Project Scheduling Models

CPM / PERT
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Introduction

projects is a combination of various activities. PERT and CPM are two techniques that are widely used in planning and scheduling the large projects. These two technique are used to estimate and evaluate the project completion time and control the resources to see that the project is completed within the stipulated time and at minimum possible cost
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PERT Meaning-

It is a planning and control technique which uses the a network to complete a predetermine project on schedule

CPM Meaning-

it attempts to complete the given project as quickly as possible with minimum possible cost

Analysis-

Analysis-

it is probabilistic in nature. It can be analysed statistically.

It can't be analysed statistically.

Useful-

Useful-

It is useful for non repetitive and complex project.

It is best utilised for for repetitive and noncomplex project.

BasisUtility-

BasisUtility-

Its network is EVENT based. It is used where the emphasise is on shortning the projectexecution time without time without much concern for cost of the project.

Its network is ACTIVITY based. It is used where the emphasise is on optimising resource allocation and minimising overall cost for given execution time.

Time Estimates

Time Estimates

In this three time estimates i.e. Optimistic , most likely, and pessimistic, of completion for each activity. Here time estimates are uncertain.

In this one time estimates i.e. most likely time of completion for each activity. Here time estimates are certain.

Introduction
A project is a collection of tasks that must be completed in minimum time or at minimal cost. Objectives of Project Scheduling
Completing the project as early as possible by determining the earliest start and finish of each activity. Calculating the likelihood a project will be completed within a certain time period. Finding the minimum cost schedule 5

Introduction
A project is a collection of tasks that must be completed in minimum time or at minimal cost. Investigating the results of possible Objectives of Project Scheduling delays in activitys completion time.
Progress control. Smoothing out resource allocation over the duration of the project.

Task Designate
Tasks are called activities.
Estimated completion time (and sometimes costs) are associated with each activity. Activity completion time is related to the amount of resources committed to it. The degree of activity details depends on the application and the level of specificity of data. 7

Identifying the Activities of a Project

To determine optimal schedules we need to
Identify all the projects activities. Determine the precedence relations among activities.

Based on this information we can develop managerial tools for project control.
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Identifying Activities, Example

KLONE COMPUTERS, INC.
KLONE Computers manufactures personal computers. It is about to design, manufacture, and market the Klonepalm 2000 palmbook computer.
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KLONE COMPUTERS, INC

There are three major tasks to perform:
Manufacture the new computer. Train staff and vendor representatives. Advertise the new computer.

KLONE needs to develop a precedence relations chart. The chart gives a concise set of tasks and their immediate predecessors.

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 Network analysis is the general name given to certain specific techniques which can be used for the planning, management and control of projects
Use of nodes and arrows Arrows An arrow leads from tail to head directionally Indicate ACTIVITY, a time consuming effort that is required to perform a part of the work. Nodes A node is represented by a circle - Indicate EVENT, a point in time where one or more activities start and/or finish. Activity A task or a certain amount of work required in the project Requires time to complete Represented by an arrow Dummy Activity Indicates only precedence relationships Does not require any time of effort

Project Network

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Project Network
Event Signals the beginning or ending of an activity Designates a point in time Represented by a circle (node) Network Shows the sequential relationships among activities using nodes and arrows

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Project Network Activity An activity is an element of a project which must be carried out to complete the project. The activity denoted by an arrow. The tail end of an arrow represents

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Types of Activity
Predecessor Activity Successor Activity Concurrent Activity Dummy Activity

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Predecessor Activity- that must be

completed immediately prior to the start of another activity Successor Activity- the activity cannot be started until one or more activities are completed Concurrent Activity- that activity which can be accomplished simultaneously Dummy Activity- which only determines the dependencyof one activity over the other, but does't consume any time.
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Event
The beginning and end of activity are called events or nodes. Event is a point of time does't consume any resources. Event are represented by which are called nodes.

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Types of Events
Merge Event- when one or more activity join an event

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Burst Events- When more then one

activity starts from any events.

Merge and Burst Events- An event

on which more then one activity comes and at the same time more then one activity leaves

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Situations in network diagram

A A B A B A B Dummy C D C D both A and C must finish before either of B or D can start B A must finish before either B or C can start C C both A and B must finish before C can start

A must finish before B can start both A and C must finish before D can start
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Concurrent Activities
Lay foundation Lay foundation

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Dummy 2 1 0

3 2

Order material

Order material (b) Correct precedence relationship

(a) Incorrect precedence relationship

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KLONE COMPUTERS, INC From the activity description chart, we can determine immediate predecessors for each activity.
A

Activity A is an immediate predecessor Bof activity B, because it must be competed just prior to the commencement of B.
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Construct the Network

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

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Network
D G

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Precedence Relationships Chart

Act it iv y Im e t m dia e Pre ce de ssor Est a e im t d Com t ple ion Tim e

A B C D E F G H I J

None A B G D A C,F D A D,I

90 15 5 20 21 25 14 28 30 45

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The PERT/CPM Approach for Project Scheduling

The PERT/CPM approach to project scheduling uses network presentation of the project to
Reflect activity precedence relations Activity completion time

PERT/CPM is used for scheduling activities such that the projects completion time is minimized.
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KLONE COMPUTERS, INC. Continued

Management at KLONE would like to schedule the activities so that the project is completed in minimal time. Management wishes to know:
The earliest and latest start times for each activity which will not alter the earliest completion time of the project. The earliest finish times for each activity which will not alter this date. Activities with rigid schedule and activities that have slack in their schedules.
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CPM

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Earliest Start Time / Earliest Finish Time

Make a forward pass through the network as follows:
Evaluate all the activities which have no immediate predecessors.
The earliest start for such an activity is zero ES = 0. The earliest finish is the activity duration EF = Activity duration.

