Professional Documents
Culture Documents
Network Analysis
By
Prof. Nadpurohit
• Project Planning & Scheduling
• CPM & PERT Techniques
• WBS
•Network drawing
• Network Analysis
• Updating of Network
• Project Cost v/s Project Completion time
• Time Cost Trade off
• Crashing of Project Completion time
• Resource Management
• Types of resources
• Resource Smoothening & Resource Leveling
• Project Control
•Earned Value Management System
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 2 of 64
References:
• PMBOK
• Project Management by K Nagarajan, New
age International Publications
• Projects by Dr. Prasanna Chandra
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 3 of 64
“A Project”
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 4 of 64
Project Characteristics
Temporary:
The need for the Project no longer exists and the Project is
terminated.
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 6 of 64
Project Characteristics (continued)
Uniqueness an important characteristic of Product, Service
or Result
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 7 of 64
Relation between Product and Project Life Cycle
Upgrade
Product
Life Business
Divestment
Operations
Cycle Plan
I
D
E
Product
A
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 8 of 64
Project v/s Operational work
Organization
Performs Work
to achieve objectives
Projects Operations
. Temporary and Unique . Ongoing & repetitive
. Purpose to achieve objective . Objective is to sustain
And then terminate business
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 9 of 64
Some examples of Projects
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 10 of 64
Projects and Strategic Planning
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 11 of 64
Projects and Strategic Planning
. Market demand
. Organizational need
. Customer request
. Technological advance
. Legal Requirement
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 12 of 64
• Industrial / Commercial projects are
complex in nature.
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 13 of 64
Program Evaluation and Review
Technique - PERT
• Developed by US Department of Navy for their
“Polaris missile” program in 1958.
• Is a form of network analysis technique
consisting of
– Translating the proposed job into a model by drawing
a network of activities involved.
– Evaluating the network and manipulating it to the
extent possible so as to ensure that there will be a
reasonable chance of achieving the objective (viz.
completing the job) with in the constraints of time and
other resources.
– Using the network to monitor and control the job.
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 14 of 64
PERT
• Is of special relevance to
– One-time tasks such as construction of dams,
factories, bridges etc.
– Manufacture of ships, missiles and such other
activities which though repetitive are of huge
proportion
– R&D projects
– Major repairs and overhaul of plant /
machinery
– Organization of large events / conferences.
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 15 of 64
Critical Path Method (CPM)
• CPM originated in Du Pont de Nemours
company almost at the same time in 1958.
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 16 of 64
Gantt Chart
• A planning and control tool used for
scheduling jobs and depicting the progress
made from time to time.
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 17 of 64
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 18 of 64
Gantt Chart
• Merits
– Remarkably compact for the amount of
information it provides for planning and
controlling jobs.
– Easy to draw and read
– Its pictorial representation of time serves as
an aid to minimize idleness and loss of time.
• Demerits
– Does not depict the interdependencies of jobs
– Does not aid getting information on the
probability of completion of a job.
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 19 of 64
Stages in application of
PERT/CPM
• Drawing the network
– The purpose of this is to identify all the events /
activities that are essential for completion of a Project
and to bring out their interrelationship to satisfy the
technological / logical sequencing requirements.
• Network Analysis
– By incorporating the time required for completing
each of the activities in the network, the project
duration as well as the criticality of the activity can be
found out. At this stage it is also possible to compute
the probability of completing the Project or part of the
project in a given specified time
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 20 of 64
Stages in application of
PERT/CPM
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 21 of 64
Stages in application of
PERT/CPM
• Project control
– This stage calls for periodic updating of the network
amongst other things to monitor the progress of the
Project, and making necessary changes in the
schedules to ensure completion of the Project as
close to the target time as possible.
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 22 of 64
Concepts / Definitions
• Project
Temporary endeavor undertaken to create a unique
Product, Service or Result.
• Work breakdown structure (WBS)
A work breakdown structure is a deliverable oriented
grouping of project elements that organizes and defines the total
scope of the project.
Work not in the WBS is outside the scope of the project.
As with the scope statement, the WBS is often used to
develop or confirm a common understanding of project scope.
Each descending level represents an increasingly detailed
description of the project elements.
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 23 of 64
Concepts / Definitions
• Activity
Is a task or item of work to be done, that consumes time, effort, money or
other resources.
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 24 of 64
Concepts / Definitions
• Event
– Events do not consume resources.
