Project Management

Techniques

|Faculty | Sushant Sharma |

SUSHANT SHARMA
Contents
• Introduction-Project Management
• Project Scope Management
– Work Breakdown Structure
• Project Time Management
– Gantt Chart
– Critical Path Method &Floats
– Precedence Network Analysis
– PERT (Program Evaluation &Review Technique)
– Line of balance technique
– Time Crashing techniques
• Project Resource Management
• Monitoring & Control
- Earned Value Analysis

SUSHANT SHARMA
 Project Management

Defining Project – It is the group of inter-related activities executed in a

coordinated way to achieve the project objectives.

Defining Management –It is the efficient use of resources in set of known

processes

Project Management -It is the application of skills, knowledge, tools &techniques

to Project activities through application and integration of Project Management
Process Groups.

Characteristics of a “Project”

1. It has a definite beginning &definite end.

2. It creates a unique Product
3. Progressive Elaboration- Managing to a greater level of detail as project
evolves. (continuously improving and detailing a plan as more –detailed and
specific information and more accurate estimates becomes available)

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Project Objective /Project Constraints

What, when and how much?

A project objective has Six dimensions:

What is to be achieved (Scope)

When it is to be achieved by (Schedule), and
What achieving it will cost (Budget),
What are the specifications (Quality),
What are the risks involved(Risk),
What are the resources required (Resources)

If any constraint is subjected to change then impact on others shall be

evaluated.

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SUSHANT SHARMA

Feasibility /Define
Key Purpose
Propose a project to senior management
with a brief written document to establish a
shared understanding of the proposal before
writing a Plan, Schedule,
and Budget
Key Questions
Is this the right project?
What results should it achieve?
How will success be measured?
Key Activities
Understand stakeholder interests
and expectations
Establish a shared high-level
understanding of the proposed
project and its intended results
Key Deliverables
Project Definition Document and/or
Business Case
Moving to the Next Phase
When your Project Definition Document
and/or Business Case are approved by
senior management, move to the Plan
Phase
Four Phase Project Lifecycle
Plan
Propose a project in more detail, and
outline a clear approach for executing the
project in a Plan, Schedule, and Budget
How will the project achieve its
objectives?
When will the project finish?
Who will do what?
What will it cost?
How will risks/issues be managed?
Thoroughly plan the project activities,
schedule, and resource requirements
Provide more detailed information to
senior management for discussion and
approval
Project Plan
Project Schedule
Project Budget
When your Project Plan, Schedule, and
Budget are approved by senior management,
move to the Implement Phase
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Implement
Do the work described in the Project Plan, Shut down the project in a controlled
aligned with the Schedule and Budget
How is project work progressing?
What issues and risks does the project
face, and how should these be
managed?
How much is the project actually
costing?
Mobilize the team to execute the
Project Plan
Control the execution of the Project
Plan
Communicate with stakeholders
Report project status
Update the Project Plan, Schedule,
Budget, and Business Case as needed
Project Manual
Status Reports
Risk, Issue, and Change Logs
Updated Plans, Schedules, Budgets
As project deliverables near completion,
move to the Close Phase
Close
manner
Is the work of the project complete?
Did the project achieve its
results/outcomes?
What did the team learn that could
help other projects?
Where do project staff go next?
Demonstrate that the project is
complete
Assess the success of the project
Undertake administrative close-out
Transfer knowledge to the permanent
organization
Support departing staff
Final Acceptance Document
Lessons Learned Document
Project Archives
When this phase is complete, the project
is finished
 Project Management Processes

Initiating
Planning
Execution
Monitoring &Control
Closing

3 Important Project Management Functions:

Planning – determine what needs to be done

Scheduling – decide when to do activities
Controlling – see that it’s done right

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 Project Scope Management

Work Breakdown Structure

Tool for simplifying project objective

Tool for defining project work (scope) in term of deliverables.

Decomposition of project components on basis of effort/ cost/

responsibility.

Different from control A/c.

Processes required ensuring that the project includes work required and only
the work required. It includes:
• Collect Requirements
• Define Scope
• Create W.B.S
• Verify W.B.S
• Control W.B.S
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 WBS Tree Structure
Project

Sub Project Sub Project Sub Project

A B C

Task 1 Task 2 Task 3 Task 4 Task 5 Task 6 Task 7

Work Package 'X' Work Package 'Y'

Activity 1 Activity 2 Activity 3

Operation 'P' Operation 'Q' Operation 'R'

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 Divide the project work scope in terms of
deliverables

Select a deliverable
Process of creating
a WBS

Can adequate duration

estimate be determined for the
deliverable & can the work be
assigned to an Engineers/ No
Supervisors
Yes

Identify a constituent element using tangible &

verifiable outcome

No Does deliverables
accounts for 100%
Further divide the deliverable into work scope & are all internal
packages & further into activity which can be external & project
No assigned to a Foreman and can be estimated management deliverable
realistically has being included

Are all deliverables Yes

accounted for ?

