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Project

Management
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What is a Project?
Project
An interrelated
set of
activities with
a definite
starting and
ending point,
which results
in a unique
outcome for a

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What is Project
Management?
Project
Management
A systemized,
phased
approach to
defining,
organizing,
planning,
monitoring,

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Defining and Organizing


Projects
Defining the Scope and Objectives
Selecting the Project Manager
and Team
Recognizing Organizational
Structure
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Planning Projects
Defining the Work Breakdown
Structure
Diagramming the network
Developing the schedule
Analyzing cost-time
trade-offs
Assessing risks
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Work Breakdown
Structure
Work Breakdown Structure
A statement of all the work that
has to be completed.
Activity
The smallest unit of work effort
consuming both time and
resources that can be planned
and controlled.
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Work Breakdown
Structure

Relocation of St. Johns HospitalLevel 0

Level 1
Organizing and Site Preparation
Physical Facilities and Infrastructure
Select administration staffPurchase and deliver equipment
Site selection and survey
Select medical equipment

Construct hospital
Develop information systemLevel 2

Prepare final construction plansInstall medical equipment


Bring utilities to site

Train nurses and support staff

Interview applicants
for
and
support
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02 -07

Diagramming the
Network
Program Evaluation and Review
Technique (PERT)
Critical Path Method (CPM)

Activity-on-Node approach
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02 - 08

Establishing Precedence Relationships


Precedence
Relationships
Determining the
sequence for
undertaking
activities.

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Example 2.1

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Example 2.1
Immediate
Predecessor
A

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

Start

Finish

E
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02 - 11

Application 2.1
The following information is known about a project

Activity

Activity Time (days)

Immediate
Predecessor(s)

B, C

Draw the network diagram for this project


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02 - 12

Application 2.1
Activity

Activity Time (days)

Immediate
Predecessor(s)

B, C

B
2
Start

A
7

F
3
D
4

E
4

C
4

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Finish
G
5

02 - 13

Developing the Schedule


Path
The sequence of activities
between a projects start and
finish.
Critical Path
The sequence of activities
between a start and finish that
takes the longest time to
complete.
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02 - 14

Developing the Schedule


Earliest start time (ES) - the latest
earliest finish time of any immediately
preceding activities
Earliest finish time (EF) - the earliest
start time plus its estimated duration
Latest
EF = ESfinish
+ t time (LF) the earliest of the
latest start times of any of the
immediately following activities.
Latest start time (LS) - the latest finish
minus its estimated duration
LS =
time
Activity Slack - the maximum length of
LF t
time an activity can be delayed without
delaying the entire project
LF-EF
or LS-ES
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Developing the Schedule


Activity
Earliest start time

0
Latest start time

12

Earliest finish time

12
14

Latest finish
time

Duration

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Example 2.2
Paths are the
sequence of
activities between a
projects start and
finish.

Start

Path
Time (wks)
A-I-K
A-F-K
A-C-G-J-K
B-D-H-J-K
B-E-J-K

33
28
67
69
43

Finish

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Example
2.2
Earliest start time

12

27

Earliest finish time

15

0 A 12

12

12

Start

22 22

10
B
9

D 19 19
10

69

10

12

63

22

57

Finish

35
H
40

59 59

J
4

9 E
33

24

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63

Example
2.2
0

12

I
15

12 12

12

Start

22 22

D 19 19

69

57

Finish

35
H

59 59

40

10

K
6

10
B

63

22

10

12

The Critical
Path takes 69
weeks

27

J
4

33

24
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02 - 19

63

Latest finish time

Example
2.2
Latest
start time
0
2

12
48
15
63

12 12
12 14 53

12
14

Start

0
0

B
9

9
9

9
9

F
10
C
1
0

27

63
63

22
63

22 22 G
24 24

35

K
6

69
69

57
59

Finish

19 19
59 59
10 19 19 40 59 59

63

63

E 33

3524
59
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02 - 20

Example
2.2
S=
2 0

S=
36

12
48

I
15

27
63

S=
22
41

12 12 F
2 12 14 53
10 63

S = 12
2 14

Start

S=
0

B
0 9
9

C
1
0

S=
D
9 09
9

63
63

S=
2
22 22 G
24 24

35

S=
0
H
19 19

10 19 19 40

S=
K 0 69
6

69

57
59

Finish

59 59
59 59

J
4

E 33
9
S=
26 35 24 59
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02 - 21

