Construction

Project
Management
Unit 2: PROJECT PLANNING, MONITORING & CONTROL
PROJECT PLANNING, MONITORING & CONTROL
Planning involves following steps:
(i) Setting Objectives (goal): It is an important task of planning objectives, helps
fixing a target to achieve. Unclear and ambiguous objective creates confusion.

(ii) Determining the Alternatives: After setting a goal, it is essential to determine the
alternatives available for achieving the goal.

(iii) Evaluation the alternatives: Determining alternatives only does not provide us
clear idea to make decisions. Hence, we have to evaluate them. E.g. use of
equipment for earthwork may be costly than doing it by labours, but output of
equipment will be more and saves project time.

(iv) Selecting the Best alternatives: Based on the information obtained from
evaluation of the alternatives, the practical and suitable alternative has to be selected.

(v) Formulating the Real Plan i.e. an action plan: After selecting the best
alternative, action plan for the execution of the task has to be prepared. The plan
should be able to exhibit all the activities to be performed as well as the specific dates
when the particular activity will be started and completed.
Project Monitoring & Control
 Planning Tools

1) Traditional Tools
i) Bar chart or Gantt chart
ii) Linked bar chart
iii) Milestone chart
2) Modern Tools
i) CPM / PERT
ii) Earned value analysis
 Planning Tools

1) Traditional Tools
i) Bar chart or Gantt chart

S.N. Task Name Duration May June July Aug

1. A 7 days
2. B 5 days
3. C 4 days
4. D 10 days
… …… ………
 Planning Tools

1) Traditional Tools
ii) Linked bar chart

S.N. Task Name Duration May June July Aug

1. A 7 days
2. B 5 days
3. C 4 days
4. D 10 days
 Planning Tools

1) Traditional Tools
ii) iii) Milestone chart
Weeks
S.N. Descriptions
1 2 3 4 1 2 3 4
1. Mobilization
2. Topographical investigation
3. PQ document preparation PQ docs’ prep
4. Preliminary design design approved
5. Approval of design
6. Detailed design
2) Modern Tools
i) CPM / PERT

Fundamentals of CPM networks:

a. Network: It is a diagrammatical representation of a project’s different activities and their logical inter-
relationships. Arrows and they are used in a network diagram and they represent activities and
events respectively.

b. Activity: It is a task to be performed. It takes time for completion. Activities in a network diagram are
represented by arrows, which are usually drawn from left to right. E.g. excavation of foundation, placing of
concrete, plastering etc.

c. Event: A node in a network diagram represents event. Event is an important instance i n a project’s life from
where an activity starts or where an activity ends. In simple words, event represents starts or completion of
tasks or works. It consumes no time and these are numbered. While numbering the events, number of head
events must always be greater than the number at the tail event.

d. Tail event: It represents beginning of a project. Since the first event lies at the tail of an arrow, the initial
event is called tail event.

e. Head event: It represents end of a project. Since the last event lies at the head of an arrow, the last event
is called head event.

f. Dual role event: All the intermediate events, in general, will become dual role events because intermediate
nodes will be at the head of preceding activities and will be at the tail of succeeding activities.
g. Critical path: It is the path in a network diagram, which take maximum time (i.e. longest duration) among the alternative paths through
which a project will be completed.

h. Critical activities: The activities lying on critical path are called critical activities. If a critical activity is delayed, it will consequently cause delay
in completion of a project.

i. Earliest start time (EST): It is the earliest time at which an activity can be started.
Earliest event time is the time required for the completion of an activity.
 Earliest start time +(plus) duration is earliest finish time.
 Earliest finish time is a forward calculation and is obtained by adding the duration.
Here, EFT = EST + Duration (D)
EST = EFT - D

j. Latest start time (LST): It is the latest time at which an activity can be started
without delaying the completion of the succeeding activities.
 Latest start time is a backward calculation and is obtained by deducting the duration.
LFT = LST + D LST = LFT - D
Note: The earliest event time and latest event time of the activities lying on the critical path will be same.

