Post on 08-Nov-2014
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PROJECTPROJECTCRASHING,UPDATING,CRASHING,UPDATING, RESOURCE ALLOCATION RESOURCE ALLOCATION
Project CrashingProject CrashingThe process of accelerating a project is referred as crashing.Crashing a project relates to resource commitment; the more resources expended, the faster the project will finish.There are several reasons to crash a project:
Initial schedule was too optimistic Market needs change and the project is in demand earlier than anticipatedThe project has slipped considerably behind scheduleThere are contractual late penalties
Project CrashingProject CrashingPrincipal methods for crashing are:
Improving existing resources’ productivityChanging work methodsIncreasing the quantity of resources
Increasing the quantity of resources is the most commonly used method for project crashing. There are 2 approaches:
Working current resources for longer hours (overtime, weekend work, etc.)Adding more personnel
Project CrashingA
ctiv
ity c
ost
Activity time
Crashing activity
Crash time
Crash cost
Normal Activity
Normal time
Normal cost
Slope = crash cost per unit time
Fully expedited (no expense is spared
Time-Cost RelationshipTime-Cost Relationship Crashing costs increase as project duration decreases Indirect costs increase as project duration increases Reduce project length as long as crashing costs are less than indirect
costs
Time-Cost Tradeoff
cost
time
Direct cost
Indirect cost
Total project costMin total cost = optimal project time
Project CrashingProject CrashingIn analyzing crash options, the goal is to find the point at which time and cost trade-offs are optimized.
Various combinations of time-cost trade-offs for crash options can be determined by using the following formula:Slope = crash cost – normal cost
normal time – crash time
Project Crashing ExampleProject Crashing ExampleSUPPOSE:
NORMAL ACTIVITY DURATION = 8 WEEKSNORMAL COST = $14,000CRASHED ACTIVITY DURATION = 5 WEEKSCRASHED COST = $23,000
THE ACTIVITY COST SLOPE = 23,000 – 14,000 OR $9,000 = $3,000 per week 8 – 5 3
Cease crashing when
the target completion time is reachedthe crash cost exceeds the penalty cost
Project Crashing ExampleProject Crashing Example Normal Crashed
Activity Duration Cost Duration CostA 5 days $1000 3 days $1500B 7 days $700 6 days $1000C 3 days $2500 2 days $4000D 5 days $1500 5 days $1500E 9 days $3750 6 day $9000F 4 days $1600 3 days $2500G 6 days $2400 4 days $3000H 8 days $9000 5 days $15000Total costs = $22,450a) Calculate the per day costs for crashing each activity
b) Which are the most attractive candidates for crashing?
Project Crashing Example Project Crashing Example
Activity Per Day Cost(in $)A 250B 300C 1500D -E 1750F 900G 300H 2000
Project costs by durationProject costs by duration
Duration Total costs
27 days 22,450
26 days 22,700
25 days 22,950
24 days 24,700
23 days 26,450
22 days 28,200
21 days 30,200
20 days 32,200
19 days 34,200
UPDATING PROJECTUPDATING 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.
• 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.
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0
23
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413
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514
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616
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719
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824
249
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12
810
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Network at the start of the Project
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824
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810
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Network at the start of the Project
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Updated Network after day 15 of the Project
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(Finished 4-6) 2
(Finished 3-5) 8
Review at the end of 15th day
Activity Time reqd. (Days)
Activity Status
1-2 0 completed
1-3 0 completed
2-3 0 completed
2-4 0 completed
3-4 0 completed
3-5(13-15) 2 In Progress
4-6(14-16) 4 In Progress
5-7(15-17) 5 Not started
5-8(15-18) 9 Not started
6-8(16-18) 8 Not started
6-9(16-19) 12 Not started
7-9(17-19) 10 Not started
8-9(18-19) 8 Not started
New critical path1-2-3-4-14-16-18-19
Project duration increased by 1 day to 35 days
Review at the end of 15th day
Activity Time reqd. (Days)
Activity Status
1-2 0 completed
1-3 0 completed
2-3 0 completed
2-4 0 completed
3-4 0 completed
3-5(10-15) 2 In Progress
4-6(10-16) 4 In Progress
5-7(15-17) 5 Not started
5-8(15-18) 9 Not started
6-8(16-18) 8 Not started
6-9(16-19) 12 Not started
7-9(17-19) 10 Not started
8-9(18-19) 8 Not started
New critical path1-10-16-18-19
Project duration increased by 1 day to 35 days
2nd Method
10
0
23
3
37
7
413
13
514
15
616
16
719
26
824
249
34
34
2
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7
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5
9
3
12
810
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Network at the start of the Project
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010
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1517
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8
Updated Network after day 15 of the Project
Resource Allocation ProblemResource Allocation ProblemA shortcoming of most scheduling procedures is that they do not address the issues of resource utilization and availability.