63
S=
63

Developing a Schedule
Gantt chart

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Application 2.2
Calculate the four times for each activity in order to
determine the critical path and project duration for
the diagram in Application Problem 1.
Activit
y

Duratio
n

Earlies Latest
t Start Start
(ES)
(LS)
0

Earlies
t
Latest
Finish Finish
(EF)
(LF)
7

Slack
(LSES)
0-0=0

On the
Critica
l Path?
Yes

e criticalFpath is3 ACDEG with a project duration of 24 days.


G

5
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Prentice Hall

Application 2.2
Calculate the four times for each activity in order to
determine the critical path and project duration.
Activit
y

Duratio
n

Earlies Latest
t Start Start
(ES)
(LS)
0
7
7
11
15
19
19

0
9
7
11
15
21
19

Earlies
t
Latest
Finish Finish
(EF)
(LF)
7
9
11
15
19
22
24

7
11
11
15
19
24
24

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Slack
(LSES)
0-0=0
9-7=2
7-7=0
11-11=0
15-15=0
21-19=2
19-19=0

02 - 24

On the
Critica
l Path?
Yes
No
Yes
Yes
Yes
No
Yes

Application 2.2

ritical path is ACDEG with a project duration of 24

B
2
Start

A
7

F
3
D
4

C
4

E
4

Finish
G
5

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Analyzing Cost-Time
Trade-Offs
Project Crashing
Shortening (or
expediting) some
activities within a
project to reduce
overall project
completion time.

Project Costs
Direct Costs
Indirect Costs
Penalty Costs
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Analyzing Cost-Time
Trade-Offs
Project Costs
Normal time (NT) is the
Cost to crash per
time necessary to
period =
complete an activity
CC NC
under normal
NT CT
conditions.
Normal cost (NC) is the
activity cost associated
with the normal time.
Crash time (CT) is the
shortest possible time
to complete an activity.
Crash cost (CC) is the
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activity cost
associated
Prentice Hall

Cost-Time Relationships
Direct cost (dollars)

8000
7000

Crash cost (CC)


Linear cost assumption

6000

Estimated costs
for a 2-week
reduction, from
10 weeks to
8 weeks

5200
5000
4000
3000

Normal cost (NC)


0

|
5

|
6

|
7

|
9

|
|
10 11

(Crash time)
(Normal time)
Time (weeks)
Figure 2.6

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Analyzing Cost-Time
Trade-Offs
Determining the Minimum Cost Schedule:
1. Determine the projects critical path(s).
2. Find the activity or activities on the critical
path(s) with the lowest cost of crashing per week.
3. Reduce the time for this activity until
a. It cannot be further reduced or
b. Until another path becomes critical, or
c. The increase in direct costs exceeds the savings
that result from shortening the project (which
lowers indirect costs).
4. Repeat this procedure until the increase in direct
costs is larger than the savings generated by
shortening the project.
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02 - 29

Example 2.3
DIRECT COST AND TIME DATA FOR THE ST. JOHNS HOSPITAL PROJECT
Activity

Normal
Time (NT)
(weeks)

Normal
Cost (NC)
($)

Crash Time
(CT)
(weeks)

Maximum
Time
Reductio
n (week)

12

10

10

24

10

35

40

Inc. publishing
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$12,000
50,000
4,000
16,000
120,000
10,000
500,000
1,200,000

11

Crash Cost
(CC)($)

$13,000

Cost of
Crashing per
Week ($)

1,000

64,000

7,000

7,000

600

20,000

2,000

10

8,000

1,500

10

3,000

12,000

14
6
25
35

200,000
16,000

530,000
1,260,000

2,500

Example 2.3
Determine the minimum-cost schedule for
the St. Johns Hospital project.
Project completion time =69 weeks.
Project cost = $2,624,000
Direct = $1,992,000
Indirect = 69($8,000) = $552,000
Penalty = (69 65)($20,000) = $80,000
AIK

33 weeks

AFK

28 weeks

ACGJK

67 weeks

BDHJK

69 weeks

BEJK

43 weeks

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Example 2.3
STAGE 1
Step 1. The critical path is BDHJK.

