Lecture 10

Schedule compression and time-cost trade of

Dr.Sawsan Hamzeh
 introduction

 Construction projects almost always have finish deadlines

assigned by the owner and stipulated in the contract .
Some projects have strict deadlines that do not allow for
any slippage ,because it mean a disaster.
 Other projects may have a deadlines that are rigid ,but a
slippage would not result in such disastrous outcomes .
Still other projects , not tied to a specific event or season
,may have “normal” finish dates ,which means the
contractor can work in a normal pace .

Dr.Sawsan Hamzeh
 introduction

 In most cases ,a normal schedule means 5 days per

week ,8 hours a day .slipping a few days in this case
may be acceptable and may not cause serious
consequences .

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 What is “accelerating” a project

 Accelerating a project means shortening the normal

duration of the project schedule (also called schedule
compression ) .it does not necessarily mean aiming
for the shortest possible duration . The term schedule
crashing is generally used to indicate maximum
acceleration .

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 Why accelerate a project?

 A contractor may want to accelerate a project for

many reasons :
 1- the contractors “normal” finish date in the planned
schedule does not meat the imposed finish date of
the contract .
 2- after starting construction and completing a certain
percentage of the project , the contractor realize that
the project is behind schedule .

Dr.Sawsan Hamzeh
 Why accelerate a project?

 3- in some case the contractor may have contractual

monetary incentive to finish ahead of schedule .
 4- sometimes ,especially when the economy is doing
well ,finishing early means -to the contractor starting -
another job earlier and ,thus , making more money .
 5– to a certain point ,accelerating a project may prove
profitable to the contractor , as will explained .

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 Direct and indirect costs

A contractor s main expenses are as follows :

1– direct costs
A- labor for whom a labor expense can be directly
linked to a particular work item .
B- materials , equipment , mainly construction
equipment .
C- subcontractors .

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 Direct and indirect costs

2- indirect costs :
project overhead (or job overhead ) such as the
following :1- project staff( project manager , project
superintendent , project engineer , etc )
2-office trailer and other temporary structures .
3-tempopapy utilities ( electricity , water ,telephones
,portable toilets , etc ) .
4-cars and trucks assigned to the project team .

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 Direct and indirect costs

5- other indirect project-related expenses such as power

generators ,projectors used to provide light during night
working hours .
As the schedule is compressed ,the direct and indirect
costs will be impacted in different and opposite manner.
Let us start with what we define as the normal duration
and the normal cost for the project .

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 Normal duration and normal cost

 Normal duration definition : the amount of time

required to finish the project under ordinary
circumstances with out any deliberate delay or
acceleration .
 Normal cost : is the cost of a project that is performed
with in normal duration .
These definitions also apply to individual activity .

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 Effect of acceleration on direct costs

 Direct costs almost always increase during project

acceleration . However , the more we accelerate, the
more the cost of accelerating per day increases .
There are two reasons for this phenomenon :
1- At the activity level ,accelerating more becomes more
difficult and may require different and more expensive
techniques .

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 Effect of acceleration on direct costs

2-at the entire project (or ,rather ,the critical path level )
we may have many activities from which to choose . We
always choose the activity that has the least cost for
crashing . As accelerating progresses ,we may have
fewer and more expensive choices .
For the preceding two reasons direct costs usually
increase nonlinearly ( at an increasing rate ) as shown in
the next curve .

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 Effect of acceleration on direct costs

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 Effect of acceleration on indirect
costs

 Indirect expenses are directly and linearly

proportional to the duration , so when a the project
is being accelerated ,they decrease at a constant rate,
as shown in the next figure .

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 Effect of acceleration on indirect
costs

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 Effect of acceleration on total cost

Depending on the shape ,slope ,and real values ,we

can combine the curves for direct and indirect costs ,
we obtain a curve like the one shown next .
We begin with the normal duration and normal cost .
Then ,we start acceleration .at the beginning , the total
cost decreases till it hits a minimum point ,the least cost
, with a corresponding least- cost duration .
If cost is our priority , we must stop at this point .

Dr.Sawsan Hamzeh
 Effect of acceleration on total cost

Dr.Sawsan Hamzeh
 Effect of acceleration on total cost

As we accelerate further , the cost increases till we

either reach our desired duration or encounter the least
possible duration , or crash duration , which has an
associated crash cost .

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 Recovery schedules

In real life projects , schedules may slip . The situation

may cause the owner concern especially if the project
dead line is critical . The owner may demand that the
contractor adjust the work plan to enable him to finish
the schedule .
When the contractor adjusts the schedule , the result
is a recovery schedule . It can be defined as a schedule
prepared during construction , after the project has
fallen behind .

Dr.Sawsan Hamzeh