– Events are represented by circle
– An Event is realized only when all activities
terminating at it are completed.
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 25 of 64
Concepts / Definitions
• Network diagram
– Shows how the tasks will flow from beginning
to end
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 26 of 64
Steps involved in drawing a
Network
• Identify the End objective and define the events which
are precedent to the End objective
• List out the activities required to accomplish these
events
• Draw the events and activities and connect them
according to the defined logic.
• Now for every activity answer the following questions
– What should precede it
– What needs to follow it
– What can be done concurrently
• Modify redraw the diagram to suit answers for above.
• Check for errors
• Number the events as per convention.
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 27 of 64
Activity sequencing: tools and
techniques
• Network diagram
– Shows how the tasks will flow from beginning
to end
– Types
• Precedence diagramming method (PDM)
• Arrow diagramming method (ADM)
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 28 of 64
Activity sequencing: tools and
techniques
start finish
B D
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 29 of 64
Activity sequencing: tools and
techniques
• PDM could have four types of
dependencies
– Finish-to-start
– Finish-to-finish
– Start-to-start
– Start-to-finish
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 30 of 64
Activity sequencing: tools and
techniques
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 31 of 64
Concepts / Definitions
• Activity
Is a task or item of work to be done, that consumes time, effort,
money or other resources.
It is represented by an arrow with its head indicating direction of the
progress in the project. i.e. The tail of the arrow marks the
commencement of the activity and the Head of the arrow marks the
completion of the activity.
The number 5 over the arrow indicates the Time required for completion of the
activity
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 32 of 64
Concepts / Definitions
• Event
– An activity is bound by 2 events referred to as Tail
event and Head event.
– Events do not consume resources.
– Events are represented by circle
– An Event is realized only when all activities
terminating at it are completed.
A
1 2
5
1 2
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 36 of 64
Network
Errors in drawing Network -
Dangling
1 2 3
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 37 of 64
ACTIVITY Predecess
or
A -
B -
C B C E
D A
B B
D B
E A
F A
F G I
G F A F F
H C.E,G
G
I F
H
E
F
4
2 G
A E I
H
1 5
6
C
B
D
3
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 38 of 64
• A Project consists of a series of activities labeled A, B, C, D, E, F, G,
H, and I. The interdependency of activities is as follows
A<D,E; B,D<F; C<G; B<H; F,G<I and G<H.
D B C G B H
F
A
E D
G
I
G H
F
2 E
A D
5
1 B D1 F 9
4 D2 H
7 I
C
G 8
3 6 D3 D4
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 39 of 64
Earliest Event Time Latest Event Time
E G(19) E
2 5
L L H(4)
C(20)
D1
D2
0
B(8) E F(18) E
1 E I(10)
0 4 6 7
L L
L
A(23)
D(16)
E(24)
E
3
L
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 40 of 64
E G(19) E
2 L
5 L H(4)
C(20)
D1
D2
0 B(8) E F(18) E I(10) E
1 0 4 L 6 7 L
L
A(23)
D(16)
E(24)
E
3 L
Determination of Earliest Event Time of Event
Start from the 1st Event i.e. Start of the Project. The Earliest Event time for it = 0
Consider the next event 2.