Step 2. The cheapest activity to crash per week


is J at $1,000, which is much less than the
savings in indirect and penalty costs of $28,000
per
Stepweek.
3. Crash activity J by its limit of three
weeks because the critical path remains
unchanged. The new expected path times are
ACGJK: 64 weeks
BDHJK: 66 weeks
The net savings are 3($28,000) 3($1,000) =
$81,000. The total project costs are now
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$2,624,000
- $81,000
$2,543,000.
02 - 32
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Example 2.3
I
15

STAGE 1
A
12

Start
B
9

F
10

K
6

C
10

G
35

D
10

H
40

Finish
J
1

E
24
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Prentice Hall

Example 2.3
STAGE 2
Step 1. The critical path is still BDHJK.
Step 2. The cheapest activity to crash per week

is now D at $2,000.
Step 3. Crash D by two weeks.
The first week of reduction in activity D saves
$28,000 because it eliminates a week of
penalty costs, as well as indirect costs.
Crashing D by a second week saves only
$8,000 in indirect costs because, after week
65, no more penalty costs are incurred.
Updated path times are
ACGJK: 64 weeks and BDHJK: 64 weeks
The netCopyright
savings
are $28,000
+ $8,000

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Prentice
2($2,000)
=Hall
$32,000.

Example 2.3
I
15

STAGE 2

A
12

Start

B
9

F
10

K
6

C
10

G
35

D
8

H
40

Finish

J
1

E
24
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02 - 35

Example 2.3
STAGE 3
Step 1. The critical paths are BDHJK and A-C-G-J-

Step 2. Activities eligible to be crashed:

(A, B); (A, H); (C, B); (C, H); (G, B); (G, H) or
to crash Activity K
We consider only those alternatives for which
the costs of crashing are less than the
potential savings of $8,000 per week.
Step
We3.choose activity K to crash 1 week at
per week.
$4,000
Updated path times are: ACGJK: 63 weeks
and BDHJK: 63 weeks
Net savings are $8,000 - $4,000 = $4,000.
Total project
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$2,511,000
$4,000
=
02 - 36
Prentice Hall
$2,507,000.

Example 2.3
I
15

STAGE 3

A
12

Start

B
9

F
10

K
5

C
10

G
35

D
8

H
40

Finish

J
1

E
24
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02 - 37

Example 2.3
STAGE 4
Step 1. The critical paths are still BDHJK and ACGJK.

Step 2. Activities eligible to be crashed: (B,C) @

$7,600 per week.

Step 3. Crash activities B and C by two weeks.

Updated path times are


ACGJK: 61 weeks and BDHJK: 61 weeks
The net savings are 2($8,000) 2($7,600) =
$800. Total project costs are now $2,507,000
$800 = $2,506,200.
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Prentice Hall

Example 2.3
I
15

STAGE 4
A
12

Start

B
7

F
10

K
5

C
8

G
35

D
8

H
40

Finish

J
1

E
24
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02 - 39

Example 2.3
Stage

Crash
Activity

Time
Reduction
(weeks)

Resulting
Critical
Path(s)

Project
Duration
(weeks)

Project
Direct
Costs,
Last Trial
($000)

B-D-H-JK

69

1,992.0

B-D-H-JK

66

1,992.0

B-D-H-JK
A-C-G-JK

64

1,995.0

B-D-H-JK
A-C-G-JK

63

1,999.0

B, C

B-D-H-JK
A-C-G-JK

61

2,003.0

Crash
Cost
Added
($000)

3.0
4.0

4.0

15.2

Total
Indirect
Costs
($000)

552.0
528.0
512.0

504.0

488.0

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Total
Penalty
Costs
($000)

80.0
20.0
0.0

0.0

0.0

Total
Project
Costs
($000)

