 35, L4 = L5 t45 = 35 17 = 18, L3 = Min. [44 14, 35 18 = 17, L2 = Min. [44 . 16, 18 10] = 8, L1 =Min. [8-8, 17-8, 18 10] =0. The E and L values for each event have been written along the nodes in Fig. 9.4(b).

Fig. 9.4(b) The critical path is now determined by any of the following methods:

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Method 1. The network analysis table is compiled as shown in the Table 9.5. TABLE 9.5 Start time Finish time Total float Activity Duration Earliest Latest Earliest Latest (weeks) 1-2 8 0 0 8 8 0 1-3 8 0 9 8 17 9 1-4 10 0 8 10 18 8 2-4 10 8 8 18 18 0 2-6 16 8 28 24 44 20 3-5 18 8 17 26 35 9 3-6 14 8 30 22 44 22 4-5 17 18 18 35 35 0 5-6 9 35 35 44 44 0 Activities 1-2, 2-4, 4-5 and 5-6 having zero float are the critical activities and 1-2-4-5-6 is the critical path. Method 2. For identifying the critical path, the following conditions are checked. If an activity satisfies all the three conditions, it is critical. (i). E = L for the tail event. (ii). E = L for the head event. (iii). Ej - Ei = Lj - Li = tij. Activities 1-2, 2-4, 4-5 and 5-6 satisfy these conditions. Other activities do not fulfill all the three conditions. The critical path is, therefore, 1-2-4-5-6. Method 3. The various paths and their duration are: Path Duration (days) 1-2-6 24 1-2-4-5-6 44 1-4-5-6 36 1-3-5-6 35 1-3-6 22 Path 1-2-4-5-6, the longest in time involving 44 days, is the critical path. It represented by doublebold lines in Fig. 9.4(b).

EXAMPLE 9.5 A project consists of a series of tasks labelled A, B. H, I with the following constraints A< D,E; B, D<F: C<G; B<H; F, G<I. (W<X, Y means X, and Y can't start until W is completed.) You are required

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to construct a network using this notation. Also find the minimum time of completion of the project when the time of completion of each task is given as follows. Task A B 8 A -B -C 20 C -D 16 D A E 24 E A F 18 F B,D G 19 G C HI 4 H B 10 I G,F Time(days) 23 Activity Proceeding Activity To determine the minimum time of completion of the project, we compute ESi and LFj for each of the tasks (i, j) of the project. The critical path calculations are as shown in the Table 9.6. Critical path 1-2-3-5-6 TABLE 9.6 Actvity A (1-2) B (1-3) C (1-4) D (2-3) E(2-6) F( 3-5) H( 3-6) G( 4-5) I(5-6) Normal time Start 23 8 20 16 24 18 4 19 10 0 0 0 23 23 39 39 20 57 Earliest Finish 23 8 20 39 47 57 43 39 67 Start 0 31 18 23 43 39 63 38 57 Latest Finish 23 39 38 39 67 57 67 57 67 0 8 18 0 20 0 24 18 0 Total floats

SOLUTION The given constraints can be given in the Table 9.5.

The above table shows that the critical activities are 1-2, 2-3, 3-5, 5-7 as their total float is zero. Hence, we have the critical path, 1-2-3-5-7 with the total project duration (the least possible time to complete the entire project as 67 days.

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Fig. 9.5 EXAMPLE 9.6 A project schedule has the following characteristics: Activity 1-2 1-3 2-4 3-4 3-5 4-9
(i) Construct the network. (ii)

Time (weeks) 4 1 1 1 6 5

Activity 5-6 5-7 6-8 7-8 8-10 9-10

Times (weeks) 4 8 1 2 5 7

Compute E and L for each event, and (iii) Find the critical path. SOLUTION The given data results in a network shown in Fig. 9.6. The figures along the arrows represent the activity times.

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Fig. 9.6 The earliest occurrence time (E) and the latest occurrence time (L) of each event are now computed by employing forward and backward pass calculations. In forward pass computations, E values are represented in Fig.9.6 and in backward pass computations, L values are also represented in Fig. 9.6. Network analysis table is given Table 9.7. TABLE 9.7 Activity 1-2 1-3 2-4 3-4 3-5 4-9 5-6 5-7 6-8 7-8 Duration 4 1 1 1 6 5 4 8 1 2 Start time Earliest Latest 0 5 0 4 1 1 5 7 7 11 15 0 9 9 1 10 12 7 16 15 Finish time Earliest Latest 4 9 1 5 2 7 10 11 15 12 17 1 10 10 7 15 16 15 17 17 Total float (weeks) 5 0 5 8 0 5 5 0 5 0

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8-10 9-10 EXAMPLE 9.7

5 7

17 10

17 15

22 17

22 22

0 5

Path 1-3-5-7-8-10 with project duration of 22 weeks is the critical path. The utility data for a network are given below. Determine the total, free, and independent floats and identify the critical path. Activity Duration SOLUTION The network diagram for the given project data is shown in Fig. 9.7. Activity durations are written along the activity arrows. The earliest start and latest finish times of the activities are computed by employing the forward pass and backward pass calculations, as explained in example 9.2. These times are represented in the network around the respective nodes. The network analysis table is now constructed in Table 9.8. 0-1 2 1-2 8 1-3 10 2-4 6 2-5 3 3-4 3 3-6 7 4-7 5 5-7 2 6-7 8

Fig.9.7

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TABLE 9.8 Activity 0-1 1-2 1-3 2-4 2-5 3-4 3-6 4-7 5-7 6-7 Durat ion 2 8 10 6 3 3 7 5 2 8 Start time Earliest Latest 0 2 2 10 10 12 12 16 13 19 0 8 2 16 22 19 12 22 25 19 Finish time Earliest 2 10 12 16 13 15 19 21 15 27 Latest 2 16 12 22 25 22 19 27 27 27 Total 0 6 0 6 12 7 0 6 12 0 Float Free 0 0 0 0 0 1 0 6 12 0 Independent 0 0 0 6 0 6 0 1 0 0 0 0