Consider all activities terminating at that event i.e. C. C starts at event 1 and
requires 20 days. For event 2 occur activity C has to be completed. Hence event 2
can occur only after the time event 1 has occurred and after C is completed
i.e after 0 + 20 days = 20 days
Similarly event 3 will occur after event 1 has occurred and activity A is completed
i.e. after 0 +23 days = 23 days
For event 4 to occur we need to complete activities B and D. The earliest that
event 4 can occur is after the completion of activity B and D. i.e. Maximum of (0 +
8), (23 + 16) = 39 days
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 41 of 64
20 39, 39
20 G(19) 39
2 5
L L H(4)
C(20)
D1
8,39 D2
43, 67, 47
0 39, 57
B(8) F(18)
39 67
57 I(10)
1
0 4 6 7
L L
L
A(23)
D(16)
E(24)
23
23
3
L
Hence earliest completion of Project time
is 67 days
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 42 of 64
20 G(19) 39
2 5
L L H(4)
C(20)
D1
D2
0 B(8) 39 F(18) 57 I(10) 67
1
0 4 6 7
L L L
A(23)
D(16)
E(24)
23
3
L
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 43 of 64
57, 63
20 G(19) 39
2 38 5
38 57 H(4)
C(20)
D1
D2
0 B(8) 39 F(18) 57 I(10) 67
1
0 4 39, 57
6 57 7
39 57 67
0, 31, 18 A(23)
D(16)
E(24)
23
3
23 23, 43
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 44 of 64
20 G(19) 39
2 5
38 57 H(4)
C(20)
D1
D2
0 B(8) 39 F(18) 57 I(10) 67
1
0 4 6 7
39 57 67
A(23)
D(16)
E(24)
23
3
23
Earliest Time Latest Time Total Float or
Activity I,j Normal Time Slack
Start Finish Start Finish available
E (3-7) 24 23 47 43 67 20
D1 (4-5) 0 39 39 57 57 18
F (4-6) 18 39 57 39 57 0
D2 (5-6) 0 39 39 57 57 18
H (5-7) 4 39 43 63 67 24
I (6-7) 10 57 67 57 67 0
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 45 of 64
Free Float, Interference Float, Independent Float
7
2
F (5)
A (7) 13
Consider activity K: If the tail event of this K activity is reached as late as possible and the Head event of the
activity starts as early as possible then the float for K is 17-8-3 = 6 days. This float of 6 days whose absorption
does not affect neither preceding activity nor the subsequent activity is called Independent Float
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 46 of 64
UPDATING PROJECT
• Can be done in 2 ways
– Use the revised time estimate of incomplete activities
and calculate from initial event the earliest completion
time and the latest completion time of each event in the
usual manner to know the Project completion time.
– Change the complete work to zero duration and
represent all the activities already finished by an arrow
called the Elapsed time arrow. Events in the revised
network are renumbered.
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 47 of 64
• The network for a project is shown below. A review of the project
after 15 days reveals that
– Activities 1-2, 1-3, 2-3, 2-4 and 3-4 are completed.
– Activities 3-5 and 4-6 are in progress and need 2 and 4 days more resp.
– The revised estimate shows that activity 8-9 will take only 8 days but
activity 7-9 will need 10 days.
• Draw the new network after updating the Project and determine
the Critical path.
3 13 3 16
7
2 4 6 12
3 13 16
3
8
24 10 34
0 6
4 8 9
1
24 34
0
9
2
7 7 14 19 8
3 5 5 7
7 15 26
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 48 of 64
etwork at the start of the Project Review at the end of 15th day
7 8 3-5(13-15) 2 In Progress
7 14 19
3 5 5 7 4-6(14-16) 4 In Progress
7 15 26
5-7(15-17) 5 Not started
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 49 of 64
etwork at the start of the Project Review at the end of 15th day
7 7 14 19 8 4-6(10-16) 4 In Progress
3 5 5 7
7 15 26 5-7(15-17) 5 Not started
7-9(17-19)
12
10
Not started
Not started
1
0 15
10
15 27 35
Project duration
increased by 1 day
0 15 9
10
2
to 35 days
17 22
15 5 17
18 25
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 50 of 64
Probability Assessment in PERT Network
• 3 time estimates are used for every activity
• Most optimistic time (to): it is the duration of the
activity when everything goes well. It is assumed
that such performance can be improved only in
about 1% of the cases
• Most likely time (tm): Normal time the activity would
take. It is the time that would occur most often if the
activity was to be repeated several times under the
same conditions.
• Most Pessimistic time (tp): It is the longest duration
expected under the assumption that every thing
goes wrong. There is only 1 % chance that the
activity will extend beyond this value.
• Expected Time (te) is given by (to + 4 tm + tp)/6
• Standard Deviation ( σ ) is given by (tp - to)/6
• Variance is given by ( σ )2
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 51 of 64
Probability Assessment in PERT Network
• The range specified by optimistic time
and pessimistic time is assumed to
enclose every possible estimate of the
duration of the activity.
• The most likely time estimate may not
coincide with the midpoint (to+ tp)/2.
