CRITICAL PATH ANALYSIS (NETWORK ANALYSIS)

IB Operations Management

The Aims of Network Analysis are to :

 facilitate the planning and coordination of large projects  identify critical activities that determine the total duration of the project  identify activities that cause, or or likely to cause, bottlenecks and delays  determine when resources and components are needed  plan the use of resources  reduce and eliminate idleness  identify important linkages and sequential, dependant relationships  reduce costs by reducing waste  facilitate the taking of corrective action when performance falls below that specified in the plan

Applications of Network Analysis

Network analysis can be used when planning and controlling large projects in fields such as construction, research and development and computerisation. By planning this way:  completion times can be calculated  completion times for intermediate activities can be monitored  resources can be prioritised  costs can be calculated In addition, the possibilities and costs of crashing an activity can be evaluated.

Crashing is when you shorten the time taken to complete certain jobs
on he critical path by assigning extra labour and /or equipment.

Node number

Earliest start time (EST) DRAWING A of subsequent NETWORK DIAGRAM activities

Activity Latest finish time (LFT) of preceding activities Node (circles) - to show start and end of activities, and also carry information about earliest start times (EST) and latest finish times (LFT) Arrows to show the flow of activities Hatching ( // ) drawn on the arrows of those activities on the critical path

Rules for Drawing Networks

 The network must start and end on a single node  No lines should cross each other  When drawing an activity, do not add the end node straight away; wait until you have looked to see which activity follows  There must be no lines that are not activities  Draw large circles for nodes, and short lines for activities (figures need to be inserted within the node)

A A B

3 4

1 3

Activity A has to be completed before B can be started

Neither B nor C can be started until A has been completed, B and C can be carried out concurrently

A C B

1 4 2

3
B D

2
A and B are both independent of each other but both must be completed before C can start

A and B are independent of each other but both must be completed before either C or D is started. C and D can be carried out concurrently

EXAMPLE OF A NETWORK FOR A FLAT PACK (IKEA)

Activity A B C D Preceded by A B,C Estimated duration (mins) 5 3 12 4

A fitted to B

Screwed to C

ABC slotted into DE

A 5 mins

B 3 mins

D 4 mins

//

D & E glued together C 12 mins //

Critical path = C, D

CALCULATION OF A NETWORK DIAGRAM

Activity Preceded by A B C D E B B A, C Duration 6 10 4 8 2

A 6 C 4 B 10
2

E 2

D 8

CALCULATION OF EST AND LFT

EST left to right take the highest number LFT right to left take the lowest number

0 0

A 6 C 4 B 10
10 2 10

14 3 16

E 2

18 4 18

D 8

INDICATING THE CRITICAL PATH

The critical path comprises the activities which take the longest to complete. They determine the length of the whole project. These are activities which must not be delayed by even one day. To identify the critical path, the two key points are:  it will be on activities where the nodes show the EST and LFT to be the same  it is the longest path through the nodes

0 0

A 6 C 4 B 10
10

14 3 16

E 2

18 4 18

//

D 8

10

//

The critical path will be B, D

FLOAT TIME
Float is the spare time available for any activity.

AQA specification states knowledge of TOTAL FLOAT Total float measures the spare time available so that there is no delay to the project as a whole.

CALCULATION
LFT Duration EST = Total Float (This activity) A B C D E 16 10 16 18 18 6 10 4 8 2 (this activity) 0 0 10 10 14 = = = = = 10 days 0 days 2 days 0 days 2 days

Advantages of CPA  Time between tasks is reduced to produce a smoothly run, coordinated project links to time based management  Improved decision making - construction of the network forces managers to plan forward and to consider all relevant tasks  By readjusting float the amount of resources can be minimised, thus improving efficiency  Improved working capital control as stock can be ordered on JIT basis  The network acts as a control technique to check the progress of the project, which is particularly important if there are penalty clauses for late completion, ie motorway construction