PROJECT MANAGEMENT

Dr. Najib Nicolas Gerges

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Project Management
Project Management is the discipline of organizing and managing resources (e.g. people) in a
way that the project is completed within defined scope, quality, time, and cost constraints. A
project is a temporary and one-time endeavor undertaken to create a unique product or
service, which brings about beneficial change or added value. This property of being a
temporary and one-time undertaking contrasts with processes, or operations, which are
permanent or semi-permanent ongoing functional work to create the same product or service
over and over again. The management of these two systems is often very different and requires
varying technical skills and philosophy, hence requiring the development of project managers
to lead projects. The primary challenge of project management is to achieve all of the project
goals and objectives while adhering to the project constraints. The secondary--and more
ambitious--challenge is the optimized allocation and integration of inputs needed to meet pre-
defined objectives. A project is a carefully defined set of activities that use resources (money,
people, materials, energy, space, provisions, communication, motivation, etc.) to meet the pre-
defined objectives.

Job Description
Project management is quite often the province and responsibility of an individual project
manager. This individual seldom participates directly in the activities that produce the end
result, but rather strives to maintain the progress and productive mutual interaction of various
parties in such a way that overall risk of failure is reduced. A project manager is often a client
representative and has to determine and implement the exact needs of the client, based on
knowledge of the firm they are representing. The ability to adapt to the various internal
procedures of the contracting party, and to form close links with the nominated
representatives, is essential in ensuring that the key issues of cost, time, quality, and above all,
client satisfaction, can be realized.

The Traditional Triple Constraints

Like any human undertaking, projects need to be performed and delivered under certain
constraints. Traditionally, these constraints have been listed as scope, time, and cost also
known as resources. These are also referred to as the Project Management Triangle, where
each side represents a constraint. One side of the triangle cannot be changed without
impacting the others. A further refinement of the constraints separates product 'quality' or
'performance' from scope, and turns quality into a fourth constraint.

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 The Project Management Triangle

The time constraint refers to the amount of time available to complete a project. The cost
constraint refers to the budgeted amount available for the project. The scope constraint refers
to what must be done to produce the project's end result. These three constraints are often
competing constraints: increased scope typically means increased time and increased cost, a
tight time constraint could mean increased costs and reduced scope, and a tight budget could
mean increased time and reduced scope. The discipline of project management is about
providing the tools and techniques that enable the project team (not just the project manager)
to organize their work to meet these constraints. Another approach to project management is
to consider the three constraints as finance, time, and human resources. If you need to finish a
job in a shorter time, you can throw more people at the problem, which in turn will raise the
cost of the project, unless by doing this task quicker we will reduce costs elsewhere in the
project by an equal amount.

CPM-Critical Path Method

In 1957, Dupont developed a project management method designed to address the challenge
of shutting down chemical plants for maintenance and then restarting the plants once the
maintenance had been completed. Given the complexity of the process, they developed the
Critical Path Method (CPM) for managing such projects.

CPM provides the following benefits:

• Provides a graphical view of the project

• Predicts the time required to complete the project
• Shows which activities are critical to maintaining the schedule and which are not.

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CPM models the activities and events of a project as a network. Activities are depicted as nodes
on the network and events that signify the beginning or the ending of activities are depicted as
arcs or lines between the nodes) concept of activity on nodes).

Project Planning
Project planning is a part of project management, which relates to the use of schedules such as
Gantt charts to plan and subsequently report progress within the project environment. Initially,
the project scope is defined as the appropriate methods for completing the project are
determined. Following this step, the durations for the various tasks necessary to complete the
work are listed and grouped into a work and breakdown structure. The logical dependencies
between tasks are defined using an activity network diagram that enables identification of the
critical path. Float or slack time in the schedule can be calculated using project management
software. Then the necessary resources can be estimated and costs for each activity can be
allocated to each resource, giving the total project cost. At this stage, the project plan may be
optimized to achieve the appropriate balance between resource usage and project duration to
comply with the project objectives. Once established and agreed, the plan becomes what is
known as the baseline. Progress will be measured against the baseline throughout the life of
the project. Analyzing progress compared to the baseline is known as earned value
management.

Steps in CPM Project Planning

1. Specify the individual activities.
2. Determine the sequence of those activities.
3. Draw a network diagram.
4. Estimate the completion time for each activity.
5. Identify the critical path (longest path through the network).
6. Allocate and level the resources when the availability is limited.
7. Update the CPM diagram as the project progresses.
8. Control the CPM diagram after updating.

1. Specify the Individual Activities

From the breakdown structure and for the bill of quantity (BOQ), a listing can be
made of all activities in the project. This listing can be used as the basis for adding
sequence and duration information in later steps.

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2. Determine the Sequence of the Activities
Some activities are dependent on the completion of others; a listing of the
immediate predecessors/successors of each activity is useful for constructing the
CPM network diagram.

3. Draw the Network Diagram

A project network is a graph or a flow chart depicting the sequence in which a
project’s terminal elements are to be completed by showing terminal elements and
their dependencies. Once activities and their sequencing have been defined, the
CPM diagram can be drawn. CPM originally was developed as an activity on node
(AON) network, but some project planners prefer to specify the activities on the arcs
known as activity on arrows.