k. Float: It is the term that indicates the spare time available for the activities for their
completion without delaying the completion of a project. It is the difference between the time available and the time required for executing a task.
l. Total float: It is the difference between the latest finish time (LFT) or latest start time (LST) and
earliest finish time (EFT) or earliest start time (EST) respectively. TF = EFT – EST or LFT –LST
m. Free float: It is an obliged float within which an activity can move without affecting
the succeeding activities. FF = ESTB - EFTA
n. Dummy: It shows dependence among the activities. It occurs when two parallel activities
have the same tail and head event, and in the case of two activities independent to each
other but assumes a common event. It is also called a redundant activity and is represented by
broken arrow.
Network Rules
Following are the general rules to be remembered while preparing network:
i) Tail (initial) event should be one in a network diagram and should contain only outgoing
arrows.
ii) Until and unless all the activities leading to an event are completed no event is occurred.
iii) Until and unless the preceding events are completed no activity is started.
iv) Network path shall not be turned back. Event should not be dependent on the
succeeding events.
v) Before reaching the objective, every activity should be completed.
vi) Head (final) event should be only one.
vii) Network should contain all constraints and interdependencies.
viii)In a network diagram, the time flows from left to right.
ix) Num. given to a preceding event should be smaller than the num. given to the
succeeding events.
 PERT (Programmed Evaluation and
Review Technique)
Three types of time estimates use in PERT are:
i. The Optimistic Time Estimate (Ote): It is the shortest possible estimated time for the
completion of an activity. It is the time estimate made considering the ideal situation (i.e.
everything goes well).
ii. The Pessimistic Time Estimate (Pte): It is the longest possible estimated time for the
completion of an activity. It is the time estimate made considering the abnormal situation (i.e.
everything goes wrong and unexpected).
iii. The Most Likely Time Estimate (Mlte): The time, an activity will require for its completion lie
between the two time estimates – optimistic and pessimistic. Therefore, the other time, which
is most likely to occur is identified in PERT and is called most likely time estimate.

Expected time (te)= Ote+4Mlte+Pte

6
2.(ii) Earned Value Analysis (EVA)
Cost Variance (CV): Cost Variance is the difference of Budgeted Cost of Work Performed (earned value)
minus Actual Cost of Work Performed. i.e. cost performance CV = BCWP – ACWP,

Schedule Variance (SV): Schedule Variance is the difference of Budgeted Cost of Work Performed (earned
value) minus Budgeted Cost of Work Schedule. i.e. schedule performance SV = BCWP – BCWS

Cost Performance: Cost Performance can be obtained by dividing Earned Value by Actual Cost of Work
Performed. i.e CP=EV or BCWP/ACWP

Schedule Performance: Schedule Performance can be obtained by diving Earned Value by Budgeted Cost of
Work Schedule. i.e SP=EV or BCWP/BCWS
• Cost Performance Index (CPI)=EV/ACWP
• Schedule Performance Index (SPI)=EV/BCWS
Note:
CV +ve Under Budget
-ve Over Budget
0 on Budget
SV +ve Ahead Schedule
-ve Behind Schedule
0 on Schedule
The Cost Schedule Index (SPI)
• You have completed more work than planned if the SPI is
greater than one; the project is ahead of schedule.
• If you have completed less work than planned work if the SPI
is less than one. The project is behind schedule.
• The completed work is equal to the planned work if the SPI is
equal to one; the project is on schedule.
The Cost Performance Index (CPI)
• You are earning more than what you have spent if the CPI is
greater than one. The project is under budget.
• You are earning more than what you have spent if the CPI is
less than one. The project is over budget.
• Earning and spending is equal if the CPI is equal to one. You
can say that the project is proceeding as per the planned
spending.
Re-visit a few key points:
• CPI is the past cost performance of the project, and TCPI is the
future cost performance of the project.
• You will calculate the TCPI based on the BAC if you are under
budget.
• You will calculate the TCPI based on the EAC if you are over budget.
• If the To Complete Performance Index is less than one, you are in a
comfortable position.
• You have to perform with a better cost performance than the past
cost performance if the To Complete Performance Index is greater
than one. You can continue with the same cost performance if the
To Complete Performance Index is equal to one.
• If the CPI = 1, then EAC = BAC. This means you can complete your
project with your approved budget analysis.
• The Estimate at Completion will be equal to the budget at
completion at the start of the project, i.e., EAC = BAC.
 Work Break Down Structure
• WBS is a hierarchical and incremental decomposition of the
project into phases, deliverables and work packages. It is a tree
structure, which shows a subdivision of effort required to
achieve an objective; for example a program, project, and
contract.
Resource Allocation and Levelling
Resources, in general are men, money, machines and materials. We need to plan for
the resources to complete the project as per schedule.
 It is usual in planning a project; a planner has to consider no only the activity
precedence relationships but also the availability of the resources. In such cases, a
planner tries to allocate the resources for which we call resource allocation.
While allocating resources, the planner tries to distribute the resources from non-
critical activities to critical activities so that important activities (having no floats)
can be continued.
 By resource levelling, we try to optimize the use of resources required to complete
a project. Resource levelling helps in obtaining uniformity is resource
requirement throughout the life of a project. The benefit of resource levelling is to
ease resource management so that cost involved in managing resources can be
minimised.