• Hence it is justified to assume that the
duration of each activity follows Beta
(β) distribution with its unimodal point
occurring at tm and its end points at to &
tp
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 52 of 64
Probability Assessment in PERT Network
1 3 6 12
2 8 9 10
3 6 8 10
4 2 5 8
5 3 9 12
6 3 4 5
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 53 of 64
Activity Optimistic Time Most likely Time Pessimistic Time
1 3 6 12
2 8 9 10
3 6 8 10
4 2 5 8
5 3 9 12
6 3 4 5
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 54 of 64
Example
The following table gives the data for the activities of a small Project. Draw
the Network and determine the Expected completion of the Project. What is
the probability that the Project would take 5 more days for completion from
the Expected completion time. Find the Project completion time that will have
95% probability of success (2010, MU)
1-2 1 4 7
1-3 5 10 17
2-4 3 3 3
2-6 1 4 7
3-4 8 15 26
3-5 2 4 8
4-5 5 5 5
5-6 2 5 8
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 55 of 64
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 56 of 64
PERT CPM
The result of analysis are expressed in The results of calculations are
terms of events. PERT is hence said to considered in terms of activities of the
be Event oriented Project. CPM is activity oriented
The duration of activity is computed CPM uses only single time estimates
from multiple time estimates. This is and hence does not consider time
done to take into account time uncertainties
uncertainties. These estimates are used
to arrive at the probable achievement of
any given scheduled date of Project
completion.
Does not usually consider costs Attempts to bring out relationship
between Project duration and cost on
the premise that it would be possible to
manipulate project duration with in
certain limits by incurring certain costs.
Thus a shorter duration means
deployment of additional resources and
hence incidence of additional costs.
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 57 of 64
Time-Cost Trade-Off
• Project costs
– Direct costs
• Those expenses that can be directly charged to
each and every activity of the Project. E.g.
Manpower costs, material consumed,
equipment cost, etc.
– Indirect costs
• These are related to overall Project duration.
E.g. service and administration costs.
• Any reduction in the Project duration leads to
reduction of these costs.
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 58 of 64
Time-Cost Trade-Off
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 59 of 64
Time-Cost Trade-Off
• Cost Slope
– Cost Slope for an activity =
(Crash cost – Normal cost) /
(Normal time – Crash time)
Total Project Cost Time Relationship
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 60 of 64
Time-Cost Trade-Off
• Optimal Project Duration
– Is the one which results in minimum overall cost
of the Project.
– To determine this optimal duration we should
know
• Normal duration of each activity
• Normal cost of each activity
• Cost of crashing the activity and hence the Cost slope of
the activity
• Extend to which the activity can be crashed and
• Indirect cost of Project per unit time of Project duration
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 61 of 64
Example for determination of Optimal Project
duration and Minimum Project cost
• The following table shows details of a Project.The indirect cost is Rs.
400/- per day of Project duration.
• Determine the optimum Project Duration and minimum Project cost
Activi Imme Norm Cras Norm Cras Cost
ty diate al h al h Slop
10, 13, 14
Pred Time Time Cost Cost e
0
A(10)
eces (Wee (Wee (Rs.’ (Rs.’ (Rs.’
1
0 14 sor ks) ks) 000) 000) 000)
13 4
14 26, 21 A - 10 7 20 30 3.33
4, 0 13 D1(0)
G(12)
3 14 26
B(8) 14 B - 8 6 15 20 2.5
6
26
14 D(6)
C B 5 4 8 14 6
8 C(5) 16
F(5)
8 D B 6 4 11 15 2
16
2 E(8)
8 5
21 E B 8 5 9 15 2
9, 8, 13 21 F E 5 4 5 8 3
G A, D, 12 8 3 4 0.25
C
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 62 of 64
• The following table shows details of a Project.The indirect cost is Rs.
400/- per day of Project duration.
Activi Imme Norm Cras Norm Cras Cost
10, 13, 14 ty diate al h al h Slop
0
A(10) Pred Time Time Cost Cost e
1
0 14 eces (Wee (Wee (Rs.’ (Rs.’ (Rs.’
13 4 sor ks) ks) 000) 000) 000)
14 26, 21
4, 0 13 D1(0)
G(12) A - 10 7 20 30 3.33
3 14 26
B(8) 14
6
26 B - 8 6 15 20 2.5
14 D(6)
8 C(5) 16
F(5) C B 5 4 8 14 6
8
16
2 E(8) 5
D B 6 4 11 15 2
8
21
E B 8 5 9 15 2
9, 8, 13 21
F E 5 4 5 8 3
Normal Project Time = 26 days
Normal direct cost = Rs. 71,000/- G A, D, 12 8 3 4 0.25
Indirect cost = 400*26 = 10,400 C
Total Project cost
= Normal direct cost + Indirect cost
= 71,000 + 10,400 = Rs. 81,400/-
Critical path B-D-G (1-2, 2-4, 4-6)
Crashing critical activity with minimum cost slope i.e. activity G by 4 days, we get
0 A(10) 14
1 4 G(8)
0 14
D1(0)
13
22
3
14 6
22
B(8)
D(6)
C(5) F(5)
16
8
5
2 21
8
E(8)
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 63 of 64
• The following table shows details of a Project.The indirect cost is Rs.