4. Estimate Activity Completion Time

The time required to complete each activity can be estimated using past experience
or the estimates of knowledgeable persons. CPM is a deterministic model that does
not take into account variation in the completion time, so only one number is used
for an activity’s time estimate. The activity completion time as normally calculated
by dividing the original activity quantity Q as determined in the BOQ by the rate of
productivity based on a well-defined manpower. Normally, three rates of
productivity are estimated for each activity, one being the most optimistic A, the
second being the most pessimistic B, and the third being the most likely M; thus,
three durations are estimated for each activity, one being the most optimistic
duration (a = Q/A), the second being the most pessimistic duration (b = Q/B), and
the third being the most likely duration (m = Q/M). The duration of each activity (D)
is then calculated using the following equation:

Note that this duration is calculated based on a certain rate of productivity that is
directly depending on the number of manpower. If you wish to increase the rate of
productivity all that you have to do is increase the number of manpower, and the
activity duration will be reduced.

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5. Identify the Critical Path
The critical path is the longest duration path through the network. The significance
of the critical path is that the activities that lie on it cannot be delayed without
delaying the project. Because of its impact on the entire project, critical path
analysis is an important aspect of project planning.

The critical path can be identified by determining the following four parameters for
each activity:

• ES – earliest start time: the earliest time at which the activity can start given
that its precedent activities must be completed first.
• EF – earliest finish time, equal to the earliest start time for the activity plus
the time required to complete the activity.
• LF – latest finish time: the latest time at which the activity can be completed
without delaying the project.
• LS – Latest start time, equal to the latest finish time minus the time required
to complete the activity.

The slack time or float for an activity is the time between its earliest and latest start
time, or between its earliest and latest finish time. Slack or float is the amount of
time that an activity can be delayed past its earliest start or earliest finish without
delaying the project.

The critical path is the path through the project network in which none of the
activities have slack, that is, the path for which ES=LS and EF=LF for all activities in
the path. A delay in the critical path delays the project. Similarly, to accelerate the
project it is necessary to reduce the total time required for the activities in the
critical path.

The total float (TF) for an activity is defined to be the amount of time the ES of an
activity could be delayed without delaying the entire project.

The free float (FF) for an activity is defined to be the amount of time the ES of an
activity could be delayed without delaying the start of the immediate successors.

The interfering float (INTF) for an activity is defined to be the amount of time in
which the completion of an activity may occur and not delay the termination of the
project, but within which completion will delay the ES of some following activities.

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 The independent float (INDP) for an activity is defined to be the amount of time in
which the completion of an activity may occur and not delay the termination of the
project, not delay the early start of any following activities, and not be delayed by
any preceding activities.

The roles of the total and free floats in scheduling non-critical activities are
explained in terms of two general rules:

- If the total float equals to the free float, the non-critical activity can be scheduled
anywhere between its earliest start and latest completion time without delaying
the project.
- If the free float is less than the total float, the starting of the non-critical activity
can be delayed relative to its earliest start time by no more than the amount of
free float without delaying the start of the immediate succeeding activity nor
delay the project.

6. Allocate and Level the Resources when their

Availability is Limited
The sequencing and scheduling of activities to accommodate limitations in the
availability of resources is called resource allocating. Activities are analyzed to
determine their scheduled level of resource requirement and match with the
available resources. The project will either assign the required scheduled level to the
activity to implement the project or will alter, in an efficient manner, the
unacceptable work plan, into an implementable project.

In practice, however, a project will require the use of various resources such as
equipment (tools and machines), manpower (professional and trade labors), and
material. All of these resources can be presented in terms of project’s financial
requirements. Single resource scheduling will suffice for most projects. However, for
complex projects or those requiring scarce and extraordinary resources multi-
resource scheduling must be considered.

Resource scheduling problems vary in kind and are usually a function of the nature
of the project and its organizational setting. One category of resource scheduling
problem call “Resource Conflict Resolution” is when several concurrent activities
compete for a fixed quantity of resource. the procedure for resolving the conflicts is
modify the unacceptable schedule to re-sequence activities such that all resource

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 conflicts are resolved and the total project duration is increased a minimum amount.
Because of the nature of the procedure, it can be implemented only after the initial
network has been laid out, the time schedule is determined, and the resource
analysis is performed.

Another category of resource allocation problems is the time/cost tradeoff analysis

or crashing analysis. This type of problem occurs when there are no constraints on
the availability of resources; however, one may be interested in reducing the project
completion time by accelerating certain activities at the expense of allocating more
resources. It is important to note that time/cost tradeoff analysis and resource
allocation techniques are two different procedures. The reason for including this
type problem in this section is that as in the case of other resource allocation
problems, the analysis also includes an implicit relationship between cost of
resources and the project duration.

The next category of problems, referred to as “Fixed Resource Limit Scheduling,”

arises when there are definite limitations on the amount of resource available to
carry out the project. The scheduling objective in this case is to attempt to meet the
original project due date subject to the fixed limits on resource availability.
However, it is always possible that the project duration may increase beyond the
initially established schedule.

The last category of problems, to be considered here, referred to as “Resource

Leveling,” occurs when a sufficient amount of resources are available to complete
the project by a specified date; however, it is desirable or necessary to reduce the
magnitude of variation in the utilization of a resource over the life of the project.

7. Update CPM Diagram

As the project progresses, the actual task completion times will be known and the
network diagram can be updated to include this information. A new critical path
may image, and structural changes may be made in the network if project
requirements change. The usefulness of CPM is preserved throughout the course of
a project only because of its updating capabilities. Updating can be defined as
scheduling of the remaining portion of a job by introducing into the network the
latest information available, that is, the process of control. At the end of any period
of work, all operations in a network must be in one of the following status
categories:

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 1. Operations completed.
2. Operations in progress.
3. Operations not yet started.

It is important at this stage to define the percent completion for an activity which is
the ratio of the actual quantity performed to date to the total budgeted quantity as
reported in the bill of quantity (BOQ).