2,624.0
2,543.0
2,511.0

2,507.0

2,506.2

Application 2.3
Indirect project costs = $250 per day
Penalty cost = $100 per day past day 14.
Project Activity and Cost Data
Normal
Activi Time
ty
(days)

Normal
Cost
($)

Crash
Time
(days)

800

600

5
Prentice Hall

1,000

1,500

Crash
Cost
($)

1,200

2,000

A, B

900

2,000

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900

Immediate
Predecessor
(s)

02 - 41

C, D

Application 2.3
5
6

C
2

7
8
ES ID EF
LS

0
1

A
5

5
6

13
19

8
8

Start

0
0

B
5

5
5

5
5

D
3

8
8

E
5

F
2

DUR

LF

15
21

13
13

Finish

13
13

G
3

16
16

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16
16

H
5

21
21

02 - 42

Application 2.3
Project Activity and Cost Data
Activit
y

Crash Cost/Day

Maximum Crash Time


(days)

200

600

300

500

150

100

H Total 200
2
Normal
Costs = $7,500
$250
Total Indirect Costs
= per day 21 days = $5,250
Penalty Cost =
$100 per day 7 days = $700
Total Project Costs =
$13,450
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Application 2.3
Step 1: The critical path is BDEGH , and the project
duration is 21 days.
Step 2: Activity E on the critical path has the lowest cost of
crashing ($150 per day). Note that activity G cannot be
crashed.
Step 3: Reduce the time (crashing 2 days will reduce the
project duration to 19 days) and re-calculate costs:
Normal Costs Last Trial = $7,500
$150 2 days = $300
Crash Cost Added =
$250 per day 19 days = $4,750
Total Indirect Costs =
$100 per day 5 days = $500
Penalty Cost =
$13,050
Total Project Cost =

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02 - 44

Application 2.3
Step 4: Repeat until direct costs greater than savings
(step 2) Activity H on the critical path has the next lowest cost
of crashing ($200 per day).
(step 3) Reduce the time (crashing 2 days will reduce the
project duration to 17 days) and re-calculate costs:
Costs Last Trial = $7,500 + $300 (the added crash costs) = $7,800
Crash Cost Added = $200 2 days = $400
Total Indirect Costs = $250 per day 17 days = $4,250
Penalty Cost = $100 per day 3 days = $300
Total Project Cost = $12,750

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02 - 45

Application 2.3
(step 4) Repeat
(step 2) Activity D on the critical path has the next lowest
crashing cost ($500 per day).
(step 3) Reduce the time (crashing 1 day will reduce the project
duration to 16 days) and re-calculate costs:
Costs Last Trial = $7,800 + $400 (the added crash costs) = $8,200
Crash Cost Added = $500 1 day = $500
Total Indirect Costs = $250 per day 16 days = $4,000
Penalty Cost = $100 per day 2 days = $200
Total Project Cost = $12,900 which is greater than the last trial.
Hence we stop the crashing process.

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Application 2.3
The recommended completion date is day 17.
Resulti
ng
Critical
Paths

Reducti
on
(days)

Projec
t
Durati
on
(days)

Cost
s
Last
Trial

Cras
h
Cost
Adde
d

Total
Indire
ct
Costs

Total
Pena
lty
Cost
s

Total
Projec
t
Costs

Tri
al

Crash
Activi
ty

B-D-EG-H

21

$7,5
00

$5,25
0

$700

$13,4
50

B-D-EG-H

19

$7,5
00

$300

$4,75
0

$500

$13,0
50

B-D-EG-H

17

$7,8
00

$400

$4,25
0

$300

$12,7
50

Further reductions will cost more than the savings


in indirect costs and penalties.
The critical path is B D E G H and the
duration is 17 days.
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02 - 47

Assessing Risks
Risk-management Plans
Strategic Fit
Service/Product Attributes
Project Team Capability
Operations
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Assessing Risks
Statistical Analysis
Optimistic time (a)
Most likely time (m)
Pessimistic time (b)
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Statistical Analysis
Area under curve
between a and b
is 99.74%

Mean

Time
Beta distribution
a

m
Mean
Time

Normal distribution

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Statistical Analysis
The mean of the beta distribution
can be estimated by
a + 4m + b
te =
6

The variance of the beta


distribution for each activity is
=
2

ba
6

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02 - 51

Example 2.4
Suppose that the project team has
arrived at the following time
estimates for activity B (site selection
and survey) of the St. Johns Hospital
project:
a = Calculate
7 weeks, the
m =expected
8 weeks, time
and band
= 15
a.
variance for activity
weeksB.
b. Calculate the expected time and
variance for the other activities in
the project.
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02 - 52

Example 2.4
a.