Scheduling
Scheduling is an important task of a construction manager. In order to perform tasks
successfully, different types of schedules are prepared, such as: Construction
schedule, Equipment schedule, Material schedule, Labour schedule, financial
schedule etc.
Construction Schedule:
Construction Schedule

Project No.:- Year:-

Name of Project:- Location:-

Rate

Total

Month

S.N. Activities Quantity Unit per time II

I
week A E A

reqd
Equipment schedule:
E
1. E/W excavation
Equipment Schedule
Project No.:- Year:-
Name
2. of Project:-
PCC work Location:-

No. ofE = estimated, A = actual

Here; Duration
Month
S.N. Equipment
equipment II III

required

I
1. Excavator

2. Crane
Material schedule:
Material Schedule

Project No.:- Year:-

Name of Project:- Location:-

Materials’ Total
Month
S.N.
Description II III IV
Quantity I
1. Cement
2. Bricks
3. Reinforcement

Labour schedule:

Labour Schedule

Project No.:- Year:-

Name of Project:- Location:-

Labours’ Required
Month
S.N.
Description II III IV
No. I
1. Masons
2. Carpenter
 Time-cost Trade off
Time-cost trade-off is essential both to the individual
worker planning his own work and the multinational
company developing new production facilities for the next
century.
 The first stage is to examine the possible projects,
estimation their costs, benefits & risks.
 The best options are then analyzed in more detail: their
cost, time schedules and resource implications are all
assessed.
 For the project management time-cost trade off
alternative project plans are considered and best plan is
implemented.
1.0. A project had estimated cost of NRs 400,000. Some month after execution of the
project it was evaluated and during evaluation Earn Value (EV or BSWP) and
Actual Cost Work Performed (ACWP) of the project was found to be NRS. 200,000
and NRs. 250,000 respectively. The Budgeted Cost of Work Schedule (BCWS) of to
that duration was NRs. 240,000 and estimated project duration was 8 months. Find
Cost Variance, Schedule Variance, Cost Performance Index, Schedule Performance
Index, total project cost and expected duration of the project. Spring 2015 PU
Soln :
Given:
Project Cost (BAC)=NRs. 400,000.00
Earn Value (EV or BCWP) = NRs. 200,000.00
Actual Cost Work Performance (ACWP or AC) = NRs. 250,000.00
Budgeted Cost Work Schedule (BCWS) = NRs. 240,000.00
Time = 8 Months
Find Out:
Cost Variance (CV) =?
Schedule Variance (SV) =?
Cost Performance Index (CPI)=?
Schedule Performance Index (SPI)=?
Total expected cost = ?
Total project cost=?
Now, we have
CV=BCWP-ACWP
=200000-250000=NRs. -50000.00 (-ve indicates Project Over Budget)

SV=BCWP-BCWS
=200000-240000=NRs. -40000.00 (-ve indicates Project Behind Schedule)

CPI=BCWP/ACWP
=200000/250000 =0.8 (CPI is less than one Project is Over Budget)

SPI=BCWP/BCWS
=200000/240000 =0.833 (SPI is less than one Project is Behind Budget)

Total Project Cost = BAC/CPI = 400000/0.8 = Nrs. 500,000.00

Additional Cost = Final Cost – BAC = 500,000.00-400,000.00= NRs. 100,000.00
Expected Duration = Initial Schedule / SPI = 8/0.833 = 9.64 Months
Additional Time = Final Time – Initial time = 9.64 – 8 = 1.64 Months
= 30+0.64*30 = 49 Days
2.0. When 125m3of concrete is to be done in 10 days at cost of Rs. 1,250,000.00 at
the end of third day managed to complete 40m3 of concrete with expanses Rs.
375,000.00. Find EVA & comment the performance. Fall 2015 PU