8. Control the CPM Diagram After Updating

During the updating process of the network, it is important to collect the following
information for each activity:

The budgeted cost of the work performed to date, the actual cost of the work
performed, the budgeted cost of the work scheduled to date, the scheduled time of
the work performed, and the actual time of the work performed. The above data is
needed to calculate the time variance, cost variance, and scheduled variance in
order to determine whether there is a delay (or not), a cost overrun (or not), and
whether the activity is behind (or not) its scheduled time.

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Practical Application
To illustrate the use and importance of project management in any project, consider the
following network that consists of ten activities, A through J.

Question:

1- Draw the network diagram given the following precedence relation.

A and B are the first activities

C succeeds A

D succeeds A

E succeeds B

F succeeds B and is one of the last activities

G succeeds C

H succeeds C

I succeeds G and is one of the last activities

J succeeds D, E, H and is one of the last activities

Answer: Activity on Node (AON)

It is always advisable to start the project with a Start Milestone (start of the project) and
end it with an End Milestone (end of the project).

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 Network Diagram (AON)

Answer: Activity on Arrow (AOA)

Network Diagram (AOA)

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 In (AOA), the following rule must be adopted: No distinct activities can have the same starting
node and ending node at the same time; in this case, introduce dummy activities as shown
below.

To illustrate the use of dummy activities in the AOA, let us consider the following network:

A and B are the first activities

C succeeds A and B

D succeeds B and is one of the last activities

E succeeds C and is one of the last activities

Start C E

End

Network Diagram (AON) D

B 1
D

0 D1
(Dummy) 4
A
E
C
2 3

Network Diagram (AOA)

To illustrate more on the use of dummy activities in the AOA, let us consider the following
network:

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 A and B are the first activities

C succeeds B and is one of the last activities

D succeeds A and B

E succeeds D and is one of the last activities

Start D E

End

B
C

Network Diagram (AON)

B 1
C

0 D1
(Dummy) 4
A
E
D
2 3

Network Diagram (AOA)

Question:

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 2- Given the quantity (obtained from the BOQ) and the most optimistic (A), most
pessimistic (B), and most likely (M) rate of productivity (according to a specified number
of manpower per day) for each activity, calculate the original duration of each activity.

Activity Quantity A B M
A 30 30 10 15
B 24 12 4 6
C 105 35 15 21
D 18 6 2 3
E 210 70 30 42
F 294 42 14 21
G 36 12 4 6
H 48 24 8 12
I 105 35 15 21
J 280 70 28 40
Answer:

First of all, let us calculate the most optimistic (a), the most pessimistic (b), and the most
likely (m) duration of each activity where the duration is equal to the quantity divided by
the rate of productivity. Then the duration of each activity is calculated accordingly to
the following equation:

, where a = Quantity/A, b = Quantity/B and m = Quantity/M

The original duration of each activity is:

Activity a b m Original Duration

A 1 3 2 2
B 2 6 4 4
C 3 7 5 5
D 3 9 6 6
E 3 7 5 5
F 7 21 14 14
G 3 9 6 6
H 2 6 4 4
I 3 7 5 5
J 4 10 7 7
Question:

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 3- According to the calculated duration of each activity, determine the duration of the
project and the critical path if all the relationships are Finish-to-Start (FS) with Lag = 0
and using AON.

Answer:

The critical path is the longest duration path through the network. The significance of the
critical path is that the activities that lie on it cannot be delayed without delaying the project.
Because of its impact on the entire project, critical path analysis is an important aspect of
project planning.

The critical path can be identified by determining the following four parameters for each
activity:

• ES – earliest start time: the earliest time at which the activity can start given
that its precedent activities must be completed first.
• EF – earliest finish time, equal to the earliest start time for the activity plus
the time required to complete the activity.
• LF – latest finish time: the latest time at which the activity can be completed
without delaying the project.
• LS – Latest start time, equal to the latest finish time minus the time required
to complete the activity.

The activity icon is,

EF = ES + D

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LF = LS + D

TF = LS – ES = LF – EF

FF = minimum ES of succeeding activity – EF of activity (for a F/S with Lag = 0)

INTF = TF-FF

INDP = minimum ES of succeeding activity – maximum LF of preceding activity – D of

activity

The start milestone is assigned an ES of zero, when the start of the project occurs at day
zero. Then the EF of each activity is calculated as EF = ES + D.

For a F/S relationship with Lag = 0, when an activity has more than one predecessor, its
ES is the maximum EF of the preceding activities since all predecessors must be
completed before this activity starts. This procedure is known as the forward pass
calculations. Once these calculations are completed the ES and EF of each activity are
known, and the project duration is also known, the EF of the end milestone determines
the project duration which is also the LF of the end milestone. The LS of the end
milestone is calculated as LS=LF – D. the LF of each activity is the same as the LS of the
succeeding activity. When an activity has more than one successor, its LF is the
minimum of the LS of the succeeding activities. This procedure is known as the
backward pass calculations. To verify the correctness of the computations, the LS which
is the ES of the start milestone should be zero. The ES, EF, LS, LF, TF, and FF of each
activity are provided below.

Its importance is that we can purposely delay the non-critical activities without affecting
the duration of the whole project, in a way that the contractors can benefit time in
another project.

The free float FF represents the amount of delay that the ES of an activity can tolerate
without delaying the project nor the ES of the successor.

If the TF of an activity is = 0 then its FF = 0 and the activity is critical.

If the FF can be 0, this does not necessitate that the TF is = 0.

The TF of an activity represents the amount of delay that the ES of an activity can
tolerate without delaying the project.

Amount of delay of an activity = Delay with respect to ES – TF of the activity.

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If the amount of delay of an activity is less than or equal to 0, then the project is not
delayed. If more than one activity is delayed, compute the delay for each activity. If the
activities are on the same path, add up the delays. If they are on independent or parallel
path, choose the larger.