Total float is the positive difference between latest and earliest finish times or latest and earliest start times. For activity 1-2, Total float (T.F.) = 16 10 = 8 2 = 6. Similarly, for activity, say 2-5, Total float = 25-13 = 22 -10 = 12 and so on. Total float calculations are depicted in column 7 of table 4. Free float of activity i - j = Total float head event slack = Total float (L E) of event j. Thus free float of activity 0 1 =0(LE) of event 1, = 0(2-2)=0, free float of activity 1 -2 =6(16 10)=6-6=0etc. Free floats of various activities are calculated in column 8 of the network analysis table. Independent float of activity i - j = Free float tail event slack = Free float (L E) of event i. Thus independent float of activity 0 - 1 = 0 (0 0) = 0, independent float of activity I - 2= 0 (2 2) = 0, independent float of activity 2 4 = 0 (16 10) = 6 0 and so on. Independent floats of various activities are calculated in column 9 of the Table 9.8. If independent float of an activity is negative, it is taken as zero.

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EXAMPLE 9.8 For the network given in Fig 9.8, determine the total, free, and independent floats for each activity. Times for activities are in months.

Fig. 9.8 SOLUTION The computations of earliest start, earliest finish, latest start and latest finish times along with floats are given in Table 9.9. TABLE 9.9 Activity Duratio n 1-2 1-3 2-3 24 3-4 3-5 4-5 4-8 5.6 5-7 8 10 4 0 5 6 4 8 5 7 Start time Earliest Latest 0 0 8 8 12 12 17 17 21 21 0 2 8 17 12 15 17 24 21 22 Finish time Earliest 8 10 12 8 17 18 21 25 26 28 Latest 8 12 12 17 17 21 21 32 26 29 Total 0 2 0 9 0 3 0 7 0 1 Float Free 0 2 0 9 0 3 0 7 0 1 Independent 0 2 0 9 0 3 0 7 0 1

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6-7 6-8 7-8

3 5 3

26 26 29

26 27 29

29 31 32

29 32 32

0 1 0

0 1 0

0 1 0

Activities 1-2, 2-3, 3-4, 4-5, 5-6, 6-7 and 7-8 have zero float and hence are critical. The path 1-2-34-56-7-8 is the critical path with the project duration of 32 months. Total, free and independent floats are calculated as explained in example 9.4 and are represented in the last four columns of the Table 9.9. EXAMPLE 9.9 Estimated times for the jobs of a project are given below: Job: Time: (weeks) The constraints governing the jobs are as fo1lows: A and B are start jobs; A controls C, D and E; B controls F and J; G depends upon C; H depends on D; E and F control I and L; K follows J; L is also controlled by K; G, H, I and L are the last jobs. Draw the network, determine float for each activity, project duration and the critical path. SOLUTION The network obtained by using the given precedence relationship is shown in Fig. 9.10. Events have been numbered using the Fulkerson's rule. Note that a dummy activity 6-8 has been included to draw the network. The earliest start times and latest completion times of the activities can be computed by using the forward and backward pass methods. Critical path is 1-2-6-8-9 and project duration is 39 weeks. A 13 B 5 C 8 D 10 E 9 F 7 G 7 H 12 I 8 J 9 K 4 L 17

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Fig. 9.10 9.9 COST ANALYSIS AND CRASHING THE NETWORK 9.9.1 Project Cost Each activity of the project consumes some resources and hence has cost associated with it. In most of the cases cost of an activity will vary to some extent with the amount of time consumed by the activity. The cost of total project, which is the aggregate of the activity costs will also depend upon the project duration time. Thus by increasing the costs, the project duration can be cut down to some extent. The aim is always to strike a balance between the costs and time, and to obtain an optimum project schedule. An optimum project schedule implies lowest possible cost and the associated time for the project. The total cost of any project consists of the direct and indirect costs involved in its execution. 9.9.2 Direct Cost The cost is directly dependent upon the amount of resources involved in the execution of the individual activities. This is the cost of the materials, equipment and labour required to perform the activity. If the activity is performed by a subcontractor, the price of the subcontract will be the activity direct cost. It can be seen from the direct cost-time relationship shown in Fig. 9.11 that the activity duration can be varied by varying the cost. Point N, referred to as the 'Normal Point

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corresponds to the normal activity time. If the duration is further increased, the decrease in cost is insignificant. As the activity is compressed, the direct cost goes on increasing. If it is compressed beyond C, the cost increases very rapidly for insignificant change in the activity duration. This point is called 'crash point'. Crash time is thus the minimum activity duration to which an activity can be compressed by increasing the resources and hence by increasing the direct cost. To make the calculations simple, the direct cost-time curve is approximated to either a single straight line or multi-straight lines (segments), as shown in Fig. 9.12. The slope of the line (or a segment of line) gives the increase in direct cost per unit time for expediting the activity. This is called cost slope. For the straight line approximation in Fig. 9.12,

cost slope =

C c C n C = Tc Tn T

Fig. 9.11 The choice between the single straight line and segmented approximation depends upon the nonlinearity of the cost curve. Also the segmented approximation is adopted only when the activity can be broken down into sub activities. Above all, it is the judgment of the executive whether to approximate the curve by segments and go through involved calculations or to use a little rough single slope approximation and save calculation work.

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Fig. 9.12 9.9.3 Indirect Cost Project indirect cost can further be sub-divided into two parts: fixed indirect cost and variable indirect cost. The fixed indirect cost is due to the general and administrative expenses, licence fee, insurance cost and taxes and does not depend upon the progress of the project. The variable indirect cost depends upon the time consumed by the project and consists of overhead expenditure, suppervision, interest on capital and depreciation, etc. It is assumed that the indirect cost increases linearly with time as shown in figure 9.13. The sum of the direct and indirect cost gives the total project cost. As the direct cost decreases with time and indirect cost increases with time, the total project cost curve will have a point where the total cost will be minimum (Fig. 9.14). The time corresponding to this point is called the optimum duration and the cost, the optimum cost.