Soln
Given:
Total Project Duration (TPD)=10 Days
Inspection Day (ID) = 3 Days
Total Project Volume (TPV) = 125 Cum
Completed Work Volume (CWV) =40Cum
Project Cost (BAC)=Rs,1,250,000.00
Actual Cost Work Performed (AC or ACWP) =Rs. 375,000.00
Find Out:
Planned Value (PV)=?
Cost Variance (CV)=?
Schedule Variance (SV)=?
Cost Performance Index(CPI)=?
Schedule Performance Index(SPI)=?
Now, we have
BCWS = (125*3*1250000)/(125*10)=Rs. 375,000.00
BCWP=40*1,250,000.00/125 = Rs. 400,000.00
CV=BCWP-ACWP=400,000-375000=Rs.25000.00 +ve Under Budget

SV=BCWP-BCWS= 400000-375000=Rs. 25000.00 +ve Ahead Schedule

CPI=BCWP/ACWP=400000/375000 = 1.067 CPI>1 Under Cost

SPI=BCWP/BCWS=400000/375000=1.067 SPI>1 Ahead Schedule

Final Time = Initial / SPI = 10/1.067 = 9.37 Days

Final Cost=Initial/CPI=1250000/1.067= Rs. 1,171,508.903

Less Cost = Initial – Final = 1250000.00-1171508.903 = Rs.78491.00 Save Amount

Class Assignment
Q1.Suppose as activity had 5 days duration and was expected to cost Rs. 10,000.00.
Set into project and prior to finishing and activity the following data were obtained
about the progress done to that activity.
a. Have so far worked for 3.5 days an activity?
b. Rs. 8,000.00 already spent on that activity.
c. 60% of an activity has been completed.

Q2. 25m3 of concreting have to be done into hours at an expense of Rs.500,000.00. The
following information has been recorded during the period. Comment on the
performances of each hours and draw S curves to forecast.
Hours Work Actual Cost
Completed
2 20% 90,000.00

4 45% 200,000.00

6 60% 225,000.00

8 85% 445,000.00
Q1 Soln
Total Work Progress at inspection day=100*3.5/5=70%
But completed only 60% with cost Rs. 8,000.00
Assume linear relationship of cost with time as per planning or standard S curve
i.e. BCWS, project expenditure = 10,000.00/5 = Rs. 2000.00
At reporting date 3.5 days, BCWS at 3.5 days =3.5 * Rs. 2000.00=Rs. 7000.00
Actual cost work performed (ACWP) as per expenditure = running bill = Rs.8000.00
Budgeted cost of work performed (BCWP) = Real Work Performed at site * Budget as per
initially planned =10,000 * 60 /100 = Rs. 6000.00
CV = BCWP-ACWP=6000-8000=Rs. -2000.00 Project Over Budget
SV=BCWP-BCWS=6000-7000=Rs. -1000.00 Project Behind Schedule
CPI=BCWP/ACWP=6000/8000=0.75 <1 Project Over Budget
SPI=BCWP/BCWS=6000/7000=0.85 <1 Project Behind Schedule
Final Cost = Initial / CPI = 10000/0.75=13,333.33
Additional Cost = 13,333.33-10,000.00=Rs. 3,333.33
Final Time = Initial / SPI =5/0.85=5.83 Days
Additional Day =5.83-5=0.83=0.83*24=20 Hours
As per Labor law of Nepal 8 hours a day is working hours.
Total require time to complete the project = 2 Days 4 Hours
 Soln
Per hour expenses =500,000/8= Rs. 62,500.00
Hours BCWS BCWP ACWP CV SV CPI SPI
2 =2*62500=125,000 =0.2*500000=100000 90000 10000 -25000 1.11 0.8
4 =4*62500=250000 =0.45*500000=225000 200000 25000 -25000 1.12 0.9
6 =6*62500=375000 =0.6*500000=300000 225000 75000 -75000 1.33 0.8
8 =8*62500=500000 =0.85*500000=425000 445000 -20000 -75000 0.95 0.85