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It should be noted that the total project duration is 18 days. And there are three critical
paths (TF = 0):

Start – A – C – G – I – End

Start – A – C – H – J – End

Start – B – F – End

Note that in addition to this answer, another detail must be mentioned which is the
exact date where the project ends. And this will be done by the following way:

Assuming Sundays are off, if the projects starts on Monday April 27, 2009 at 8:00 a.m., then
the last day at which the project ends is Saturday, May 16, 2009 at 5:00 p.m.

Discussion:

- If activity B is delayed (ES of B) by 2 days, how will it affect the project?

TF of B is = 0, then the project will be delayed by 2 days (delay of B – TF of B).

FF of B is = 0, then the ES of E will be delayed by 2 days (delay of B – FF of B), and

the ES of F will also be delayed by 2 days (delay of B – FF of B).

- If activity D is delayed by 2 days, how will this affect the project?

TF of D = 3, then the ES of D can be delayed by up to three days without delaying

the project, so the project will still finish on time.

FF of D = 3 (< 2), then the ES of J is not delayed.

- If activity C is delayed by 5 days and activity H is delayed by 3 days, how will this
affect the project?

TF of C = 0, then the project is delayed by 5 – 0 = 5 days because of C and,

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 TF of H = 0, then the project is delayed by 3 – 0 = 3 days because of H, and as C
and H are on the same path, then the project is delayed by 5 + 3 = 8 days.

FF of C = 0, then the ES of H is delayed by 5 – 0 = 5 days, and,

FF of H = 0, then the ES of J is delayed by 3 – 0 = 3 days.

- If activity D is delayed by 5 days and activity E is delayed by 3 days, how will this
affect the project?

TF of D = 3, then the project will be delayed by 5 – 3 = 2 days, and,

TF of E = 2, then the project is delayed by 3 – 2 = 1 days, and as D and E are not

on the same path, then the project will be delayed by the maximum between 2
and 1, that is 2 days.

FF of D = 3, then the ES of J is delayed by 5 – 3 = 2 days because of D, and FF of E

= 2 because of E, then the ES of J is delayed by 3 – 2 = 1, then the ES of J is
delayed by the larger value which is 2 days.

Question:

4- Solve Question 3 using the AOA network (F/S relationships with Lag = 0).

Answer:

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Question:

5- Solve Question 3 considering C succeeds A with F/S relation with Lag = 2.

Answer:

AON:

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 AOA:

How to solve it:

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Question:

6- If H follows C with a F/S relation with lag = 2, F follows B with a F/F relation with lag = 13
and J follows E with a S/S relation with lag = 5, solve the problem with AON network.

Answer:

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How to solve it:

Forward Path:

Backward Path:

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Note that FF of an activity (F/S) = min ES of immediate successor – EF of the activity – lag.

FF of an activity (S/S) = min ES of immediate successor – ES of the activity – lag.

FF of an activity (F/F) = min EF of immediate successor – EF of the activity – lag

FF of activity B = ES of E – EF - of B - lag = 4 – 4 = 0, and

FF of activity B = EF of F – EF of B - lag = 17 – 4 - 13 = 0, same answer.

Question:

7- If C succeeds A with a F/S relation with lag = 2, D succeeds A with a S/S with lag = 4 and
E succeeds B with a F/F relation with lag = 10, solve the problem with AON and AOA
networks.

Answer:

AON:

AOA:

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How to solve it:

Forward Path:

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26
Backward Path:

Note that FF of an activity (F/S) = min ES of immediate successor – EF of the activity – lag.

FF of an activity (S/S) = min ES of immediate successor – ES of the activity – lag.

FF of an activity (F/F) = min EF of immediate successor – EF of the activity – lag.

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Question:

If D succeeds B with a F/S relation with lag = 4, E succeeds B with a S/S with lag = 5, and F

succeeds B with a F/F relation with lag = 15, solve the problem with the AON network.

Answer:

The FF of B is:

- From D: Min ES of successor – EF of B – Lag = 8 – 4 – 4 = 0

- From E: Min ES of successor – ES of B – Lag = 5 – 0 – 5 = 0

- From F: Min EF of successor – EF of B – Lag = 19 – 4 – 15 = 0

Question:

8- Provide a schedule of work for the project (F/S with Lag = 0).

Answer:

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The end product of the network calculations is the construction of the schedule or time
charts or the Gantt charts which consist of scheduling all the activities according to the
corresponding ES, EF, LS, and LF.

Schedule of work based on ES

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 Schedule of work based on LS

Question:

9- For each activity, the following information is given:

Budgeted Quantity for the material as per BOQ, unit cost for the material, number of
manpower per day, unit rate for manpower (per day), number of machine per day, unit
rate for machine (per day).
Determine the cost of each activity and the total cost of the project.

Answer:

The total cost of each activity is the summation of the cost of material, the cost of
manpower, and the cost of machine, i.e. the cost of the resources of the project. The
total material cost of each activity is the product of the budgeted quantity and the unit
cost of each material. The total manpower cost for each activity is the product of the
manpower per day with the daily rate of manpower, and the total number of days. The
total machine cost for each activity is the product of the machine per day for each
activity, the daily rate of each machine, and the total number of days.