29

9.10 Crashing (Contracting or Compressing) the Network

Often there may be compelling reasons to complete the project earlier than would be the case with the duration of the critical path computed on the basis of normal activity times. Examples are war situations or market introduction of a new product. In such situations, our concern is to find the project cost if some or all the activities are crashed. From the knowledge of the normal direct cost and crashed direct cost, the cost slope for each activity can be determined. If the indirect cost/time is known, the total cost of the project can be found by adding the direct and indirect costs. The normal time (tn) for the completion of the project will be the sum of the normal time durations of the critical activities and the normal direct cost (Cn) of the project will be the sum of the normal cost of all the activities since each and every activity has to be executed to complete the project. The minimum time (tc) that the project will take for its completion will be sum of the crashed time durations of the activities along the critical path. If all the activities (critical as well as noncritical) are crashed, the cost will be very high without any additional advantage over and above the one obtained by crashing only the critical activities. Therefore, the non-critical activities need not be expedited since their crashing is not going to decrease the project duration further. However, in the process of crashing the critical activities, it may so happen that some of the noncritical activities become critical. It is, therefore, essential to proceed step by step, crashing one activity at a time and examine whether any other non-critical activity has also become critical. Obviously, first the critical activity with minimum cost slope should be selected for crashing and so on till all the critical activities are fully crashed or no further crashing is possible. At each step of crashing, the direct cost is calculated; it would naturally be higher than the normal

30

direct cost as it. includes the additional crash cost too. However, the indirect cost will reduce as the project duration has been reduced. The total cost is then found at each step. A table or a curve may be constructed between the total cost and time. It is found that as the project duration is decreased, the total cost may also decrease, reaching the minimum value, beyond which it may increase. This minimum cost is called the optimum project cost and the corresponding time, the optimum project time. The crashing may be further continued to get the minimum or crash project time and the corresponding crash cost. EXAMPLE 9.10 List of activities for erecting a canteen in a factory is given in Table 9.10 with other relevant details. Job A must precede all others while job E must follow others. Apart from this, jobs can run concurrently. TABLE 9.10 Code A B C D E Normal Duration Cost (days) (Rs.) Lay foundation and build walls 5 3,000 6 4 5 3 1,200 1,000 1,200 1,600 8,000 Job description Crash Duration Cost (days) (Rs.) 4 4,000 2 3 3 3 2,000 1,800 2,000 1,600

Tile roofing Instal electricity Instal plumbing Connect services to finish Total cost
(i)

Draw the network and identify the critical path.

(ii) Crash the network fully to find out minimum duration. (iii) If indirect costs are Rs. 300 per day, determine time-cost trade offer the project.

SOLUTION First, the cost slope for each activity and the normal direct cost of the project is calculated. This is shown in the table below. Job Cost slope (Rs./ day) Next, the network is drawn and the critical path is determined. An activity (i - j) is critical only if A (1-2) B (2-3) 1,000(1) C (2-5) D (2-4) 400(3) E (5-6) __ 200(4) 800(1)

31

E = L for its tail event, E = L for its head event and Ej Ei= Lj Li = tij. Critical path is shown in Fig. 9.15.

Fig. 9.15 (i) Critical path is 1-2-3-5-6. Normal duration = 14 days. Normal cost = Rs. (8,000 + 300 x 14) = Rs. 12,200. (ii) Represent the network on time-scaled diagram. This is shown in Fig. 9.15. Activities along the critical path are arranged along the horizontal line 1-2-3-5-6. Early start times for the activities have been assumed. Dotted lines show the floats for the non-critical activities. Project length can be reduced by crashing the critical activities. This will involve extra direct-cost. While crashing a critical activity, it is possible that some associated non-critics activity (or activities) may also have to be crashed. If float is available no extra cost for such activity (or activities) will be involved; if not, the cost of crashing such activity (activities) will also be considered and the total cost will be calculated. Then the critical activity involving the least associated cost will be selected for crashing. While crashing a critical activity, only those non-critical activities will require crashing which start from the tail event of the critical activity under consideration or earlier and finish at the head event of the critical activity or later than that. This rule may be kept in mind while crashing the activities.

32

Fig. 9.16 Crash activity B (2-3), C (2-5) and D (2-4) by one day each. it is crashed by one day. The various alternative critical activities and their crash costs are given in Table 9.11. TABLE 9.11 Activity A (1-2) B (2-3) C(2-5) D(2-4) E(5-6) Cost (Rs.) 1,000(1) 200(4) 800(1) 400(2) 0

Since activity 2-3 has the lower associated crash cost of Rs. 200 per day, Crash cost = Rs. 200, project duration = 13 days. The network is shown in Fig. 9.17.

33

Fig. 9.18 Crash activities B, C and D by one day each. The various activities and their crash costs are given below. Activity A (1 -2) B (2-3) D (2-4) C (2-5) Total The network is shown in Fig. 9.19. Cost (Rs) 1,000 200 400 Nil 600

Crash cost = Rs. (200 + 600) = Rs. 800, project duration = 12 days.

34

Fig. 9.19 Crash activity A (1-2) by one day. The various activities and their crash costs are given below. Activity B (2-3) D (2-4) C (2-5) Total Cost (Rs) 200 400 800 1,400

Crash cost = Rs. (1,000 + 800) Rs. 1,800, project duration = 11 days. The network is shown in Fig. 9.20 Crash activities B, C and D by one day each. Crash cost = Rs. (1,400 + 1,800) = Rs. 3,200, project duration = 10 days.

35

Fig. 9.20

Fig. 9.21 The network is shown 9.21. All actvities are fully crashed. Thus minimum project duration is 10 days. The complete crasging of the network from 14 days to 10 days. The above results are summarized in the Table 9.12. .