Cost required to complete remaining 15 % worked =500000*15/100 =Rs. 75000.00

Additional Cost =(Final-Initial)=(445000+75000-500000)=Rs.20,000.00 (Extra cost need)
Time required =8*0.15=1.2 Hours = 1 hours 20 minutes
S Curve of the Data as Shown.
 It can be solve in this way also.
Hours BCWS BCWP ACWP CV SV CPI SPI
2 =2*62500=125,000 =0.2*500000=100000 90000 10000 -25000 1.11 0.8
4 =4*62500=250000 =0.45*500000=225000 200000 25000 -25000 1.12 0.9
6 =6*62500=375000 =0.6*500000=300000 225000 75000 -75000 1.33 0.8
8 =8*62500=500000 =0.85*500000=425000 445000 -20000 -75000 0.95 0.85

Hours CV Remarks SV Remarks CPI Remarks SPI Remarks

2 10000 Under -25000 Behind 1.11 Under 0.8 Behind
Budget Schedule Budget Schedule
4 25000 Under -25000 Behind 1.12 Under 0.9 Behind
Budget Schedule Budget Schedule

6 75000 Under -75000 Behind 1.33 Under 0.8 Behind

Budget Schedule Budget Schedule

8 -20000 Over -75000 Behind 0.95 Over 0.85 Behind

Budget Schedule Budget Schedule
Q3.Determine the expected time, standard deviation and variance
along critical path of the following activities. Also mark the critical
path in the PERT network diagram. Assume days in months

Activity Most Most Likely Most

Optimistic Time Pessimistic
Time Time
1-2 2 5 14
1-3 3 12 21
2-4 5 14 17
3-4 2 5 8
3-5 6 15 30
4-5 1 4 7
Soln

Activity Most Most Likely Most Expected Time

Optimistic Time (MT) Pessimistic (ET=(OT+4MT
Time (OT) Time (PT) +PT)/6)
1-2 2 5 14 6
1-3 3 12 21 12
2-4 5 14 17 13
3-4 2 5 8 5
3-5 6 15 30 16
4-5 1 4 7 4
1-3-5=18+24=42 Months Maximum Day required to complete the project. Therefore 1-3-5 is critical
path
Activity Most Most Most Expected Time Standard Variance
Optimistic Likely Pessimistic (ET=(OT+4MT+PT)/ Deviatio σ2={(PT-
Time (OT) Time Time (PT) 6) n OT)/6}2
(MT) (σ=(PT-
OT)/6)
1-2 2 5 14 6
1-3 3 12 21 12 3 9
2-4 5 14 17 13
3-4 2 5 8 5
3-5 6 15 30 16 4 16
4-5 1 4 7 4

Sum of the variance of Critical Path= 16+9=25Months

Standard Deviation =√25=5 Months
Example 4:
A small project consisting of eight activities has the following
characteristics:

(i) Draw the PERT network for the project.

(ii) Prepare the activity schedule for the project.
(iii) Determine the critical path.
(iv) If a 30- week deadline is imposed, what is the probability that the
project will be finished within the time limit?
Solution:
The network diagram for the given data is shown in fig. below. The earliest time and
variance of each activity is computed by using the formula.

(ii) Calculation activity duration and scheduling

times.
(iii) The critical path of the project is 1-2-4-5 -6, critical activities being A, D, G and H.
The expected project length is the sum of duration of each critical activity. Expected
project length = 5 + 15 + 4 + 5 = 29 weeks.
Variance project length is obtained by summing variance of each critical activity.

(Iv) The required probability can be determined by finding the area under the
normal curve to the left of X = 30
Now, the probability of completing the project within the 30 week deadline is
(v) If the project start T weeks before the due date, the X will
represent the ordinate under normal curve to the left of which 99% of
area lies.
The area between n and X- being 99-50 or 49% and Z – value
corresponding to this is 2.33 (From table)
 Numerical for practice
For the given activities determine.
•Critical path using PERT.
•Calculate variance and standard deviation.
•Calculate probability of completing the project in 26 days
Activities To Tm Tp
1-2 6 9 12
1-3 3 4 11
2-4 2 5 14
3-4 4 6 8
3-5 1 1.5 5
2-6 5 6 7
4-6 7 8 15
5-6 1 2 3
Q5. Find CP,EST,EFT,LST,LFT,TF,FF,IF,of following activity.
Activity Duration
0-1 3
0-2 5
1-2 3
1-3 2
2-4 3
3-4 0
3-5 1
4-5 5
5-6 2
Q6. Find CP,EST,EFT,LST,LFT,TF,FF,IF of following activity.
Activity Duration Sucessor Predecessor
A 3 B -
B 4 D,C A
C 3 H B
D 10 E,F,G B
E 8 H D
F 4 H D
G 6 H D
H 8 I,J C,E,F,G
I 5 K H
J 5 L H
K 4 M I
L 2 M J
M 4 - L,K
Example 7:
Draw the activity-on-node (AON) project network associated with the following activities.