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Activity Quantity Unit Cost for Total Material
Material $/ Cost $
A 30 140 4200

B 24 220 5280

C 105 17 1785

D 18 38 684

E 210 15 3150

F 294 14 4116

G 36 6 216

H 48 8 384

I 105 53 5565

J 280 38 10640

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Activity Manpower per Unit Cost per day Duration (days) Total Manpower
day $/manpower/day Cost $
A 15 20 2 600

B 4 20 4 320

C 8 20 5 800

D 6 20 6 720

E 5 20 5 500

F 5 20 14 1400

G 4 20 6 480

H 5 20 4 400

I 10 20 5 1000

J 5 20 7 700

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Activity Machine per Unit Cost per Day Duration (days) Total Machine
day $/machine/day Cost $
A 1 100 2 200

B 1 120 4 480

C 1 110 5 550

D 1 50 6 300

E 1 70 5 350

F 1 80 14 1120

G 1 30 6 180

H 1 20 4 80

I 1 10 5 50

J 1 40 7 280

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Now, calculating the final total cost, and adding all the resources, we obtain the following table:

ACTIVITY MATERIAL MANPOWER MACHINE TOTAL COST

A 4200 600 200 5000

B 5280 320 480 6080

C 1785 800 550 3135

D 684 720 300 1704

E 3150 500 350 4000

F 4116 1400 1120 6636

G 216 480 180 876

H 384 400 80 864

I 5565 1000 50 6615

J 10640 700 280 11620

TOTAL 36,020$ 6,920$ 3,590$ 46,530$

The total cost of the project is:

36020$+6920$+3590$ = 46530 $

It is to be noted that this cost represents the Direct Cost of the project; the Bidding Cost is the
sum of the Direct Cost and the Indirect Costs that include the Overhead Cost and the
Contingency Cost.

Question:

10- Draw the histogram and the S-curve of the project.

Answer:

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The histogram represents the scheduled cost per day throughout the duration of the
project. It could be done based on ES or LS. Unless otherwise specified, the total cost of
each activity is divided by its duration and this result in the daily budgeted cost of each
activity. Next, allocate the daily cost of each activity referring to the already developed
schedule and last, sum up on a daily basis all the costs per day that are expected.

The S-curve represents the total cost that has occurred on a specified date.

Histogram based on ES

1 horizontal unit = 1 day

1 vertical unit = 500$

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Histogram based on LS

1 horizontal unit = 1 day

1 vertical unit = 500$

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 1 horizontal unit = 1day

1 vertical unit = 4000$

Note that this study is only true when the material, manpower, and machine’s total costs are
equally divided on the number of days along which this activity is projecting. But what if they
are not? For example:

Assume that the materials are paid on the last day of the activity, the machines are paid on the
first day of the activity, and the manpower is paid on a daily basis, then how would be the S-
curve and the histogram of this distribution look like?

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• Activity A:

Material: 0 4200

Manpower: 300 300

Machines: 200 0

500 4500

• Activity B:

Material: 0 0 0 5280

Manpower: 80 80 80 80

Machines: 480 0 0 0

560 80 80 5360

• Activity C:

Material: 0 0 0 1785

Manpower: 160 160 160 160

Machines: 550 0 0 0

710 160 160 1945

And we do the same thing for all the other activities and we will obtain the following:

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 histogram based on ES

25000

20721
20000
cost per day

15000

10000

5640
4580
5000 3530
1950 2265
1060 1210 1444
480 280 664 560 496 450 400 400 400
0

1 3 5 7 9 11 13 15 17

histogram based on LS

25000

20721
20000
cost per day

15000

10000

5520
4580 4718
5000
2615
1060 790 1380 760 500 500
680 560 496 450 400 400 400
0

1 3 5 7 9 11 13 15 17

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 S-curve
46530
25809
25009
24609
24159
23663
23103 ES
LS

5640
1060

1 3 5 7 9 11 13 15 17
# of days

Question:

11- Determine the number of manpower that is needed per day for the project.

Answer:

The same procedure that is followed in the above question is adopted, except that the
cost per day for each activity is substituted with the allocated manpower per day.

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Manpower based on ES (1unit = 1man)

Man power based on LS (1unit = 1man)

41
 Now the last procedure can be done if the manpower is the same for all
activities, but what if the manpower is of various categories? Assume the
manpower is distributed in the following way:

ACTIVITY MANPOWER
A 15/X
B 4/Y
C 8/Z
D 6/X
E 5/X
F 5/Z
G 4/Y
H 5/Y
I 10/X
J 5/Z
Where, X=10$/day

Y=15$/day

and Z=20$/day

Then, we will do the following for each activity:

Activity A: 15/X 15/X

4/Y 4/Y 4/Y 4/Y

Activity B:

8/Z 8/Z 8/Z 8/Z

Activity C:

And we continue with all the other activities until we get a whole new data that we will draw as
another histogram; this histogram will be similar to the previous one (both cases: ES and LS) but
instead of adding the number of manpower, we don't, we just write them as a function of X, Y,
and Z. The table below shows the values of manpower at each day for ES and LS, respectively:

42
 Number of Days Number of Manpower based on ES Number of Manpower based on LS

1 15/X+4/Y 15/X+4/Y

2 15/X+4/Y 15/X+4/Y

3 4/Y+8/Z+6/X 4/Y+8/Z

4 4/Y+8/Z+6/X 4/Y+8/Z

5 13/Z+11/X 13/Z

6 13/Z+11/X 13/Z+6/X

7 13/Z+11/X 13/Z+11/X

8 9/Y+11/X+5/Z 11/X+5/Z+9/Y

9 9/Y+11/X+5/Z 11/X+5/Z+9/Y

10 5/Z+9/Y 11/X+5/Z+9/Y

11 5/Z+9/Y 11/X+5/Z+9/Y

12 10/Z+4/Y 10/Z+4/Y

13 10/Z+4/Y 10/Z+4/Y

14 10/Z+10/X 10/Z+10/X

15 10/Z+10/X 10/Z+10/X

16 10/Z+10/X 10/Z+10/X

17 10/Z+10/X 10/Z+10/X

18 10/Z+10/X 10/Z+10/X

Note that the cost of manpower per day could also be obtained.