36

TABLE 9.12 Duration(days) 14 13 12 11 10 is Rs. 12,100. EXAMPLE 9.11 The Table 9.13 gives the activities of a constriction project and other relevant information. (a) What is the normal project length and the minimum project length? (b) Determine the minimum crashing costs of schedule ranging from normal length down to and including the minimum length schedule. TABLE 9.13 Activity i- j 1-2 1-3 1-4 2-4 3-4 4-5 Normal duration (days) 9 8 15 5 10 2 Crash duration (days) 6 5 10 3 6 1 Cost of crashing (Rs per day) 20 25 30 10 15 40 Normal direct cost (Rs.) 8,000 8,000 8,000 8,000 8,000 Crash cost Indirect cost (Rs) 0 200 800 1,800 3,200 (Rs) 4,200 3,900 12,400 3,300 3,000 13,100 14,200 Total cost (Rs) 12,200 12,100

Thus time-cost trade off exists at 13 days when B is crashed by I day and the tots minimum cost

(c) What is the optimal length schedule duration of each job for your solution? Overhead of the project is Rs. 60 per day. SOLUTION

37

Since the overhead cost is given the cost is indirect. The project duration can by reducing the cost associated with it. The critical path comprises the 1-3, 3-4 and 4-5 with the normal duration as 20 days. The total cost associated with the project is 20 X 60 = Rs. 1,200.

Activity 1-2 1-3 1-4 2-4 3-4 4-5

Cost of crashing 20 (3) III 25 (3) IV 30 (5) V 10 (2) I 15 (4) II 40 (1) VI

The cost slope is given in the data. We reduce the project duration by crashing the activity lying on the critical path. The critical activity 3-4 has the minimum cost slope. It is Ranked I, so this activity is crashed first for 4 days. The other paths of the network are: Normal duration 20 19 18 17 16 Crash activity 3-4 (1) 3-4 (2) 3-4 (3) 4-5 Crash cost 1 x 15 = 15 15 +1 x15 = 30 30 + 1 x 15 = 45 45 + 1 x 40 = 85 Overhead cost 20 x 60 = 1200 19 x 60 = 1140 18 x 60 = 1080 17 x 60 = 1020 16 x 60 = 960 Total Cost 1200 1155 1110 1065 1045

38

15

14 13

(1-3-4-5-1-4-5) 3-4 (1-3-4-5) 1-4 ( 1-4-5) 2-4 (1-2-4-5) 1-3 (1-3-4-5) 1-4 (1-4-5) 2-4 (1-2-4-5) 1-3 ( 1-3-4-5) 1-4 (1-4-5 ) 1-2 (1-2-4-5)

85 + 15 + 30 +10=140 140+25+30 +10=205 205+25+30 +20 = 280

15 x 60 = 900

1040

14 x 60 = 840 13 x 60= 780

1045 1060

After 17 days, we get parallel paths namely, 1-3-4-5 and 1-4-5. We crash the activity 4-5 for one day at the rate of Rs. 40 per day. After 16 days we get all the critical paths. As three is no common activity between them, we crash the activity 3-4 for the path 1-3-4-5, 1-4 for the path 1-4-5 and 2-4 for the path 1-2-4-5. As the activity 3-4 in the path 1-3-4-5 is in crash time, we crash the activity 1-3 for 1 day at the rate of Rs. 25 per day. The optimum duration is 15 days as it gives the minimum cost of Rs. 1040. To find the minimum duration we crash further. Normal duration 12 Crash activity 1-3 (1-3-4-5) 1-4(1-4-5) 1-2(1-2-4-5) Crash cost Overhead cost Total Cost 1075

280+25+30+20=355 12 x 60 = 720

The minimum duration is 12 days and no more crashing is possible as all activities in the path 1-3-4-5 are in crash time. Optimum duration = 15 days with total cost associated as Rs 1040 Minimum duration = 12 days with total cost associated as Rs 1075. Note: From the above problem we observe that the optimum duration and minimum duration are not same. Optimum duration refers to the which yields the minimum total cost where as minimum duration is the one in which no more crashing is possible beyond that duration. EXAMPLE 9.12 The table below provides cost and estimates for a seven activity project. Activity A (1-2) Normal 2 Time estimate (weeks) Crash 1 Direct cost estimate (Rs. 1000) Normal Crash 10 15

39

B (1-3) C (2-4) D (3-4) E (3-5) F (4-6) G (5-6)

8 4 1 2 5 6

5 3 1 1 3 2

15 20 7 8 10 12

21 24 7 15 16 36

(a) Draw the project network corresponding to normal time. (b) Determine the critical path and the normal duration and cost of the project. (c) Crash the activities so that the project completion time reduces to 9 weeks. SOLUTION As the problem involves direct cost we expect that the project duration can be reduced with increase in total cost. First we draw the network. Critical path 1-3-5-6; Normal duration = 16 weeks Total cost = RS. 82,000 The calculation of cost slope and crashing number of days are shown in the table below: Activity 1-2 1-3 2-4 3-4 3-5 4-6 5-6 The different paths of the network are First crashing We crash the activity 1-3 as it is the critical activity with minimum rank. We crash this activity for 3 weeks at the rate of Rs. 2 (1000) per day. Project duration reduced to 16-3 = 13 weeks Total cost = 82 + 3x 2 = 88 (RS. 1000) Second Crashing Next we crash the activity 5-6 for 2 weeks at the rate of Rs. 6 (1000) per week as this activity has the next minimum rank. Project duration reduced to 13-2 = 11 weeks Total cost = 88 + 12 x 6 = Rs. 100 (1000) Slope (Rs. 1000 ) 5 (1) IV 2 (3) I 4 (1) III 0 7 (1) VI 3 (2) II 6 (4) V

40

Third Crashing After 11 days we get all the paths critical. As three is no activity in common, we crash the activity 5-6 for 2 weeks in the paths 1-3-5-6 crash the activity 4-6 for 2 weeks which is common to the paths 1-3-4-6 and 1-2-4-6. Project duration reduced to 11-2 = 9 weeks Total cost = 100+2x6+2x3=118 (RS. 100) The project duration cant be reduced beyond 9 weeks as all the activities are in crash time. Hence, the optimum duration is 9 weeks with the total cost associated Rs. 118 (1000).