Yes

Draw WBS diagram

Communicate and take consent of stakeholders

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 Principles of WBS

1. The 100% Rule – Project Scope/Work Packages shall capture all the deliverables – internal ,external
,interim – in terms of works to be completed including project Management.

2. The deliverables should be logically decomposed to the level that represents how they will be
produced (designed, purchased, subcontracted, and fabricated). The partitioning of deliverables
from higher level with in the WBS to lower levels must be logically related.

3. Deliverables should be clearly defined to eliminate duplication of effort within WBS elements,
across organizations, or between individuals responsible for completing the work.

4. Deliverables should be limited in size and definition for effective control – but not so small as to
make cost of control excessive and not so large as to make the item unmanageable or the risk
unacceptable.

5. The PM should structure the project work into WBS elements (work packages) that are:

Tangible - real objects that can be seen felt & sensed and are not imaginary, vague or elusive. Should be
definable and easily understood by project participants.

Measurable – can be used to measure progress in quantitative terms using standard measurements.

Verifiable – the specified measures should be verifiable by any agency at the time of delivery and
acceptance.

Manageable – a meaningful unit of work where specific responsibility and authority can be assigned to a
responsible individual.

Estimatable – duration can be estimated in time required to compete, and cost can be estimated in
resources required to complete.
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 Independent – minimum interface with or dependence on other ongoing elements (i.e. assignable to a single
control account, and clearly distinguishable from other work packages).

Integratable – integrates with other project work elements and with higher level cost estimates and schedules to
include the entire project.

Adoptable – sufficiently flexible so the additions/ elimination of work scope can be readily accommodated in the
WBS.

6. A work package is a piece that:

• Can be realistically and confidently estimated

• Can not be logically subdivided further

• Can be completed quickly

• Has a meaningful conclusion and is deliverable

• Can be completed without interruption (without the need for more information) and

• Will be outsourced or contracted out.

There is a general ‘5% Rule’ that states that all and any Work Package should be about 5% of Project
duration.

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 Gantt-charts
Gantt-charts/Bar charts can be considered as
tools for portraying a project plan.
Gantt-Chart indicates the general sequence of
work tasks
It is an effective visual device showing the period
of commencement and duration of work in time
units of –Days, Weeks or Months of a Year.
It indicates the status of progress as per the
schedule.
Left side of the Gantt- chart contains the sheet
view and the right side the bar graph along a time
scale. SUSHANT SHARMA
 Scheduling

• A schedule is a conversion of a project action plan into an

operating timetable. In other words it shows the timing of
work elements and denote when specific events and
milestones take place.

• As such it serves as the basis for allocation of resources,

cost estimation and project performance and thus the basis
of monitoring and controlling project activity. Taken together
with plan and budget, it probably is the major tool for
management of projects.

• Activity Based Scheduling –(Critical Path)

• Location Based Scheduling –(Line of Balance)

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 NETWORK

• Schematic display of the logical relationships of

project activities. Also referred to as a “PERT chart.”.
Time
Correct sequence of activities and events.
• Graphical portrayal of activities and event
• Shows dependency relationships between tasks/activities
in a project
• Clearly shows tasks that must precede (precedence) or
follow (succeeding) other tasks in a logical manner
• Clear representation of plan – a powerful tool for planning
and controlling project.

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 DEFINITION OF TERMS IN A NETWORK

• Activity : : It represents the actual work planned as process

of doing something. any portions of project (tasks)
which required by project, uses up resource and
consumes time – may involve labor, paper work,
contractual negotiations, machinery
operations Activity on Arrow (AOA) showed as
arrow, AON – Activity on Node
• Event : beginning or ending points of one or more
activities, instantaneous point in time, also called
‘nodes’

• Network : Combination of all project activities and the events

PRECEEDING SUCCESSOR
ACTIVITY

EVENT

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Emphasis on Logic in Network Construction
• Construction of network should be based on logical or technical
dependencies among activities
• Example - before activity ‘Approve Drawing’ can be started the
activity ‘Prepare Drawing’ must be completed
• Common error – build network on the basis of time logic (a feeling for
proper sequence ) see example below

WRONG !!! CORRECT

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 Example 1
Develop the network for a project with following activities and
immediate predecessors:
Activity Immediate
predecessors
A -
B -
C B
D A, C
E C
F C
G D,E,F
Try to do for the first five (A,B,C,D,E) activities

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Network of first five activities

A D
1 3 4

E
B

C 5

2
We need to introduce
a dummy activity

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 Network of Seven Activities
1 A 3 D 4 G
7
dummy E
B
C 5 F
2 6

Note how the network correctly identifies D, E, and F as the

immediate predecessors for activity G.