The expected time for activity B is


te =

7 + 4(8) + 15
54
=
= 9 weeks
6
6

The variance for activity B is


2 =

15 7
6

8
6

= 1.78

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02 - 53

Example 2.4
b.The following table shows the expected
activity times and variances for this
project. Time Estimates (week)
Activity Statistics
Activity

Optimistic
(a)

Most Likely
(m)

Pessimistic
(b)

Expected Time
(te)

Variance
(2)

11

12

13

12

0.11

15

1.78

10

15

10

2.78

16

10

1.78

14

25

30

24

7.11

18

10

4.00

25

36

41

35

7.11

35

40

45

40

2.78

10

13

28

15

9.00

15

5.44

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02 - 54

0.11

Application 2.4
The director of
continuing
education at
Bluebird
University just
approved the
planning for a
sales training
seminar. Her
administrative
assistant
identified the
various activities
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that must be

Application 2.4
The Network
Diagram is:
Start

J
I

Finish

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Application 2.4

the Bluebird University sales training seminar activitie


ulate the means and variances for each activity.
Most
Likely
(m)

Activity

Immediate
Predecessor(s)

Optimistic
(a)

Pessimistic
(b)

12

11

17

25

10

12

C, E

F
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7 Inc. publishing
9
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2013 Pearson
Education,
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Expected
Time (t)

02 - 57

Variance
()

Application 2.4

the Bluebird University sales training seminar activitie


ulate the means and variances for each activity.
Most
Likely
(m)

Activity

Immediate
Predecessor(s)

Optimistic
(a)

Pessimistic
(b)

12

11

17

25

10

12

Expected
Time (t)

Variance
()

6.83

0.25

8.33

1.00

4.00

0.11

17.33
10.00

5.44
0.44

4.00

0.11

C, E

7.50

0.69

7.00

0.44

F
5
7 Inc. publishing
9
Copyright
2013 Pearson
Education,
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11.50

2.25

02 - 58

4.00

0.00

Analyzing Probabilities
Because the central limit theorem can be
applied, the mean of the distribution is the
earliest expected finish time for the project
TE =

Expected activity times = Mean of normal


on the critical path
distribution

Because the activity times are


independent
p2 = (Variances of activities on the critical path)

Using the z-transformation


z=

T TE
p

where
T = due date for the project

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02 - 59

Example 2.5
Calculate the probability that St.
Johns Hospital will become
operational in 72 weeks, using (a) the
critical path and (b) path ACGJK.
a. The critical path BDHJK has a
length of 69 weeks. From the table
in Example 2.4, we obtain the
variance of path BDHJK: 2 =
1.78 + 1.78 + 2.78 + 5.44 + 0.11 =
11.89 Next, we calculate the z72 69
3
value:
z

0.87
11.89 3.45
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02 - 60

Example 2.5
Using the Normal Distribution appendix,
we find a value of 0.8078. Thus the
probability is about 0.81 the length of
path BDHJK will be no greater than
Normal distribution:
Length of
72 weeks.
Mean = 69 weeks;
critical

Because this is
the critical path,
there is a 19
percent
probability that
the project will
take longer than
72 weeks.

= 3.45 weeks

path

Probability of
exceeding 72
weeks is
0.1922

Probability
of meeting
the schedule
is 0.8078

69 72
Project duration (weeks)

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Prentice Hall

Example 2.5
b.