9.11 PROGRAMME EVALUATION AND REVIEW TECHNIQUE (PERT)

The network methods discussed so far may be termed as deterministic, since estimated activity times are assumed to be known with certainty. However, in research project or design of gear box or a new machine, various activities are based on judgment. It is difficult to obtain a reliable time estimate due to the changing technology. Time values are subject to chance variations. For such cases where the activities are non-deterministic in nature, PERT was developed. Hence, PERT is a probabilistic method where the activity times are represented by a probability distribution. This probability distribution of activity times is based upon three different time estimates made for each activity. These are as follows.
(i) Optimistic time estimate (ii) Most likely time estimate (iii) Pessimistic time estimate

Optimistic time estimate It is the smallest time taken to complete the activity if everything goes on well. There is very little chance that activity can be done in time less than the optimistic time. It is denoted by to. or a. Most likely time estimate It refers to the estimate of the normal time the activity would take. This assumes normal delays. It is the mode of the probability distribution. It is denoted by tm. Pessimistic time estimate It is the longest time that an activity would take if everything goes wrong. It is denoted by tp or b. These three time values are shown in the following figure 1.

41

Fig. 1 Time distribution curve From these three time estimates, we have to calculate the expected time of an activity. It is given by the weighted average of the three time estimates = t o + 4t m + t p 6

Where t p , t o and t m are pessimistic, optimistic and most likely time estimates respectively.

Variance of the activity is given by

tp to = 6
2

The range for the time estimates is from t p to t o . The most likely time will be anywhere in the range from t p to t o . The expected project completion time is i , where i is the expected duration of the ith critical activity. The variance of the project completion time is variance of the ith critical activity in the critical path. As a part of statistical analysis, we may be interested in knowing the probability of completing the project on or before a given due date (C) or we may be interested in knowing the expected project completion time if the probability of completing the project is given. For this, the beta distribution is approximated to standard normal distribution whose statistic is given below:

where 2 i is the

z=

where x is the actual project completion time, is the expected project completion time (sum of expected durations of the critical activities) and is the standard deviation of the expected project completion time (square root of the sum of the variances of all the critical activities). Therefore
P(x C ) ) represents the probability that the project will be completed on or before the C time u This

42

can be converted into the standard normal statistic z as:

C x C P = P z
Example 9.13 Consider Table 1 summarizing the details of a project involving 11 activities

Table 1 Details of Project with 11 Activities

b

Activity

Predecessor(s) to

Duration (weeks)
tm

tp 8 9 7 3 9 9 8 4 10 14 8

A
B

__ __ __
D

6 1 1 1 1 1 2 4 4 2 2

7 2 4 2 2 5 2 4 4 5 5

C E F G H 1 J
K

A A, B C C E,F E, F D, H I,G

(a) (b) (c) (d) (e)

Construct the project network. Find the expected duration and variance of each activity. Find the critical path and the expected project completion time. What is the probability of completing the project on or before 25 weeks? If the probability of completing the project is 0.84, find the expected project completion t

Solution (a) The project network is shown in Figure 1.

43

Figure 1 Network for Example 1. (b) The expected duration and variance of each activity are shown in Table 1.
Table 2 Computations of Expected Duration and Variance

Activity A
B

to 6 1 1 1 1 1 2 4 4 2 2

Duration (weeks) tm tp 7 2 4 2 2 5 2 4 4 5 2 8 9 7 3 9 9 8 4 10 14 8

Mean duration 7 3 4 2 3 5 3 4 5 6 3

Variance

C
D
E

F G 1 J
H

0.11 1.78 1.00 0.11 1.78 1.78 1.00 0.00 1.00 4.00 1.00

(c) The calculations of critical path based on expected durations are summarized in Figure

2. The critical path is A-DI E-F-J and the corresponding project completion time is 20 weeks.

44

*D1 Dummy activity

Figure 2 Network for Example 1

(d) The sum of the variances of all the activities on the critical path is:

0.11 + 1.78 + 0.00 + 4.00 = 5.89 weeks. Therefore = 5.89 = 2.43 weeks. Also

x 25 20 P(x 25) = P = P(z 2.06) = 0.9803. 2.43 This value is obtained from standard normal table. Therefore, the probability of completing the project on or before 25 weeks is 0.9803. (e)We also have P(x C ) = 0.84 . Therefore,
x C P = 0.84 C 20 P z = 0.84 2.43 From the standard normal table, the value of z is 0.99, when the cumulative probability is 0.84. Therefore,

C 20 = 0.99 2.43

or C = 22.4weeks

45

The project will be completed in 22.41 weeks (approximately 23 weeks) if the probability of completing the project is 0.84.
Example 2 Consider the data of a project summarized in Table 3. Table 3 Data of Example 2

Activity

Predecessor(s)

Duration (weeks) to
tm

tp 10
B

A
B

__ __ __ A 1 A

4 1 2

4 2 5 4

C
D

14 7 3 9 9 4 8 8

1 1 1 4 2 6 2 7

2 5 2 4

F
G H

A B,C C D E,G Construct the project network.

I J

(a) (b) (c) (d)

Find the expected duration and the variance of each activity. Find the critical path and the expected project completion time. What is the probability of completing the project on or before 35 weeks?

Solution

46

*D1 Dummy activity

Figure 3 Network for Example 2
(a)

The mean and variance of each activity in the project are shown in Table 4 Table 4 Data of Example 2 Acti Imm ediate predece ssor(s) A B C __ __ __ A E A 4 1 2 1 1 4 0 2 5 4 4 2 9 1 7 3 3 6 4 2 1.78 4.00 1.00 0.11 1 5 1.00 Duration (weeks) to to to

vity

Mean duration(wee ks)

Varian ce(weeks )

47

F G H 1 J

A B,C C D E, G 6

1 1 4 2 7

5 2 4 2 8

9 9 4 8 7

5 3 4 3

1.78 1.78 0.00 1.00 0.11

(c) The critical path calculations are shown in Figure 4. From Figure 4, the critical path is CD1GJ and the corresponding expected project completion time is 16 weeks.