Activity Immediate Time (Days)

Predecessor(s)
A – 3
B A 4
C A 6
D B 6
E B 4
F C 4
G D 6
H E, F 8

What are the critical path activities?

Calculate EST EFT LST LFT TF FF IF also.
 Solve in Class
Activity Duration Remarks
1-2 5
1-3 4
2-4 3
3-4 8
3-5 9
4-5 7

Activity Predecessor Duration Days

A - 2
B - 3
C A 7
D A,B 2
E C,D 2
F B 4
Activity Most Optimistic Most Likely Time Most Pessimistic
Time Time

1-2 3 6 9

1-6 2 5 8

2-3 6 12 18

2-4 4 5 6

3-5 8 11 14

4-5 3 7 11

6-7 3 9 15

5-8 2 4 6

7-8 8 16 18
Q1

Q2
Q3
Problem 8
Calculate minimum cost & minimum duration schedule using
time cost trade off analysis of the project with the following
details. Indirect cost is Rs 100 per day. Duration in days
Activity Predecessor Normal Crash Normal Crash Cost
Duration Duration Cost (Rs) ( Rs)
(tn) (tc)
A - 5 2 5000 6200
B A 4 3 6000 7000
C A 3 2 5000 6500
D A 6 4 4000 4400
E B 5 3 15000 18000
F D 4 2 3000 4800
G C,E,F 6 3 8000 10400
Soln
Trial 1
Network Diagram & Cost Slope of each activity
Activity Predecessor Normal Crash Normal Crash Cost
Duratio Duration Cost (Rs) ( Rs)
n (tn) (tc)
A - 5 2 5000 6200
B A 4 3 6000 7000
C A 3 2 5000 6500
D A 6 4 4000 4400
E B 5 3 15000 18000
F D 4 2 3000 4800
G C,E,F 6 3 8000 10400
Total 33 19 46000 57300

Notation as
Activity Head
Tail
Event
Event
Duration
 3 E
B
5 G
A 4 C
1 2 5 6
D 3 F 6
5
6 4 4

Path
A-B-E-G =5+4+5+6=20 , A-C-G=5+3+6=14 , A-D-F-G=5+6+4+6=21
Here, path A-D-F-G = 21 days which has maximum duration called critical path.
Total Project Cost (TPC) = Direct Cost + indirect cost
TPC = ɛ Normal cost + Critical path duration x rate per day
TPC = 46000 + 21 x 1000 = Rs 67000.00
Activity Slope Cost (Sc) = ∆c / ∆t = Crash Time = tn - tc Path
( Cc – Cn ) / (tn – tc)
A (62000-5000) / (5-2) = 400 5-2=3 CA
B (7000-6000) / (4-3) = 1000 4-3=1 NCA
C (6500-5000) / (3-2) = 1500 3-2=1 NCA
D (4400-4000) /(6-4) = 200 6-4=2 CA
E (18000-15000) / (5-3) = 1500 5-3=2 NCA

F (4800-3000) / ( 4-2) = 900 4-2=2 CA

G (10400-8000) / (6-3) = 800 6-3=3 CA
Critical Crash Limit Slope Cost
Activity
A 3 400
D 2 200
F 2 900
G 3 800

Trial 2
Here critical path is single & duration as 21 days, cost slope of D is 200
which is minimum & crash limit 2 days. If D is fully crashed, than new
critical path duration will be 21-2=19 days. But path A-B-E-G having 20
days duration. In order to get two critical path in network analysis crash
activity D only with 1 days & new duration as 6-1=5
 3 E
B
5 G
A 4 C
1 2 5 6
D 3 F 6
5
5 4 4

Path
A-B-E-G =5+4+5+6=20 , A-C-G=5+3+6=14 , A-D-F-G=5+5+4+6=20
Here, path A-D-F-G & A-D-F-G are two critical path with having duration of 20
days.
TPC = Previous total project cost + Direct cost – indirect cost
TPC= 67000 + Cost slope of D – time reduction in critical path x rate per day
TPC = 67000 + 200 – (21-20) x 1000 = Rs. 66200.00
TPC crashing = Direct cost + cost due to crashing + new critical path x rate per day
TPC crashing = 46000+200+20 x 1000 = Rs. 66200.00
Trial 3
Critical Crash Limit Slope Cost
Activity
A 5-2=3 400
B 4-3=1 1000
E 5-3=2 1500
G 6-3=3 800
A 5-2=3 400
D 5-4=1 200
F 4-2=2 900
G 6-3=3 800