Scheduling procedures tend to focus on time rather than physical resources.
Resource Allocation ProblemResource Allocation ProblemSchedules should be evaluated not merely in terms of meeting project milestones, but also in terms of the timing and use of scarce resources.
A fundamental measure of the project manager’s success in project management is the skill with which the trade-offs among performance, time, and cost are managed.
“I can shorten this project by 1 day at a cost of $400. Should I do it?”
Resource Allocation ProblemResource Allocation ProblemThe extreme points of the relationship between time use and resource use are the following:
Time Limited: The project must be finished by a certain time, using as few resources as possible. But it is time, not resource usage, that is criticalResource Limited: The project must be finished as soon as possible, but without exceeding some specific level of resource usage or some general resource constraint
Resource LoadingResource LoadingResource loading describes the amounts of individual resources an existing schedule requires during specific time periods.
The loads (requirements) of each resource type are listed as a function of time period.
Resource loading gives a general understanding of the demands a project or set of projects will make on a firm’s resources.
Resource LoadingResource LoadingThe project manager must be aware of the flows of usage for each input resource throughout the life of the project.
It is the project manager’s responsibility to ensure that the required resources, in the required amounts, are available when and where they are needed.
Resource LoadingResource Loading Table Table
Resource LResource Loading oading ChartChart Another way to create a visual diagram
of resource management problem is to use resource-loading charts.
Resource conflicts can be seen in the resource-loading charts.
They are used to display the amount of resources required as a function of time on a graph.
Each activity’s resource requirements are represented as a block (resource requirement over time).
Resource LResource Leveling eveling (Smooting)(Smooting)
Resource leveling aims to minimize the period-by-period variations in resource loading by shifting tasks within their slack allowances.The purpose is to create a smoother distribution of resource usage.Resource leveling, referred to as resource smoothing, has two objectives:
To determine the resource requirements so that they will be available at the right time,To allow each activity to be scheduled with the smoothest possible transition across usage levels.
Resource LResource Leveling eveling (Smooting)(Smooting)
Resource management is a multivariate, combinatorial problem, i.e. multiple solutions with many variables, the mathematically optimal solution may be difficult or infeasible.
More common approach to analyzing resource leveling problems is to apply some resource leveling heuristics.
Resource LResource Leveling Heuristicseveling HeuristicsPrioritizing resource allocation include applying resources to activities:
with the smallest amount of slackwith the smallest durationthat start earliestwith the most successor tasksrequiring the most resources
Resource LResource Leveling Stepseveling StepsCreate a project activity network diagramCreate a table showing the resources required for each activity, durations, and the total float availableDevelop a time-phased resource loading tableIdentify any resource conflicts and begin to smooth the loading table using one or more heuristics
Resource Leveling ExampleResource Leveling Example
Critical path:A-C-F-H-K
Resource Leveling ExampleResource Leveling Example
Critical path:A-C-F-H-K
Resource Leveling ExampleResource Leveling ExampleActivity Duration Total Float Resource Hours
Needed Per WeekTotal Resources
Required
A 5 0 6 30
B 4 1 2 8
C 5 0 4 20
D 6 3 3 18
E 6 1 3 18
F 6 0 2 12
G 4 3 4 16
H 7 0 3 21
I 5 3 4 20
J 3 5 2 6
K 5 0 5 25
Total 194
Resource Leveling ExampleResource Leveling Example
Resource Leveling ExampleResource Leveling ExampleOn day 10 the required resource hours is 10If project is budgetted for up to 10 resource units per day, then it is acceptable.C, D, and E are all scheduled on this day and have require 4, 3, and 3 hours respectively
Which activity should be adjusted?C is on the critical path E has 1 day slack D has 3 days of slack (we can split the activity)
Resource Leveling ExampleResource Leveling Example