Fig .4 Project network with critical path calculations. (e)The probability of corresponding the project on or before 35 weeks is computed as shown below. The sum of the variance of the critical activities = 4+1.78+0.11= 5.89weeks Therefore, the standard deviation, = 5.89 = 2.43 weeks.
x 35 16 Also P(x 35) = P = P(z 7.82) = 0.9999. 2.43

48

EXERCISES

1.Define 'project', and give some application areas of project management. Explain different phases of project management. 2. Distinguish between CPM and PERT. 3. Discuss the guidelines for constructing a project network. 4. Define the following: (a) total float, (b) free float, and (c) critical path. 5. What are the time estimates used in PERT? 6. Discuss the cost trade-off in project crashing. 7. Distingush between resource levelling and resource allocation. 8. A construction company has listed down various activities that are involved in constructing a building. These are summarized along with predecessor(s) details in the table 9.##. Table 9.## Activity A B C D E F G H I J K L M Draw a project network for the above project. 9. Consider the details of a project as shown in the table 9.##: TABLE 9.## Activity Immediate predecessor(s) Duration (months) Immediate predecessor(s) __ __ A B A, B C, D F, B E, G H, G I, F J, L A K

49

A B C D E F G H I J K L M N O P Q

__ __ __ A A B B C C D E F G H 1 J, K, L M, N, 0

4 8 5 4 5 7 4 8 3 6 5 4 12 7 10 5 8

(a) Construct the CPM network. (b) Determine the critical path. (c) Compute total floats and free floats for non-critical activities. 10.The following table gives data on normal time and Cost and crash time and cost jor, project: Activity 1-2 1-3 2-4 2-5 3-4 4-6 5-6 6-7 6 4 5 3 6
8

Normal Time(days) Cost(Rs.) 60 60 50 45 90

80

Crash Time(days) 4 2 3 1 4 4 2 2 Cost(Rs.) 100 200 150 65 200 300 100 80

4 3

40 45

50

Total cost(Rs.)

470

The indirect cost per day is Rs. 10.

(i) Draw the network for the project. (ii) Find the critical path. (iii) Determine minimum total time and corresponding cost.

11.The following table gives data on normal time and cost and crash time and cost for a project.
(a) Draw the network and identify the critical path. (b) What is the normal project duration and associated cost? (c) Find out total float for each activity. (d) Crash the relevant activities systematically and determine the optimum project time and cost.

Activity 1-2 2-3 2-4 2-5 3-5 4-5 5-6 6-7 6-8 7-8 3 3 7 9 5 0 6 4 13 10 Total cost(Rs.)

Normal Time(weeks) Cost(Rs.) 300 30 420 720 250 0 320 400 780 1,000 4,220 2 3 5 7 4 0 4 3 10 9

Crash Time(weeks) Cost(Rs.) 400 30 580 810 300 0 410 470 900 1,200

Indirect costs are Rs. 50 per week.

12. A project schedule has the following characteristics. Activity Time(days) 1-2 4 1-3 1 2-4 1 3-4 1 3-5 6 4-9 5 5-6 4 5-7 8 6-8 7-8 8-10 9-10 1 2 5 7

From the above information, you are required to (i) Construct a network diagram. (ii) Compute the earliest event time and latest event time

51

(iii) Determine the critical path and total project duration (iv) Compute total, free float for each activity.
13.The following Table shows the job of a project with their duration in days. Draw the network and

determine the critical path. Also calculate all the free floats of each activity. Job 9-10 15 1-2 1-3 8 1-4 9 11-12 5 2-5 8 3-7 16 4-6 7 5-7 7 5-8 7 6-7 6-97-10 8-10 8 5 12 10 Duration(days)10 8

10-11

14. The activities involved in Alpha Garment Manufacturing Company are listed with their time estimates as in the following table:

Activity Description A B C D E F G Forecast sales volume Study competitive market Design item and facilities Prepare production plan Estimate cost of production Set sales price Prepare budget

Immediate predecessor(s) __ __ A C D B, E F

Duration(days) 10 7 5 3 2 1 14

Draw the network for the given activities and carry out the critical path calculations. 15. Consider the following data of a project. Activity Predecessor(s) a Duration (weeks) m b

52

A B C D D E F G H

__ __ A C B A C, D C, D, E F

3 6 4 A 3 4 5 3 1

5 7 5 4 5 6 8 6 2

8 9 9 5 8 9 11 9 9

(a) Construct the project network. (b) Find the expected duration and variance of each activity. (c) Find the critical path and the expected project completion time. (d) What is the probability of completing the project on or before 30 weeks? (e) If the probability of completing the project is 0.9, find the expected project completion time. 16. Consider the following table summarizing the details of a project: Activity A B C D E F G H 1 J K L M N Predecessor(s) a __ __ __ A A A B, C C D E, G F, H F, H 1, J, K L 4 1 2 1 1 1 1 4 2 6 2 5 1 6 4 2 5 4 2 5 2 4 2 7 2 5 2 7 Duration (weeks) m 10 9 14 7 3 9 9 4 8 8 8 5 9 8 b

53

(a) Construct the project network. (b) Find the expected duration and variance of each activity. (c) Find the critical path and the expected project completion time. (d) What is the probability of completing the project on or before 35 weeks'? (e) If the probability of completing the project is 0.85, find the expected project completion time. 17. Consider the following data of project. Activity 1-2 1-3 2-3 2-4 2-5 3-4 3-5 4-5 7 11 10 6 16 6 9 8 Normal Time (weeks) Cost (Rs.) 600 200 800 500 100 200 500 300 Time (weeks) 4 9 8 4 9 4 4 5 Crash Cost (Rs.) 840 First week: Rs. 70 Second week: Rs. 80 1000 760 380 360 960 500

If the indirect cost per week is Rs. 300, find the optimal crashed project completion time.