Here Critical path are two nos i.e. A-B-E-G & A-D-F-G. See common activity of both critical
path, which are A & G than select & crash least cost slope among A & G. ie activity A
having minimum cost slope of 400 per days. The crash limit of A is 3, if A is fully crash the
critical path reduction will be 20 – 3 = 17 which is greater than least or third path of
duration 14 days.
Also if A is fully crashed than (∆c /∆t ) of A – Crashing time x rate per day
= 3 x 400 – 3 x 1000 = Rs -1800.00 ( Means project
cost reduce)
If value comes positive than does not crash fully but to be crashed 1 day only.
 3 E
B
5 G
A 4 C
1 2 5 6
D 3 F 6
2
5 4 4

Path
A-B-E-G =2+4+5+6=17 , A-C-G=2+3+6=11 , A-D-F-G=2+5+4+6=17
Here, path A-D-F-G & A-D-F-G are two critical path with having
duration of 17 days.
TPC = Previous total project cost + Direct cost – indirect cost
TPC= 66200 + 3 times the Cost slope of A – time reduction in critical
path x rate per day
TPC = 66200 + 3 x 400 –(20-17) x 1000 = Rs. 64400.00
TPC crashing = Direct cost + cost due to crashing + new critical path
x rate per day
TPC crashing = 46200+3 x 400+17 x 1000 = Rs. 64400.00
Trial 4
Here Critical path are two nos i.e. A-B-E-G & A-D-F-G , Common activity of
critical path are A & G , A is fully crashed within compression limit & cannot
crashed further, The remaining common activity is G & crashed G activity with
cost slope of Rs 800 per day. The crash limit of activity G is 6 – 3 = 3 times, if G
is fully crashed, the critical path reduction will be 17 – 3 =14 days which is
greater than third path of duration 11 days.
Also if A is fully crashed than (∆c /∆t ) of G – Crashing time x rate per day
= 3 x 800 – 3 x 1000 = Rs -600.00 ( Means project cost reduce)
If value comes positive than does not crash fully but to be crashed 1 day only.
Crash activity G fully to its compression limit than new duration will be 6 – 3 =
3 days i.e. reduction of time duration as 3 (i.e crash limit).
 3 E
B
5 G
A 4 C
1 2 5 6
D 3 F 3
2
5 4 4

Path
A-B-E-G =2+4+5+3=14 , A-C-G=2+3+3=8 , A-D-F-G=2+5+4+3=14
Here, path A-D-F-G & A-D-F-G are two critical path with having
duration of 14 days.
TPC = Previous total project cost + Direct cost – indirect cost
TPC= 64400 + 3 times the Cost slope of G – time reduction in
critical path x rate per day
TPC = 64400 + 3 x 800 –(17-14) x 1000 = Rs. 63800.00
TPC crashing = Direct cost + cost due to crashing + new critical
path x rate per day
TPC crashing = 47400+3 x 800 + 14 x 1000 = Rs. 63800.00
Trial 5
Here Critical path are two nos i.e. A-B-E-G & A-D-F-G. of critical path duration 14 days,
the common activity of critical path A & G are fully crashed. Now. Go for the
simultaneous crashing, See & select one activity from each critical path for crashing
with minimum cost slope.
Critical Crash Limit Slope Cost
Activity
A 2-2=0
B 4-3=1 1000
E 5-3=2 1500
G 3-3=0
A 2-2=0
D 5-4=1 200 already crashed
F 4-2=2 900
G 3-3=0

Select activity B with minimum cost slope of 1000 per days from path
A-B-E-G and F from path A-D-F-G for the crashing (here activity D is
initially crashed) for the crashing by 1 day only for simultaneous
crashing (should not convert two nos of critical path into single critical
path due to crashing).
Activity B having duration 4-1=3 days & activity F having duration as 4-
1=3. The network diagram as.
 3 E
B
5 G
A 3 C
1 2 5 6
D 3 F 3
2
5 4 3