400/- per day of Project duration.
Activi Imme Norm Cras Norm Cras Cost
A(10)
ty diate al h al h Slop
0 14
1 4 Pred Time Time Cost Cost e
G(8)
0 14 eces (Wee (Wee (Rs.’ (Rs.’ (Rs.’
D1(0) sor ks) ks) 000) 000) 000)
13
22
3 A - 10 7 20 30 3.33
14 6
22
B(8)
D(6) B - 8 6 15 20 2.5
C(5) F(5)
16
8 C B 5 4 8 14 6
5
2 21
8
E(8)
D B 6 4 11 15 2
0 A(10)
13
1
0 4 G(8)
D1(0) 13
13
3 21
B(8) 13
6
D(5) 21
C(5)
16
F(5)
8 5
16
2 E(8)
8
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 64 of 64
• The following table shows details of a Project.The indirect cost is Rs.
400/- per day of Project duration.
Activi Imme Norm Cras Norm Cras Cost
ty diate al h al h Slop
Pred Time Time Cost Cost e
0 A(10) eces (Wee (Wee (Rs.’ (Rs.’ (Rs.’
13
1 sor ks) ks) 000) 000) 000)
0 4 G(8)
D1(0) 13
13 A - 10 7 20 30 3.33
3 21
B(8) 13 B - 8 6 15 20 2.5
6
D(5) 21
C(5) C B 5 4 8 14 6
16
F(5)
8 5
16 D B 6 4 11 15 2
2 E(8)
8
E B 8 5 9 15 2
F E 5 4 5 8 3
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 65 of 64
Example for determination of Optimal Project
duration and Minimum Project cost
• The network given below gives the normal activity durations and the
table given below gives the data on the various costs and crash times.
The indirect cost is Rs. 120/- per day of Project duration.
• Determine the optimum Project Duration and minimum Project cost
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 66 of 64
Activity Norma Crash Norma Crash Cost
11
l Time Time l Cost Cost Slope
3
11 6
(days) (Days) (Rs.) (Rs.) (Rs.)
9
1-2 5 4 170 240 70
0
17
1
4 1-3 9 6 310 550 80
0 6 17
2-3 6 4 80 200 60
5
5 2-4 10 8 130 230 50
10
2
5 3-4 6 4 110 290 90
Critical Path
11
3
11 6
9
0
17
1
0 4
6 17
5
5
10
2 10
5
3
10 6
9
Normal Project Time = 17 days 0
16
Normal direct cost = Rs. 800/- 1
4
0
Total Project cost 5 16
2-3 6 4 80 200 60
5
5
10 2-4 10 8 130 230 50
2
5
3-4 6 4 110 290 90
9
3
Project Time = 16 days 9 6
9
Direct cost = Rs. 800/- + 60 = Rs. 860
0
Total Project cost 15
1
= Direct cost + Indirect cost / day x Duration of the Project 0 4
4
15
= 860 + 120 x 16 = Rs. 2780
Critical path 1-2, 2-3, 3-4 5
Activity 1-3 and 2-4, each have a float of 1 days 5
10
Crashing critical activity with minimum cost slope i.e. activity 2-3 we get 2
5
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 68 of 64
9 Activity Norma Crash Norma Crash Cost
3 l Time Time l Cost Cost Slope
9
9
6 (days) (Days) (Rs.) (Rs.) (Rs.)