Question:

12- Activities C, D, and E need a crane and two cranes are available. Describe how the two
cranes should be distributed among the three activities.

43
Answer:

The priority is given to the activity that is critical and/or has the earliest early start.
Activities C and D have the same ES (day 2) whereas activity E has an ES of 4. The two
cranes should be allocated to activities C and D, and then the activity that finishes first
will provide its crane to activity E. so activity E may immediately succeed either activity C
or activity D. if activity E succeeds activity C, the increase in project duration is IPD CE =
EFC – LSE = 7 – 6 = 1 day. And if activity E succeeds activity D, the increase in project
duration is IPDDE = EFD – LSE = 8 – 6 = 2 days. Due to the fact that there is number of
cranes (2 cranes) and activities C, D, and E require a crane each, allocate the two cranes
to activities C and D, then once activity C finishes, allocate its crane to activity E with a
one day project delay. Note that a negative IPD means that the project will not be
delayed.

44
 Note that if 1 crane is available, allocate the crane to C first as it is a critical activity.
Then when C finishes, allocate the crane to D, and finally when D finishes, allocate it to
E.

• IPD (CD) = EF (C) – LS (D) = 7-5 = 2

• IPD (DE) = EF (D) – LS (E) = 13 (new early finish of D) – 6 = 7, so the project will be
delayed by 7 days and the total duration will be 7+18 = 25 days.

45
Question:

13- Provide a schedule taking into consideration that the maximum available daily
manpower is limited to 20.

Answer:

Answer:

Referring to question 7 where a schedule has been provided for the project showing the
daily manpower, it is observed that certain days require that the daily manpower
exceeds 20. In order that the maximum daily manpower is limited to 20, certain
activities need to be shifted (keep the same logic of the project). It is always advisable to
start shifting non-critical activities with larger total float which may result in a lesser
increase in project duration. Additionally, if the activities that could be shifted have the
same total float or if they are critical activities, advantage should be given to the
activities with lesser number of manpower per day.

46
 To level the given project based on ES, proceed as follows:

1-shift E by 1 day

2-shift E by 1 day

3-shift E by 1 day, adjust by shifting J by 1 day

4-shift H by 1 day

As observed, the project will be delayed by 1 day

Note that predecessor/successor relationship must be respected.

Now, let us provide a schedule taking into consideration that the maximum available daily
manpower is limited to 15.

47
Referring to question 7 where a schedule has been provided for the project showing the
daily manpower, it is observed that certain days require that the daily manpower
exceeds 15. In order that the maximum daily manpower is limited to 15, certain
activities need to be shifted (keep the same logic of the project). It is always advisable to
start shifting non-critical activities with larger total float which may result in a lesser
increase in project duration. Additionally, if the activities that could be shifted have the
same total float or if they are critical activities, advantage should be given to the
activities with lesser number of manpower per day.

To level the given project based on ES, proceed as follows:

1-shift B by 1 day, adjust by shifting E by 1 day and F by 1 day

2-shift B by 1 day, adjust by shifting E by 1 day and F by 1 day

3-shift D by 1 day, no adjustment is needed

4-shift D by 1 day, no adjustment is needed

5-shift D by 1 day, no adjustment is needed

6-shift D by 1 day, adjust by shifting J by 1 day

7-shift D by 1 day and E by 1 day, adjust by shifting J by 1 day

8-shift E by 1 day and H by 1 day, J will not be delayed

9-shift E by 1 day and H by 1 day, adjust by shifting J by 1 day

10-shift E by 1 day and H by 1 day, adjust by shifting J by 1 day

11-shift E by 1 day and H by 1 day, adjust by shifting J by 1 day

12-shift E by 1 day and H by 1 day, adjust by shifting J by 1 day

13-shift I by 1 day

14-shift I by 1 day

15-shift I by 1 day

16-shift I by 1 day

17-shift I by 1 day

18-shift I by 1 day

19-shift I by 1 day

48
 Note that predecessor/successor relationship must be respected.

The top numbers highlighted in yellow represent the daily manpower after leveling; however
the project will be delayed by 7 days and will take 25 days to complete instead of 18.

49
The bottom most numbers highlighted in red represent the daily manpower after leveling,
however the project will be delayed by 7 days and will take 25 days to complete instead of 18.

Question:

14- An update was done on day 14, and the actual quantities for each activity were reported
as follows:

Activity Budgeted Actual Quantity

Quantity at Day 14
A 30 30

B 24 24

C 105 105

D 18 18

E 210 126

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 F 294 147

G 36 18

H 48 24

I 105 0

J 280 0

What can you conclude about the process of work?

Answer:

It is necessary at this stage to define the percent completion for each activity which is
the ratio of the actual quantity and the budgeted quantity. Then, the remaining duration
(RD) for each activity is simply the original duration (OD) times the percent that has not
been completed.

Activity Percent Complete RD

A 100 0

B 100 0

C 100 0

D 100 0

E 60 2

F 50 7

G 50 3

H 50 2

I 0 5

J 0 7

51
 Next, determine the new project duration by drawing the following network:

The new project duration is 9 days added to the day where the update was performed
(day 14) and according to this progress of work, the project will finish in 14+9=23 days
which is larger than the original project duration (18 days), so we are behind schedule.
Note that the critical paths are start-A-C-H-J end and start-B-E-J-end.