18. Consider the data of a project as shown in the following table: Activity 1-2 1-3 1-4 2-5 3-5 3-6 4-6 8 5 9 10 5 6 7 Normal Time (weeks) Cost (Rs.) 800 500 600 900 700 1200 1300 5 3 6 8 3 5 5 Crash Time (weeks) Cost (Rs.) 950 700 1050 1300 1100 1500 1400

54

5-7 6-7

2 4

400 500

1 2

500 900

If the indirect cost per week is Rs. 300, find the optimal crashed project completion time. 19. Consider the problem of project scheduling as shown in the following table: Activity 1-2 1-3 2-3 2-4 3-4 3-5 4-5 Duration (weeks) 4 8 10 6 9 5 7 Manpower requirement 9 5 7 6 8 12 7

Obtain a schedule which will minimize the peak manpower requirement and also smooth out period-toperiod variation of manpower requirement. 20. Consider the problem of project scheduling as shown in the following table: Activity 1-2 1-3 1-4 2-4 2-5 3-5 4-6 5-6 Duration (weeks) 5 4 6 10 4 4 8 9 Manpower requirement 8 10 8 10 7 4 12 6

Obtain a schedule which will minimize the peak manpower requirement and also smooth out period-toperiod variation of manpower requirement. 21. Consider the network scheduling problem as shown in the following table: Activity 1-2 1-3 6 4 Duration (weeks) 10 6 Manpower requirement

55

1-4 2-6 3-6 4-6 6-7

9 5 8 2 7

8 4 7 5 4

Schedule the activities of the project with a maximum limit on the manpower requirement as 15. 22. The table below provides cost and time estimates of seven activities of a project. Activity 1-2 1-3 2-4 3-4 3-5 4-6 5-6 2 8 4 1 2 5 6 Time estimates Normal Crash 1 5 3 1 1 3 2 Direct cost estimates Normal 10 15 20 7 8 10 12 Crash 15 21 24 7 15 16 36

(i) Draw the project network corresponding to normal time. (ii) Determine the critical path and the normal duration and normal cost of the project. (iii) Crash the activities so that the project completion time reduces to 9 weeks, with minimum additional cost. 23. Table below shows jobs, their normal time and cost and crash time and cost estimates for a project. Job 1-2 1-3 2-3 2-4 3-4 3-5 4-6 5-6 Normal time(days) 6 8 4 3 Dummy 6 10 3 Cost(Rs.) 1,400 2,000 1,100 800 __ 900 2,500 500 Crash time(days) 4 5 2 2 __ 3 6 2 Cost(Rs.) 1,900 2,800 1,500 1,400 __ 1,600 3,500 800

56

9,200 Indirect cost for the project is Rs. 300 per day. (i) Draw the network of the project. (it) What is the normal duration and cost of the project ? (iii) If all activities are crashed, what will be the minimum project duration and corresponding cost ? (iv) Find the optimal duration & minimum project cost. (Ans. (ii) 20 days, Rs. 15,200 (iii) 12 days, Rs. 16,534.34 (iv) 17 days ; Rs. 15,000.) 24. The following time-cost table (time in weeks, cost in rupees) applies to a project. Use it to arrive at the network associated with completing the project in minimum time at minimum cost. Activity Time (weeks) 1-2 1-3 1-4 2-4 2-5 3-4 3-5 4-5 2 5 5 1 5 4 6 3 Normal Cost (Rs.) 800 1,000 1,000 500 1,500 2,000 1,200 900 Time (weeks) 1 2 3 1 3 3 4 2 Crash Cost (Rs.) 1,400 2,000 1,800 500 2,100 3,000 1,600 1,600

(Ans. Crash activity 1-3 by 3 weeks, 4-5 by 1 week and 3-4 by 1 week, giving an optimal 7-weeks duration project at a cost of Rs. 11,800.) 25. The utility data for a network is given below. Crash the network to minimum project duration and determine the project cost for that duration. Activity 0-1 1-2 1-3 1 3 7 Normal Time (weeks) Cost (Rs.) 5,000 5,000 11,000 1 2 4 Crash Time (weeks) Cost (Rs.) 5,000 12,000 17,000

57

2-3 2-4 3-4 4-5

5 8 4 1

10,000 8500 8,500 5,000

3 6 2 1

12,000 12,500 16,500 5,000

(Ans. 10 days, Rs. 74,000.) S. Consider a network problem for which the utility data are given in the table. Crash systematically the activities and determine the optimum project duration and cost.

Activity

Normal Ttime (days) Cost (Rs.) 100 150 50 100 100 80 580 6 2 1 5 1 1

Crash Time (days) Cost (Rs.) 200 350 90 400 200 100 2 2 1 5 4 2

T C

1-2 1-3 2-4 2-5 3-4 4-5

8 4 2 10 5 3 Total

100 200 40 300 100 20

50 100 40 60 25 10

Indirect cost Rs. 70 per day.(Ans. 11 days; Rs. 1,760.) 26. The utility data for a network is given in the table. Crash the network to minimum possible duration, and find the corresponding optimal project cost. The total normal cost of the project is Rs. 9,00,000 only. Activity 1-2 1-3 Duration (weeks) Normal 4 7 Crash 2 4 Cost slope (Thousands of Rs.) 7 4

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2-3 2-4 3.-5 4-5 4-6 5-6 5-7 6-8 7-8

7 5 6 4 10 6 8 6 5

4 3 3 1 6 6 6 4 2

3 12 6 8 10 __ 10 12 7

10. The activity data for a project is given in the table. Find the (a) normal duration and the normal cost. (b) optimal duration and the minimum total cost. (c) minimum duration and the associated project cost. Activity
Time (weeks) 1-2 1-3 2-3 2-5 3-4 4-6 5-6 5-7 6-8 7-8 7-9 8-9 8 4 0 6 7 12 15 7 5 14 8 6 Total

Normal
cost (Rs.) 7,000 6,000 0 9,000 2,500 10,000 12,000 12,000 10,000 6,000 6,000 6,000 86,500 Time

Crash
cost (Rs.) 10,000 8,000 0 11,500 3,000 16,000 16,000 14,000 10,000 7,400 12,000 7,800 5 2 0 5 2 4 5 1 0 7 3 2 (weeks) 3 2 0 1 5 8 10 6 5 7 5 4

T C

3,000 2,000 0 2,500 500 6,000 4,000 2,000 0 1,400 600 1,800

600 1,000 0 500 250 1,500 800 2,000 __ 200 2,000 900

Total 1,15,700

Indirect cost Rs. 1,000 per week. (Ans. (a) 41 days; Rs. 1,27,500 (b) 30 days; Rs. 1,25,700 (c) 25 days; Rs. 1,32,700.)