Dummy activities is used to identify precedence relationships

correctly and to eliminate possible confusion of two or more
activities having the same starting and ending nodes

Dummy activities have no resources (time, labor, machinery, etc) –

purpose is to PRESERVE LOGIC of the network

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 EXAMPLES OF THE USE OF DUMMY ACTIVITY
Network concurrent activities
a
a 2

1 2 1 Dummy

b 3
b
WRONG!!! RIGHT

Activity c not WRONG !

required for e
a
a e
d
1
b 1 e b
d
c
2
c
WRONG
RIGHT
!!!
RIGHT

SUSHANT SHARMA
 WRONG!!! RIGHT!!!

a d a d
1 1

b e b
2 2 4
e

c f c f
3 3

a precedes d.
a and b precede e,
b and c precede f (a does not precede f)

Dummy Activity is used to provide a logical link to maintain the correct relationship of activities.

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 Scheduling with activity time
Activity Immediate Completion
predecessors Time
(week)
A - 5
B - 6
C A 4
D A 3
E A 1
F E 4
G D,F 14
H B,C 12
I G,H 2
Total …… 51
This information indicates that the total time required to complete activities
is 51 weeks. However, we can see from the network that several of the
activities can be conducted simultaneously (A and B, for example).

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 Earliest start & earliest finish time
• We are interested in the longest path through the network,
i.e., the critical path.

• Starting at the network’s origin (node 1) and using a

starting time of 0, we compute an earliest start (ES) and
earliest finish (EF) time for each activity in the network.

• The expression EF = ES + t can be used to find the

earliest finish time for a given activity.
For example, for activity A, ES = 0 and t = 5; thus the
earliest finish time for activity A is
EF = 0 + 5 = 5

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 Arc with ES & EF time
EF = earliest finish time

ES = earliest start time

Activity

1
t = expected activity
time

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 Network with ES & EF time
D[5,8] 5
2 3

7
4

1 6

Earliest start time rule:

The earliest start time for an activity leaving a particular node is equal to
the largest of the earliest finish times for all activities entering the node.

SUSHANT SHARMA
 Activity, duration, ES, EF, LS, LF
EF = earliest finish time

ES = earliest start time

Activity

2
LF = latest finish time
LS = latest start time

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 Latest start & latest finish time

• To find the critical path we need a backward pass calculation.

• Starting at the completion point (node 7) and using a latest

finish time (LF) of 26 for activity I, we trace back through the

network computing a latest start (LS) and latest finish time for

each activity

• The expression LS = LF – t can be used to calculate latest start

time for each activity. For example, for activity I, LF = 26 and t =

2, thus the latest start time for activity I is

LS = SUSHANT
26 – 2 = 24
SHARMA
 Network with LS & LF time

D[5,8] 5
2 3[7,10]

7
4

1 6

Latest finish time rule:

The latest finish time for an activity entering a particular node is equal to
the smallest of the latest start times for all activities leaving the node.

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 Slack or Free Time or Float
Slack is the length of time an activity can be delayed without affecting the
completion date for the entire project.
For example, slack for C = 3 weeks, i.e Activity C can be delayed up to 3
weeks
3
(start anywhere between weeks 5 and 8).
2
ES LS EF EF
5 8 9 12

LF-EF = 12 –9 =3

LS-ES = 8 – 5 = 3

LF-ES-t = 12-5-4 = 3

SUSHANT SHARMA
 Activity schedule for our example
Activity Earliest Latest Earliest Latest Slack Critical
start (ES) start (LS) finish (EF) finish (LF) (LS-ES) path

A 0 0 5 5 0 Yes
B 0 6 6 12 6
C 5 8 9 12 3
D 5 7 8 10 2
E 5 5 6 6 0 Yes
F 6 6 10 10 0 Yes
G 10 10 24 24 0 Yes
H 9 12 21 24 3
I 24 24 26 26 0 Yes
SUSHANT SHARMA
 IMPORTANT QUESTIONS
• What is the total time to complete the project?
– 26 weeks if the individual activities are completed on schedule.

• What are the scheduled start and completion times for each activity?
– ES, EF, LS, LF are given for each activity.

• What activities are critical and must be completed as scheduled in order

to keep the project on time?
– Critical path activities: A, E, F, G, and I.