Budgeted Budgeted Budgeted Actual Actual Actual

ACTIVITY
Material Cost Manpower Cost Machine Cost Material Cost Manpower Cost Machine Cost

A 4200 600 200 4200 600 200

B 5280 320 480 5280 320 480

C 1785 800 550 1785 800 550

D 684 720 300 684 720 300

E 3150 500 350 1500 300 200

F 4116 1400 1120 2500 500 500

G 216 480 180 100 200 100

52
 H 384 400 80 250 220 30

I 5565 1000 50 0 0 0

J 10640 700 280 0 0 0

It is important to define the cost or spending variance (CV) which is the difference
between the budgeted cost of work performed and the actual cost of work performed
CV= BCWP - ACWP

Additionally, the scheduled variance (SV) which is the difference between the budgeted
cost of work performed and the budgeted cost of work scheduled SV = BCWP - BCWS

Activity Total Budgeted Cost BCWP ACWP CV OD % Complete BCWS SV

per Schedule

A 5000 5000 5000 0 2 100 5000 0

B 6080 6080 6080 0 4 100 6080 0

C 3135 3135 3135 0 5 100 3135 0

D 1704 1704 1704 0 6 100 1704 0

E 4000 2400 2000 400 5 100 4000 -1600

F 6636 3318 3500 -182 14 71.43 4740.09 -1422.09

G 876 438 400 38 6 100 876 -438

H 864 432 500 -68 4 100 864 -432

I 6615 0 0 0 5 20 1323 -1323

J 11620 0 0 0 7 42.86 4980.30 -4980.30

Question:

15- Activity F was supposed to be 75% complete today, but it is 50% complete with actual
cost for now of $6000.

53
 What do you conclude?

Answer:

Let us note first that this update was done on 75% (OD of F = 14) = 10.5 days from the ES
(4) of F, so the update was done at day 14.5 from the start of project, i.e. between day
14 and day 15.

It is important to define the cost or spending variance (CV) which is the difference
between the budgeted cost of work performed and the actual cost of work performed
CV=(50%) (6636) – 6000 = - $2682 < 0

Additionally, the scheduled variance (SV) which is the difference between the budgeted
cost of work performed and the budgeted cost of work scheduled.

SV = (50%) (6636) – (75%) (6636) = -$1659 < 0

In addition, we can bring also the time variance TV which is the difference between the
scheduled time of work performed (STWP) and the actual time of work performed
(ATWP): TV = Thursday – Friday = -1 < 0

As a conclusion, for activity F, there is an overrun in the expenditures (CV < 0) and the
activity is behind schedule (SV < 0) and TV<0 → also delay in schedule. If we go back to
question 8, and according to the following actual data:

Question:

16- Given the crash durations and the crash cost for each activity, determine the new
project duration and project cost under crash conditions, in the scheduling phase, i.e.
before construction has started (Fast Track Project).

Answer:

As the resources (manpower and/or machine) are increased, the duration required to
complete the activity decreases which results in an increase in cost, until a duration is
reached below which it is physically impossible to complete the activity, regardless of
the level, quality, and/or cost of the resources employed. This duration is called the
crash duration that is associated with a crash cost. It is important to define the slope of
an activity which is defined as the ratio of the difference between the crash cost and the

54
normal cost, and the normal duration and the crash duration. The slope of an activity is
defined to be the daily cost increase that results from a reduction in duration of one
day. The crashing process shall be done on a day by day basis as the original critical
path(s) shall be maintained. The slope of each activity is calculated and normally, the
critical activity that has the smallest slope (i.e. lowest cost increase) is selected for a one
day reduction of the project duration. If there are several critical paths, the activities
with the smallest slopes for each path are selected, summed up, and compared with the
slopes of critical activities that are common to these critical paths. The selection that
results in the smallest daily cost increase is adopted. It is important to notice that in the
crashing procedure, the original critical path shall be maintained, in addition to newly
developed critical paths that have resulted from the crashing procedure. The crashing
procedure stops when the original critical path(s) can no longer be crashed, or when a
newly developed critical path can no longer be crashed.

Activity N o rmal N o rmal Crash Crash Slope

Cost Duration Cost Duration

A 5000 2 10000 1 5 000

B 6080 4 12000 2 2 960
C 3135 5 6000 2 9 55
D 1704 6 4000 4 1 148
E 4000 5 8000 3 2 000
F 6636 14 14000 10 1 841
G 876 6 1600 4 3 62
H 864 4 2600 2 8 68
I 6615 5 14000 3 3692.50
J 11620 7 24000 3 3 095

The three critical paths are:

Start – A – C – G – I – End with duration of 18 days.

Start – A – C – H – J – End with duration of 18 days.

Start – B – F – End with duration of 18 days.

The other non-critical paths are:

55
Start – A – D – J – End with duration of 15 days.

Start – B – E – J – End with duration of 16 days.

The smallest slope of Start – A – C – G – I – End is 362$/day (activity G)

The smallest slope of Start – A – C – H – J – End is 868$/day (activity H)

The smallest slope of Start – B – F – End is 1841$/day (activity F)

The sum of the three slopes equals to 3071$/day which represents the additional cost
that will result from reducing the total project duration to 17 days. However, since the
first path and the second path have two common activities (A and C), where the slope of
C is 955$/day, adding this slope to the slope of F (1841$/day) will result in a cost
increase of 2796$/day which is more beneficial than the first option (3071$/day). The
procedure will continue in the same manner until the original critical paths and the
newly developed paths can no longer be crashed. In brief, the following represents the
complete crashing procedure:

