ABC Hospital (Project Management)

Project manager of the ABC hospital project, divided the project into two major modules.
Using WBS, the project team developed the precedence relationships, activity time estimates
etc as given in the following tables. The normal and possible crash time with associated costs
for each activity are provided in the table. These are called direct cost. Direct cost includes
labours, materials and any other costs directly related to project activities.

Project indirect cost is 8000 per week. Indirect cost includes administration and other
overhead cost that can be avoided by reducing project time.

There is penalty of 20,000 per week if the hospital is not fully operational by 65 weeks. The
penalty is imposed and agreed by both the parties.

Activity Activity Name Immediate

Code Predeces- Time Cost
sors
Organizing and Site Preparation
A Select administrative staff Start 12 12000
B Select site and survey Start 9 50000
C Select medical equipment A 10 4000
D Prepare final construction plans B 10 16000
E Bring utilities to site B 24 120000
Interview applicants for nursing and
F A 10 10000
support staff

Physical Facilities and Infrastructure

G Purchase and deliver equipment C 35 500000
H Construct hospital D 40 1200000
I Develop information system A 15 40000
J Install medical equipment E, G, H 4 10000
K Train nurses and support staff F, I, J 6 30000
Totals 1992000

a. Draw network diagram. Find EST, EFT, LST, LFT, Slack for each activity

b. Find Critical activities , critical path

c. Find the possible normal duration project duration and total cost (direct cost + indirect
cost + penalty cost, if any).