The sum of the expected activity


times on path ACGJK is 67
weeks and that 2 = 0.11 + 2.78 +
7.11 + 5.44 + 0.11 = 15.55. The z72 67
5
value is
z

1.27
15.55 3.94
The probability is about 0.90
that the length of path ACGJK
will be no greater than 72
weeks.
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02 - 62

Application 2.5
The director of the continuing education at
Bluebird University wants to conduct the
seminar in 47 working days from now. Using
the activity data from Application 2.4, what is
the
probability
that everything will be ready in
T=
47 days
time?
TE is: 43.16 days

And the sum of the


(0.25 + 5.44 + 0.69 + 2.25) = 8.63
variances for the critical
activities is:
ADGI,
The critical path
is
43.16
days.
and the expected completion
time
is
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02 - 63

Application 2.5
The Network
Diagram is:
Start

J
I

Finish

The critical path is A-D-G-I


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Prentice Hall

Application 2.5
T = 47 days
TE = 43.16 days
And the sum of the variances for the critical
activities Tis:
T8.63
E
47 43.16
3.84
z=

8.63

2.94

= 1.31

Assuming the normal distribution applies,


we use the table for the normal
probability distribution. Given z = 1.30,
the probability that activities ADGI can
be completed in 47 days or less is 0.9049.
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02 - 65

Monitoring and Controlling


Projects
Monitoring Project Status
Open Issues and Risks
Schedule Status

Monitoring Project Resources

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02 - 66

Solved Problem 2.1


Your company has just received an order
from a good customer for a specially
designed electric motor. The contract
states that, starting on the thirteenth
day from now, your firm will experience
a penalty of $100 per day until the job is
completed. Indirect project costs amount
to $200 per day. The data on direct costs
and activity precedent relationships are
given in Table 2.2.
a. Draw Copyright
the project
network
diagram.
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Prentice Hall

Solved Problem 2.1


Acti
vity

ELECTRIC MOTOR PROJECT DATA


Normal
Normal Crash
Crash
Immediate
Time
Cost ($) Time
Cost
Predecessor(s)
(days)
(days) ($)

11 Prentice Hall
2,500

1,000
1,400
2,000
1,200
900

3
4
4
5
2

1,300
2,000
2,700
1,400
1,100

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3,750

None
None
None
A
B
C

02 - 68

Solved Problem 2.1


a. The network diagram is shown in Figure 2.10.
Keep the following points in mind while
constructing a network diagram.
A
4

D
6

Finish

G
4

Start

B
7

E
3

C
5

F
11

H
3

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02 - 69

Solved Problem 2.1


b. With these activity times, the project will be
completed in 19 days and incur a $700
penalty. Using the data in Table 2.2, you can
determine the maximum crash-time reduction
and crash cost per day for each activity. For
Maximum
crash
time = Normal time Crash time =
activity
A
4 days 3 days = 1 day
Crash cost Normal costCC NC
Crash
=
=
cost per Normal time Crash timeNT CT
day
$1,300 $1,000
=
= $300
4 days 3 days
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Solved Problem 2.1

A
B
C

Crash Cost per Day


($)
300
200
700

Maximum Time Reduction


(days)
1
3
1

D
E
F
G

200
200
250
650

1
1
5
1

100

Activity

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02 - 71

Solved Problem 2.1


PROJECT COST ANALYSIS
Stage

Crash
Activity

Time
Reduction
(days)

Resulting
Critical
Path(s)

Project
Duration
(days)

Project
Direct
Costs,
Last
Trial ($)

Crash
Cost
Added
($)

Total
Indirect
Costs
($)

Total
Penalty
Costs
($)

Total
Project
Costs
($)

C-F-H

19

10,100

3,800

700

14,600

C-F-H

17

10,100

200

3,400

500

14,200

A-D-G-H

15

10,300

500

3,000

300

14,100

B-E-G-H
C-F-H
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02 - 72

Solved Problem 2.1


The critical path is CFH at 19 days, which is the
longest path in the network.
The cheapest activity to crash is H which, when
combined with reduced penalty costs, saves $300
per day.
Crashing this activity for two days gives
ADGH: 15 days, BEGH: 15 days, and CFH:
17 days
Crash activity F next. This makes all activities
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73
critical andCopyright
no more
crashing should be
as
Prentice
Hall