- Crash C + F by 1 Day add 955$ + 1841$. Original critical paths remain the same
with 17 days duration.
- As no new critical path(s) has developed, nor an activity can no longer be
crashed from the step above, repeat step 1, i.e., Crash C + F by 1 Day add 955$ +
1841$. Original critical paths remain the same with 16 days duration and a new
critical path has developed Start – B – E – J – End.
- Crash C + B by 1 Day add 955$ + 2960$. Original critical paths with Start – B – E –
J – End remain the same with 15 days duration and a new critical path has
developed Start – A – D – J – End.
C can no longer be crashed.
The other suggestions are: min(G, I), + F + E = 362 + 868 + 1841 + 2000 = 5071$,
and A + B = 5000 + 2960 = 7960$, and min(G, I) + J + F = 362 + 3095 + 1841 =
5298$, C + E + F = 955 + 2000 + 1841 = 4796$
- Crash min(G, I) + F + J by 1 Day add 362$ + 1841$ + 3095$. All paths are critical
with 14 days duration.
The other suggestions are: A + B = 5000 + 2960 = 7960$, and min(G, I) + H + F + D
+ E= 362 + 868 + 1841 + 1148 + 2000 = 6219$, A + F + E = 5000 + 1841 + 2000 =
8841$, G + H + D + B = 362 + 868 + 1148 + 2960 = 5338$
- As no new critical path(s) has developed, nor an activity can no longer be
crashed from the step above, repeat above step, i.e., Crash G + F + J by 1 Day add
362$ + 1841$ + 3095$. All paths are critical with 13 days duration.
G and F can no longer be crashed.
56
 -Crash A and B by 1 Day add 5000$ + 2960$. All paths are critical with 12 days
duration.
A and B can no longer be crashed.
Since B and F can no longer be crashed, the critical path Start – B – F – End can no longer
be crashed and the crashing procedure stops at this point with a decrease in project
duration of 6 days at an additional cost of 28063$.

New project duration after total crashing is 18 – 6 = 12 Days.

New project cost after total crashing is original cost + crash cost = 46530$ + 28063$ =
74593$.

Question:

17- Crash the project during construction, as a result of the updating procedure in question
14.
Answer:

First remove all activities that are 100% complete, which are in this case: A, B, C and D.
Then, multiply the crashed duration of each activity by (100% - % complete) of that
activity.

Activity N o rma l RD Crash Cost Crash % Crash S lo p e

Cost Duration Complete Duration

E 4000 2 8000 3 60 1 2000

F 6636 7 14000 10 50 5 1841
G 876 3 1600 4 50 2 362
H 864 2 2600 2 50 1 868
I 6615 5 14000 3 0 3 3692.50
J 11620 7 24000 3 0 3 3095

The two critical paths are

Start – A – C – H – J – End with duration of 9 days.

57
Start – B – E – J – End with duration of 9 days.

The other non-critical paths are:

Start – A – C – G – I – End with duration of 8 days.

Start – A – D – J – End with duration of 7 days.

Start – B – F – End with duration of 7 days.

The smallest slope of Start – A – C – H – J – End is 868$/day (activity H)

The smallest slope of Start – B – E – J – End is 2000$/day (activity E)

The sum of the two slopes equals to 2868$/day which represents the additional cost
that will result from reducing the total project duration to 8 days. The procedure will
continue in the same manner until the original critical paths and the newly developed
paths can no longer be crashed. In brief, the following represents the complete crashing
procedure:

- Crash H and E by 1 Day add 868$ + 2000$. Original critical paths remain the same
with 8 days duration and a new critical path has developed Start – A – C – G – I –
En d .
E and H can no longer be crashed.

- Crash J and G by 1 Day add 3095$ + 362$. Critical paths remain the same with 7
days duration and two new critical paths have developed Start – B – F – End and
Start – A – D – J – End.
G can no longer be crashed.

- Crash J, I and F by 1 Day add 3095$ + 3692.5$ + 1841$. Critical paths remain the
same with 6 days duration..
C can no longer be crashed.

- Crash J, I and F by 1 Day add 3095$ + 3692.5$ + 1841$. Critical paths remain the
same with 5 days duration..
I and F can no longer be crashed.

Since B and F can no longer be crashed, the newly developed critical path Start – B – F –
End can no longer be crashed and the crashing procedure stops at this point with a
decrease in project duration of 4 days at an additional cost of 23582$.

58
 New project duration after total crashing is 14 + 9 – 4 = 19 Days (Delay of 1 day).

New project cost after total crashing is original cost + crash cost = 46530$ + 23582$ =
70112$.

Question:

18- What is the probability that the project finishes in 1 ` 8 days or less?

Activity a b m Original Variance

Duration [(b-a)/6]2
A 1 3 2 2 0.111`
B 2 6 4 4 0.444
C 3 7 5 5 0.444
D 3 9 6 6 1
E 3 7 5 5 0.444
F 7 21 14 14 5.444
G 3 9 6 6 1
H 2 6 4 4 0.444
I 3 7 5 5 0.444
J 4 10 7 7 1

The probability that the project finishes in 18 9 days or less is:

There are 3 critical paths.:

Start – A – C – G – I – End

Start – A – C – H – J – End

Start – B – F – End

Following – A – C – G – I: P (x ≤ 19) = P (z ≤ (19 – 18)/∑(Var)1/2 = P (z ≤ (19 – 18)/ (0.111 +

0.444 + 1 + 0.444) 1/2) = P (z ≤ 0.707) = 0.75917 or 76%.

Following A – C – H – J: P (x ≤ 19) = P (z ≤ (19 – 18)/∑(Var)1/2 = P (z ≤ (19 – 18)/ (0.111 +

0.444 + 0.444 + 1) 1/2) = P (z ≤ 0.707) = 0.75917 or 76%.

59
Following B – F: P (x ≤ 19) = P (z ≤ (19 – 18)/∑(Var)1/2 =

P (z ≤ (19 – 18)/ (0.444 + 5.444) 1/2) = P (z ≤ 0.412) = 0.66 or 66%.

60