• How long can non-critical activities be delayed before they cause a

delay in the project’s completion time
– Slack time available for all activities are given.

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 Importance of Float (Slack) and
Critical Path
1. Slack or Float shows how much allowance each activity
has, i.e. how long it can be delayed without affecting
completion date of project

2. Critical path is a sequence of activities from start to finish

with zero slack. Critical activities are activities on the
critical path.

3. Critical path identifies the minimum time to complete

project

4. If any activity on the critical path is shortened or extended,

project time will be shortened or extended accordingly
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 Importance of Float (Slack) and Critical
Path (cont)
5. So, a lot of effort should be put in trying to control activities along this
path, so that project can meet due date. If any activity is lengthened,
be aware that project will not meet deadline and some action needs
to be taken.

6. If can spend resources to speed up some activity, do so only for

critical activities.

7. Don’t waste resources on non-critical activity, it will not shorten the

project time.

8. If resources can be saved by lengthening some activities, do so for

non-critical activities, up to limit of float.

9. Total Float belongs to the path

SUSHANT SHARMA
 Calculation of ES, EF, LF, LS, and Slack

GOING FORWARD
• ES = Maximum of EF’s for all predecessors
• EF = ES + t
GOING BACKWARD
• LF = Minimum of LS for all successors
• LS = LF – t
• Slack = LS – ES = LF – EF

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Precedence Network Analysis
(PNA/PDM/AON)

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 Precedence Network Analysis
Elements of PNA Network

A rectangular or a square box represents each activity in

a Precedence Network (PN).
The boxes portray activities–on–nodes, unlike the
CPM/PERT networks, which show activities–on–
arrows.
The time duration of the activity is incorporated inside
the nodal box
The logic relationship in a PN is shown by connecting
the activity nodes with lines drawn from the preceding
activity
The procedure for drawing a PN is similar to that of
drawing a CPM, but its model presents a different look.
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SUSHANT SHARMA
• Network logic/Activity Relationships/Task
Dependencies - Generally, the extreme left vertical side of
the activity box marks the start of the activity and the
extreme right, its completion. The connecting lines show
the relationship among the various activities. Connecting
them with lines indicates the logic between the activities.
The length of these lines has no significance. Generally,
they move from left to right. Arrowheads are not necessary.
A PN can represent four types of precedence relationships.
See the figure given below. These are:

• Finish–to–Start.
• Start–to–Start.
• Start–to–Finish.
• Finish-to-Finish.
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Types of Precedence
Relationships

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• R e l a t i o n s h i p s are always defined from a preceding activity to its
successor activity.

• Lag means the delay from start or finish of an activity to its successor. It
can be specified in positive or negative time units. Lead implies a
negative lag.

• Duration estimation. PNA uses the one–time estimate for activity

duration estimation. The three–time estimate of activities can also be
used in a PN. In such cases, the analysis of the network is carried out by
reducing the three–times estimate to a single expected time and then
proceeding in a manner similar to the PERT.

• Activity numbering The activity numbering methodology is similar to the

CPM. Numbering commences from the start activity and finishes with the
last one. It is a standard practice to number the activities after the
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network model is finalized.
 Preparation
of
PNA networks
(examples)

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SUSHANT SHARMA
PROGRAM EVALUATION
AND REVIEW TECHNIQUE
- PERT

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 PERT For Dealing With Uncertainty

• So far, times can be estimated with relative certainty, confidence

• For many situations this is not possible, e.g Research,

development, new products and projects etc.

• If the activity times are not known with certainty, PERT/CPM can
be used to calculate the probability that the project will complete
by time t.
• For each activity, make three time estimates:
– Optimistic time: o
– Pessimistic time: p
– Most-likely time: m

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 Beta Distribution
Assumption: The variability of the time estimates follows the
beta distribution.

Beta distribution

0 o m p
Elapsed time

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 Example
2-4-5 3-4-6
b d

0 2-3-4 0
START a FINISH

1-3-7 2-3-8
c e

Question: What is the probability that the project will be finished by day 12?

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 PERT with Uncertain Activity
Durations
Goal: Calculate the probability that the project is
completed by time t.
Procedure:
1. Calculate the expected duration and variance for each
activity.

2. Calculate the expected length of each path. Determine

which path is the mean critical path.

3. Calculate the standard deviation of the mean critical path.

4. Find the probability that the mean critical path completes

by time t.

SUSHANT SHARMA
Expected Duration and Variance for
Activities (Step #1)
• The expected duration of each activity can be approximated as follows:

o 4m p
6

• The variance of the duration for each activity can be approximated as

follows:
2
2 p o
6

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Expected Length of Each Path (Step #2)

• The expected length of each path is

equal to the sum of the expected
durations of all the activities on each
path.