Evaluate the ES of all the nodes for which EF of all the immediate predecessor has been determined.
ES = Max EF of all its immediate predecessors. EF = ES + Activity duration.
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Earliest Start / Earliest Finish

Forward Pass
105,110 C C 5 90,105 B B 15 170 149,170 E E 21 110,124 115,129 129,149 G D G D 14 20

0,90 A A 90

90,115 F F 25

177 149,177 H 194 H 28 120,165 194 149,194 J J 45

EARLIEST FINISH 90,120 I I 30

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Latest start time / Latest finish time

Make a backward pass through the network as follows: Evaluate all the activities that immediately precede the finish node. The latest finish for such an activity is LF = minimal project completion time. The latest start for such an activity is LS = LF activity duration. Evaluate the LF of all the nodes for which LS of all the immediate successors has been determined. LF = Min LS of all its immediate successors. LS = LF - Activity duration. Repeat this process backward until all nodes have been evaluated.
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Latest Start / Latest Finish

Backward Pass
105,110 C 110,115 C 5 90,115 90, 115 F F 25 90,120 119,149 I I 30 90,105 B B 95,110 15 149,170 173,194 E E 21

5,95 A A 90

0,90 0,90

29,119

149,177 115,129 129,149 129,149 129,149 115,129 153,173 166,194 146,166 H D G D H G 20 28 14 129,149 149,194 149,194

194

J 45
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Slack Times
Activity start time and completion time may be delayed by planned reasons as well as by unforeseen reasons. Some of these delays may affect the overall completion date. To learn about the effects of these delays, we calculate the slack time, and form the critical path.
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Slack Times
Slack time is the amount of time an activity can be delayed without delaying the project completion date, assuming no other delays are taking place in the project.

Slack Time = LS - ES = LF - EF

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Slack time in the Project

Activity
A

LS-ES Slack Time

0 -0 95 - 90 110 - 105 119 - 119 173 - 149 90 - 90 115 115 166 - 149 119 - 90 149 - 149

B C D E F G H I
J

0 5 5 0 24 0 0 17 29 0

Critical activities Critical activities must be rigidly must be rigidly scheduled scheduled

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The Critical Path

The critical path is a set of activities that have no slack, connecting the START node with the FINISH node. The critical activities (activities with 0 slack) form at least one critical path in the network. A critical path is the longest path in the network. The sum of the completion times for the activities on the critical path is the minimal completion time of the project.
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The Critical Path

90,105 95,110 0,90 0,90 A A 90 B B 15 90,115 90, 115 F F 25 90,120 119,149 I I 30 105,110 C 110,115 C 5 149,170 E 173,194 E 21 149,177 166,194 H H 28 149,194 149,194

115,129 129,149 115,129 129,149 D G D G 20 14

J 45

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PERT (Project Evaluation Reivew Technique)

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The Probability Approach to Project Scheduling

Activity completion times are seldom known with 100% accuracy. PERT is a technique that treats activity completion times as random variables. Completion time estimates are obtained by the Three Time Estimate approach

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The Probability Approach

Three Time Estimates
The Three Time Estimate approach provides completion time estimate for each activity. We use the notation:
to = an optimistic time to perform the activity. tm = the most likely time to perform the activity. tp = a pessimistic time to perform the activity.

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The Probability Approach

Three Time Estimates
The Three Time Estimate approach provides completion time estimate for each activity. We use the notation: Optimistic time ( to )- it is shortest possible time by which an activity can be completed in ideal time. Pessimistic time (tp )- the maximum time an activity will take if everything goes wrong. Most likely Time (tm ) This time estimate which lies between the ' to' and 'tp ' and assume that things go is the normal way. 40

Expected time or Average time (TE TE = to+ 4tm+ tp

6 Standerd Deviation ( S.D)= tp - to / 6 Varience = square of S.D Normal Distribution= x-d

x- duration given d- duration of largest path SD
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The Project Completion Time Distribution - Assumptions

Assumption 1
A critical path can be determined by using the mean completion times for the activities. The project mean completion time is determined solely by the completion time of the activities on the critical path. The time to complete one activity is independent of the time to complete any other activity. There are enough activities on the critical path so that the distribution of the overall project completion time can be approximated 42 by the normal distribution.

Assumption 2

Assumption 3

The Probability Approach

KLONE COMPUTERS
Activity Optimistic Most Likely Pessimistic A 76 86 120 B 12 15 18 C 4 5 6 D 15 18 33 E 18 21 24 F 16 26 30 G 10 13 22 H 24 18 32 I 22 27 50 43

Cost Crashing

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The Critical Path Method (CPM)

The critical path method (CPM) is a deterministic approach to project planning. Completion time depends only on the amount of money allocated to activities. Reducing an activitys completion time is called crashing.
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Cost Analyses Using

Crash time/ Crash cost

There are two crucial completion times to consider for each activity.
Normal completion time (TN). Crash completion time (TC), the minimum possible completion time.

The cost spent on an activity varies between

Normal cost (CN). The activity is completed in TN. Crash cost (CC). The activity is completed 46 in T .

Crash time/ Crash cost

The Linearity Assumption

The maximum crashing of activity completion time is TC TN. This can be achieved when spending CN CC. Any percentage of the maximum extra cost (CN CC) spent to crash an activity, yields the same percentage reduction of the maximum time 47

A demonstratio Total Cost = $2600 Time Job time = 18 days n 20 and save on completion time 18 of the and save 16 more on Linearity Add 25% of the ext completion 14 cost... Add Add to to the Assumption more the time
Normal CN = $2000 TN = 20 days

12 normal cost... normal cost... 10 to save 25% of the max. time reduction 8 6 4 2

Crashing CC = $4400 TC = 12 days

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Cost ($100) 48 40 45