Unit 5: Network Models
5.1 Introduction
Network models are mathematical representations of systems where elements (nodes) are
interconnected through pathways (edges). These models are used to solve complex problems
related to routing, scheduling, resource allocation, and project management. They provide a
structured way to visualize and optimize relationships in systems.
Significance in Managerial Decision-Making:
1. Simplifies Complex Systems: Network models offer a visual and mathematical
representation, enabling decision-makers to break down intricate problems.
2. Optimizes Resource Usage: Ensures efficient allocation of time, labor, and materials.
3. Reduces Costs and Delays: Identifies bottlenecks and minimizes unnecessary delays.
4. Improves Coordination: Enhances interdepartmental collaboration and alignment of
goals.
Example in Ethiopia:
The Ethiopian Roads Authority uses network models to plan and manage the construction of
road networks, ensuring optimal routing and efficient use of resources to connect rural and urban
areas.
5.2 Objectives of Network Analysis
Network analysis enables project managers to plan, schedule, monitor, and control project
activities. It emphasizes the interdependencies among tasks, identifying critical activities, and
providing decision-makers with actionable insights.
Objectives:
1. Efficient Planning and Control:
o Provides a roadmap for the execution and monitoring of projects.
2. Time and Cost Optimization:
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o Minimizes project costs and ensures timely completion.
3. Critical Activity Identification:
o Identifies tasks that must not be delayed to avoid project overruns.
4. Improved Communication:
o Facilitates collaboration across teams by offering a clear visual of project
activities.
5. Flexible Resource Allocation:
o Helps optimize resource distribution based on activity requirements.
Example:
A construction company in Ethiopia uses network analysis to coordinate tasks such as land
clearing, foundation laying, and structural work, ensuring that delays in critical activities do not
affect the overall project timeline.
5.3 Applications of Network Techniques
Network techniques are applicable across industries for managing projects, optimizing systems,
and solving operational challenges.
1. Construction Projects:
o Scheduling tasks for building infrastructure like roads, dams, or residential
buildings.
o Example: The Grand Ethiopian Renaissance Dam (GERD) construction heavily
relies on network models to manage its timelines and resources.
2. Assembly Line Scheduling:
o Streamlining production processes in factories to minimize idle time and
maximize output.
o Example: Ethiopian factories manufacturing textiles or agricultural equipment use
network models for efficient production planning.
3. Transportation and Logistics:
o Optimizing delivery routes to reduce costs and meet deadlines.
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o Example: Distributing coffee exports from major production areas like Sidama
and Jimma to ports for export.
4. Healthcare:
o Scheduling operations and managing supply chains for medical equipment and
vaccines.
o Example: Network models are used in Ethiopia for distributing vaccines during
public health campaigns.
5. Disaster Relief:
o Planning resource distribution during emergencies.
o Example: NGOs in Ethiopia use network models to deliver food and water to
drought-affected regions efficiently.
5.4 Types of Network Models
1. Shortest Route Model
Objective: To find the shortest or most efficient route between two nodes in a network.
Applications:
Delivery route optimization.
Communication network design.
Steps:
Identify nodes (starting and destination points).
Calculate distances or costs for each route.
Select the route with the smallest total cost or distance.
Example in Ethiopia:
An NGO delivering medical supplies to rural clinics in the Somali region uses the shortest route
model to minimize travel time and costs.
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2. Minimum Spanning Tree
Objective: To connect all nodes in a network with the minimum total cost.
Applications:
Designing utility networks like water pipelines or electricity grids.
Establishing transportation infrastructure.
Steps:
Begin with any node.
Connect nodes incrementally by selecting the smallest cost edge that does not form a
cycle.
Continue until all nodes are connected.
Example in Ethiopia:
The Ethiopian Electric Utility (EEU) uses the minimum spanning tree model to expand its
electricity grid, prioritizing connections to rural villages.
3. Maximal Flow
Objective: To maximize the flow of goods, information, or resources through a network while
considering capacity limitations.
Applications:
Optimizing traffic flow.
Increasing supply chain efficiency.
Steps:
Define source and destination nodes.
Identify capacity constraints on each route.
Adjust flow to maximize throughput while adhering to constraints.
Example in Ethiopia:
Addis Ababa’s urban planners use the maximal flow model to manage traffic flow and reduce
congestion during peak hours.
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5.5 Project Scheduling: PERT and CPM
Project scheduling involves organizing tasks and activities to ensure project completion within
the desired timeframe and budget.
1. Critical Path Method (CPM):
o Key Features:
Assumes activity durations are fixed.
Identifies the critical path (the longest path through the network).
Calculates slack (allowable delay) for non-critical activities.
o Steps:
1. List all activities and their durations.
2. Identify dependencies between activities.
3. Compute the earliest and latest start/finish times.
4. Highlight the critical path.
o Example: An Ethiopian construction firm uses CPM to ensure that delays in
foundational work do not affect the project timeline.
2. Program Evaluation and Review Technique (PERT):
o Key Features:
Suitable for projects with uncertain activity durations.
Uses three time estimates for each activity:
Optimistic (a): Minimum duration if everything goes well.
Most Likely (m): Expected duration under normal conditions.
Pessimistic (b): Maximum duration considering delays.
Expected Time Formula:
a+ 4 m+b
Et =
6
o Example: Logistics companies in Ethiopia use PERT to account for potential
delays during the rainy season.
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5.6 Crashing and Time-Cost Tradeoffs
Crashing is a technique used to shorten project durations by allocating additional resources to
critical activities. While crashing reduces time, it increases costs.
Key Concepts:
1. Crash Time: The shortest possible time to complete an activity.
2. Crash Cost: The cost of achieving crash time.
3. Crash Cost Per Period Formula:
Crash Cost −Normal Cost
Crash Cost Per Period=
Normal Time−Crash Time
Steps:
Identify activities on the critical path.
Calculate crash costs per period.
Select activities with the lowest crash costs to reduce duration efficiently.
Example in Ethiopia:
A large-scale housing project in Addis Ababa accelerates construction by hiring additional
contractors to complete critical tasks like structural work and roofing.
Applications in Ethiopia
1. Infrastructure Development:
o Managing construction timelines for roads, bridges, and railways.
o Example: Coordinating construction of the Addis-Djibouti Railway.
2. Urban Planning:
o Optimizing public transportation routes and traffic flow.
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o Example: The Addis Ababa Light Rail project uses network models to streamline
operations.
3. Supply Chain Management:
o Distributing agricultural products from rural areas to urban markets.
o Example: Coffee cooperatives use network models to plan cost-effective logistics
for exports.
4. Disaster Response:
o Planning emergency relief operations during droughts or floods.
o Example: NGOs use network models to distribute food and water to affected
regions efficiently.
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