Solved Problem 2.2


An advertising project manager developed the
network diagram in Figure 2.11 for a new
advertising campaign. In addition, the manager
gathered the time information for each activity,
as shown in the accompanying table.
a. Calculate the
D
Finish
expected time and
A
E
variance for each
activity.
C
Start
G
b. Calculate the activity
B
slacks and determine
F
the critical path,
using the expected
activity times.
c. What is the
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probability
of
Prentice Hall

Solved Problem 2.2


Time Estimate (weeks)
Activity

Optimistic

Most Likely

Pessimistic

Immediate Predecessor(s)

13

14

12

A, C

16

E, F

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02 - 75

Solved Problem 2.2


a. The expected time and variance for each
activity are calculated as follows
te =
Activity

a + 4m + b
6

Expected Time (weeks)

Variance

4.0

1.00

5.5

0.69

3.5

0.25

12.0

1.78

6.5

2.25

9.0

2.78

4.5

0.69

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02 - 76

Solved Problem 2.2


b. We need to calculate the earliest start, latest start,
earliest finish, and latest finish times for each
activity. Starting with activities A and B, we proceed
from the beginning of the network and move to the
end, calculating the earliest start and finish times.

Activity
A
B
C
D
E
F
G

Earliest Start (weeks) Earliest Finish (weeks)


0
0 + 4.0 = 4.0
0
0 + 5.5 = 5.5
5.5
5.5 + 3.5 = 9.0
4.0
4.0 + 12.0 =16.0
9.0
9.0 + 6.5 = 15.5
5.5
5.5 + 9.0 = 14.5
15.5
15.5 + 4.5 =20.0
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Prentice Hall

Solved Problem 2.2


Based on expected times, the earliest finish date for the
project is week 20, when activity G has been completed.
Using that as a target date, we can work backward through
the network, calculating the latest start and finish times

Activity

Latest Start (weeks)

Latest Finish (weeks)

15.5

20.0

6.5

15.5

9.0

15.5

8.0

20.0

5.5

9.0

0.0

5.5

4.0

8.0

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Solved Problem 2.2


4.0

D 16.0

Finish

8.0 12.0 20.0


0.0

4.0

9.0

4.0 4.0 8.0

15.5

9.0 6.5 15.5

Start

5.5

9.0

5.5 3.5 9.0


5.5

15.5 G 20.0

0.0 5.5 5.5

15.5 4.5 20.0

0.0

F
5.5

14.5

6.5 9.0 15.5


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Prentice Hall

Solved Problem 2.2


Start (weeks)
Activity

Earliest

Finish (weeks)

Latest

Earliest

Latest

Slack

Critical Path

4.0

4.0

8.0

4.0

No

0.0

5.5

5.5

0.0

Yes

5.5

5.5

9.0

9.0

0.0

Yes

4.0

8.0

16.0

20.0

4.0

No

9.0

9.0

15.5

15.5

0.0

Yes

5.5

6.5

14.5

15.5

1.0

No

G
Path

15.5
15.5
20.0
Total Expected Time (weeks)

20.0

0.0
Yes
Total Variance

AD

4 + 12 = 16

1.00 + 1.78 = 2.78

AEG

4 + 6.5 + 4.5 = 15

1.00 + 2.25 + 0.69 = 3.94

BCEG

5.5 + 3.5 + 6.5 + 4.5 = 20

BFG

5.5 + 9 + 4.5 = 19

3.88

0.69 + 0.25 + 2.25 + 0.69 =


0.69 + 2.78 + 0.69 = 4.16

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Solved Problem 2.2


The critical path is BCEG with a total expected
time of 20 weeks. However, path BFG is 19 weeks
and has a large variance.

c. We first calculate the z-value:

z=

T TE

23 20
=

3.88 = 1.52

Using the Normal Distribution Appendix, we


find the probability of completing the project
in 23 weeks or less is 0.9357. Because the
length of path BFG is close to that of the
critical path and has a large variance, it
might well
become
the
critical
path
during
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2013 Pearson
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the project

All rights reserved. No part of this publication may be


reproduced, stored in a retrieval system, or
transmitted, in any form or by any means, electronic,
mechanical, photocopying, recording, or otherwise,
without the prior written permission of the publisher.
Printed in the United States of America.
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