Path
A-B-E-G =2+3+5+3=13 , A-C-G=2+3+3=8 , A-D-F-G=2+5+3+3=13
Here, path A-D-F-G & A-D-F-G are two critical path with having
duration of 13 days.
TPC = Previous total project cost + Direct cost – indirect cost
TPC= 63800 + 3 times the Cost slope of B – time reduction in critical
path x rate per day
TPC = 63800 + 1000 –(14-13) x 1000 = Rs. 64700.00 > Rs 63800.00
TPC crashing = Direct cost + Cost slope of B + Cost slope of F + new
critical path x rate per day
TPC crashing = 49800+1000 + 900+ 13 x 1000 = Rs. 64700.00 > Rs
63800.00
Here total project cost after crashing is Rs. 64700.00 which is
greater than previous project cost Rs 63800.00, Stop for crashing.
The optimal solution is trial no 4. The network diagram as
 Optimum time ( To) = time of critical path
3 E
To = 2+4+5+3 =14 Days
B And Optimum cost (Co) = Rs 63800.00
5 G
A 4 C
1 2 5 6
D 3 F 3
2
5 4 4

Project Time 21 20 17 14 13
Total Project
Cost 67000 66200 64400 63800 64700
Problem 9
A project has activities with the following normal and crash
times and cost:

Determine a crashing scheme for the above project so that

the total project time is reduced by 3 weeks.
Solution
We have the following network diagram for the given project
with normal costs:
Therefore Path II is the critical path and the critical activities
are A, C, E, G and H. The non-critical activities are B, D and F.

Given that the normal time of activity A is 4 weeks while its

crash time is 3 weeks. Hence the time of this activity can be
reduced by one week if the management is prepared to spend
an additional amount. However, the time cannot be reduced by
more than one week even if the management may be prepared
to spend more money. The normal cost of this activity is Rs.
8,000 whereas the crash cost is Rs. 9,000. From this, we see
that crashing of activity A by one week will cost the
management an extra amount of Rs. 1,000. In a similar fashion,
we can work out the crash cost per unit time for the other
activities also. The results are provided in the following table.
A non-critical activity can be delayed without delaying
the execution of the whole project. But, if a critical
activity is delayed, it will delay the whole project.
Because of this reason, we have to select a critical
activity for crashing. Here we have to choose one of the
activities A, C, E, G and H The crash cost per unit time
works out as follows:
Rs. 1,000 for A; Rs. 1,000 for C; Rs. 1,000 for E; Rs. 6,000
for G; Rs. 3,000 for H.

The maximum among them is Rs. 1,000. So we have to

choose an activity with Rs.1,000 as the crash cost per
unit time. However, there is a tie among A, C and E. The
tie can be resolved arbitrarily. Let us select A for
crashing. We reduce the time of A by one week by
spending an extra amount of Rs. 1,000.
After this step, we have the following network with the revised times for the activities:

The revised time for Path I = 3 + 5 + 6 + 5 = 19 weeks.

The time for Path II = 3 + 4 + 6 + 7 + 4 = 24 weeks.

Maximum of {19, 24} = 24.

Therefore Path II is the critical path and the critical activities are A, C, E, G
and H. However, the time for A cannot be reduced further. Therefore, we
have to consider C, E, G and H for crashing. Among them, C and E have the
least crash cost per unit time. The tie between C and E can be resolved
arbitrarily. Suppose we reduce the time of C by one week with an extra
cost of Rs. 1,000.
 After this step, we have the following network with the revised times for the activities:

The time for Path I = 3 + 5 + 6 + 5 = 19 weeks.

The time for Path II = 3 + 3 + 6 + 7 + 4 = 23 weeks.

Maximum of {19, 23} = 23.

Therefore Path II is the critical path and the critical activities are A, C, E, G and H.
Now the time for A or C cannot be reduced further. Therefore, we have to consider
E, G and H for crashing. Among them, E has the least crash cost per unit time. Hence
we reduce the time of E by one week with an extra cost of Rs. 1,000.

By the given condition, we have to reduce the project time by 3 weeks. Since this
has been accomplished, we stop with this step.

Result: We have arrived at the following crashing scheme for the given project:
Reduce the time of A, C and E by one week each.

Project time after crashing is 22 weeks.

Extra amount required = 1,000 + 1,000 + 1,000 =
Rs. 3,000.
Thank You !