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27. (a) The following data pertains to a CPM network. It is desired to compress the project to the least possible duration day by day and estimate the extra cost. Activity 1-2 1-3 2-3 2-4 3-4 Normal time 3 7 5 8 4 Crash time 2 4 3 6 2 Cost slope 700 200 100 200 400

(b) If there is an indirect cost of Rs. 800 per day, what will be the least project duration and the associated cost ? (Ans. (a) 8 days, Rs. 2,100; (b) 9 days, Rs. 8,400.) 28. A small maintenance project consists of jobs in the table below. With each job is listed its normal time and a minimum or crash time in days. The cost in Rs. per day of each job is also given. Activity 1-2 1-3 1-4 2-4 3-4 4-5 Normal time 9 9 15 5 10 2 Crash time 6 5 10 3 6 1 Cost slope 20 25 30 10 15 40

(a) What is the normal project length and the minimum project length ? (b) Determine the minimum crashing cost of schedules ranging from normal length down to, and including, the minimum length schedule. That is, if L = length of the schedule, find the costs of schedules which are L, L - 1, L - 2 and so on. (c) Overhead costs total Rs. 60 per day. What is the optimum length schedule in terms of both crashing and overhead cost? List the scheduled duration of each job for your solution. (Ans. (a) 20 days, 12 days; (b) 12 days, Cc = Rs. 335, C7, = Rs. 1,055 (c) 15 days.) 29. The utility data fora network is given below. The activity durations are in days and the cost in

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rupees. The indirect cost per day is Rs. 250. Determine the optimum project schedule. Activity 1-2 1-3 2-4 2-5 3-5 3-7 4-5 5-6 5-7 6-8 7-8 4 2 6 4 5 10 5 8 0 7 8 Normal Time (weeks) cost (Rs.) 600 500 1,000 1,200 1,000 2,500 1,300 2,000 0 2,000 1,600 2 1 3 4 3 5 5 6 0 7 5 Crash Time (weeks) cost (Rs.) 800 900 1,750 1,200 1,200 3,500 1,300 2,100 0 2,000 1,780

(Ans. Crash 1-2 by 2 days, 2-4 by 1 day, 5-6 by 2 days; Rs. 13,000, 25 days.) 30. Following table gives the activities in a construction project and other relevant information: Activity A B C D E F G Days 15 Predecessor __ __ __ A C A D, B, E 14 4 6 2 5 2 7 4 8 50 7 35 Time (days) Normal Crash 3 4 1 3 2 5 2 6 25 Direct cost (Rs.) Normal 60 150 38 150 100 115 100 Crash 90 250 60 250 100 175 240

Indirect costs vary as follows 13 12 11 10 9 Cost (Rs.)600 500 400 250 175 100 75

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(a) Draw an arrow diagram for the project. (b) Determine the project duration which will return in minimum total project cost.

31. A Project has 7 activities. The relevant data is given below. Activity A B C D E F G Predecessor Normal __ A A A B, C C, D E, F 7 4 5 6 7 5 6 Time (days) Crash 5 2 5 4 4 2 4 500 400 500 800 700 800 800 Direct cost (Rs.) Normal Crash 900 600 500 1,000 1,000 1,400 1,600

The project manager wishes to complete the project in the minimum possible time. However, he is not authorised to spend more than Rs. 5,000 on crashing. Suggest the least cost schedule. Assume that there is no indirect or utility cost. (Ans. 14 weeks, cost: Rs. 4,600.) 32. The time and cost estimates of different activities of a project and their precedence relationships are given below. Activity A B C D E F Predecessor Normal __ __ A B B C, D 6 4 3 8 14 8 Time (weeks) Crash 4 3 2 3 6 4 Normal 10,000 5,000 4,000 1,000 9,000 7,000 Direct cost (Rs.) Crash 14,000 8,000 5,000 6,000 13,000 8,000

Overhead costs amount to Rs. 1,000 per week. (i) Draw the network and show the critical path. (ii) Crash the network to the minimum possible duration. What will be the critical activities after such

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crashing? (Ans. (i) B-D-F (ii) 10 weeks; A-C-F, B-D-F.) 33. The basic cost-time data for jobs in a project are giver. below. Job A B C D E F G H 3 6 2 4 2 7 4 3 Normal Time (days) Cost(Rs.) 140 215 160 130 170 165 210 110 2 5 1 3 1 4 3 2 Crash Time(days) Cost(Rs.) 210 275 240 180 250 285 290 160 Crashing cost per day(Rs./day) 70 60 80 50 80 40 80 50

The activities dependencies are as below: (i) A, B, C are starting activities (ii) Activities D, E and F can start when A is completed, (iii) C can start after B and D are completed, (iv) H can start after C and E are completed, (v) G, H and F are final activities. Draw the network and indicate the critical path and the total time of completing the project. If the project is to be completed in 8 days, what is the minimum cost to be incurred? Indicate this cheapest schedule. 34. A list of activities along with their precedence requirement, normal time and cost and crash time and cost are given in the table below. Activity A B C D E F G Predecessor __ A A B B, D C, D E, F 4 9 6 4 6 4 3 Normal Time (days) Cost(Rs.) 300 600 620 320 1440 350 270 Time (days) 2 5 4 3 3 2 2 Crash Cost(Rs.) 450 960 780 395 1,980 470 335

(a) Draw the network.

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(b) What are the normal and crash costs and durations of the project ? How many days will be saved and what will be the project cost if all the activities are crashed to the maximum possible extent ? It is expected that earlier completion of the project will result in additional profit of Rs. 50 per day. The indirect cost is Rs. 80 per day. (c) Analyse the project for optimum duration cost.