2-3 6 4 80 200 60
5
5
10 2-4 10 8 130 230 50
Project Time = 15 days 2
5
Direct cost = Rs. 860/- + 60 = Rs. 920 3-4 6 4 110 290 90
Total Project cost
= Direct cost + Indirect cost / day x Duration of the Project
= 920 + 120 x 15 = Rs. 2720
Critical path: All paths are critical viz. 1-2-3-4; 1-2-4 & 1-3-4
Now Activity 1-3 and 2-4, do not have any float
Activity 2-3 has reached its crash duration and cannot be reduced further
Crashing options
a) Crash 1-2 & 1-3 at a crash cost of 70+80=Rs.150
b) Crash 2-4 & 3-4 at a crash cost of 50+90=Rs. 140
8 9
3 3
8 6 9 5
8 9
0 0
14 14
1 4 1 4
0 4 14 0 4 14
4 5
4 5
10 9
2 2
4 5
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 69 of 64
Crashing options Activity Norma Crash Norma Crash Cost
a) Crash 1-2 & 1-3 at a crash cost of 70+80=Rs.150 l Time Time l Cost Cost Slope
(days) (Days) (Rs.) (Rs.) (Rs.)
b) Crash 2-4 & 3-4 at a crash cost of 50+90=Rs. 140
1-2 5 4 170 240 70
2-3 6 4 80 200 60
a 8
b 9 2-4 10 8 130 230 50
3 3
8 6 9 5
8 9 3-4 6 4 110 290 90
0 0
14 14
1 1
0 4 0 4
4 14 4 14
4 5
4 5
10 9
2 2
4 5
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 70 of 64
Crashing options Activity Norma Crash Norma Crash Cost
a) Crash 1-2 & 1-3 at a crash cost of 70+80=Rs.150 l Time Time l Cost Cost Slope
(days) (Days) (Rs.) (Rs.) (Rs.)
b) Crash 2-4 & 3-4 at a crash cost of 50+90=Rs. 140
1-2 5 4 170 240 70
2-3 6 4 80 200 60
a 8
b 9 2-4 10 8 130 230 50
3 3
8 6 9 5
8 9 3-4 6 4 110 290 90
0 0
14 14
1 1
0 4 0 4
4 14 4 14
9
3
4 5 9 5
4 5 9
10 9
2 2 0
4 5 c 1
14
0 4
5 14
4
4
10
Option c) 2
4
Activity 2-3 which was at crash time has been relaxed by 1 day to 5 days. By
doing this it would be still at a time < its normal time.
Activity 1-2 has been crashed by 1 day to 4 days while activity 2-4 has been
relaxed to original 10 days
The crash cost from the original network would be 70+60+90=Rs.220
Therefore the Direct cost for this option of 14 days Project Time = 800+220=1020.
Indirect cost = 14x120=1680
Hence Total Project cost = 1680+1020=2700
Hence this c) option would be the best option
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 71 of 64
Activity Norma Crash Norma Crash Cost
9
d l Time Time l Cost Cost Slope
3
9 5
(days) (Days) (Rs.) (Rs.) (Rs.)
9
1-2 5 4 170 240 70
0
14
1
4 1-3 9 6 310 550 80
0 5 14
2-3 6 4 80 200 60
4
4 2-4 10 8 130 230 50
10
2
4 3-4 6 4 110 290 90
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 72 of 64
End of Chapter
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 73 of 64
Planning is essential for successful accomplishment
of any task
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 75 of 64
Network
Restraints and Ladders
A
1 2
Activity 1-3, Waiting to Activity 2-4, Time taken to
receive 1st lot for starting process last lot to complete
activity B B activity B
3 4
C
5 6
D
E
7 8
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 76 of 64
Activity sequencing: tools & techniques
• Network templates
– Standardized networks can be used for entire
project or portions (subnets or fragnets) of it
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 77 of 64
Activity sequencing: outputs
• Project network diagrams
– Schematic displays of projects activities and
logical relationships among them
– May include full project details or have one or
more summary activities (hammocks)
– E.g. PERT
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 78 of 64
• Project Planning & Scheduling (3 sessions)
• CPM & PERT Techniques
• WBS
•Network drawing
• Network Analysis
• Updating of Network
• Project Cost v/s Project Completion time (2 sessions)
• Time Cost Trade off
• Crashing of Project Completion time
• Resources allocation (1 session)
• Resource Smoothening and Resource Leveling
• Project Control (1 session)
• Earned Value Management
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 79 of 64
• Project: Characteristics & Types
• Project Identification & Formulation
• Project Management & Appraisal
• Project Cost Estimation & DPR
• Project Financing
• Project Appraisal
• Technical
• Financial &
• Market
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 80 of 64
Activity sequencing: tools and
techniques
B C
H
A G
start finish
D F
E
Sept 2010 Project Management Using Network Analysis, By Prof. Nadpurohit Slide 81 of 64