• The mean critical path is the path with

the longest expected length.

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Standard Deviation of Mean Critical
Path (Step #3)
• The variance of the length of the path is the
sum of the variances of all the activities on the
path.
s2path all activities on path s 2

• The standard deviation of the length of the path

is the square root of the variance.
2
path path

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 Probability Mean-Critical Path
Completes by t (Step #4)
• What is the probability that the mean critical path (with expected length tpath and
standard deviation spath) has duration t?
t (t path)
• Use Normal Tables z
path

Probability
Density
Function

3 2 tpath + +2 +3

Path duration

SUSHANT SHARMA
Expected Duration and Variance of Activities
(Step #1)
2
Activity o m p
o 4m p 2 p o
6 6
a 2 3 4 3.00 1/
9

b 2 4 5 3.83 1/
4

c 1 3 7 3.33 1
d 3 4 6 4.17 1/
4

e 2 3 8 3.67 1

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Expected Length of Each Path
(Step #2)
Path Expected Length of Path

a-b-d 3.00 + 3.83 + 4.17 = 11

a-c-e 3.00 + 3.33 + 3.67 = 10

The mean-critical path is a - b - d.

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Standard Deviation of Mean-Critical
Path (Step #3)

• The variance of the length of the path is the sum of

the variances of all the activities on the path.
s2path = all activities on path s2 = 1/9 + 1/4 + 1/4 = 0.61

• The standard deviation of the length of the path is

the square root of the variance.

2
path path 0.61 0.78

SUSHANT SHARMA
Probability Mean-Critical Path Completes
by t=12 (Step #4)

• The probability that the mean critical path (with expected length
11 and standard deviation 0.71) has duration 12?

t (t path) 12 11
z 1.41
path 0.71

• Then, from Normal Table: Prob(Project 12) = Prob(z 1.41) =

0.92

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SUSHANT SHARMA
Example -2 Precedence and Project Activity Times
Immediate Optimistic Most Likely Pessimistic EXP Var S.Dev
Activity Predecessor Time Time Time TE V

a - 10 22 22 20 4 2
b - 20 20 20 20 0 0
c - 4 10 16 10 4 2
d a 2 14 32 15 25 5
e b,c 8 8 20 10 4 2
f b,c 8 14 20 14 4 2
g b,c 4 4 4 4 0 0
h c 2 12 16 11 5.4 2.32
I g,h 6 16 38 18 28.4 5.33
j d,e 2 8 14 8 4 2

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The complete network

d 6
2
(15,25)
j
a (8,4)
(20,4) e
(10,4)
1 f 7
3
b (14,4)
(20,0)
g
c
(4,0)
(10,4) i
(18,28.4)
h 5
4
(11,5.4)

SUSHANT SHARMA
Figure The complete Network

EF=20 35
d 6
2
a (15,25) j
(20,4) (8,4)
b e
20 43
(20,0) (10,4)
f CRIT. TIME = 43
1 3 7
(14,4)
g
c (4,0)
(10,4) i
(18,28.4)
h 5
4
(11,5.4)
10 24

SUSHANT SHARMA
 Critical Path Analysis (PERT)
Activity LS ES Slacks Critical ?
a 0 0 0 Yes

b 1 0 1

c 4 0 4

d 20 20 0 Yes

e 25 20 5

f 29 20 9

g 21 20 1

h 14 10 4

i 25 24 1

j 35 35 0 Yes

SUSHANT SHARMA
Assume, PM promised to complete the project in the fifty days.
What are the chances of meeting that deadline?
Calculate Z, where

Z = (D-S) / V

Example,
D = 50; S(Scheduled date) = 20+15+8 =43; V = (4+25+4)
=33
Z = (50 – 43) / 5.745
= 1.22 standard deviations.

The probability value of Z = 1.22, is 0.888

1.22

SUSHANT SHARMA
What deadline are you 95% sure of meeting

Z value associated with 0.95 is 1.645

D = S + 5.745 (1.645)
= 43 + 9.45
= 52.45 days

Thus, there is a 95 percent chance of finishing the project by

52.45 days.

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 Comparison Between CPM and PERT
CPM PERT

1 Uses network, calculate float or slack, identify

critical path and activities, guides to monitor and Same as CPM
controlling project

2 Uses one value of activity time Requires 3 estimates of activity time

Calculates mean and variance of time

3 Used where times can be estimated with Used where times cannot be estimated with
confidence, familiar activities confidence.
Unfamiliar or new activities

4 Minimizing cost is more important Meeting time target or estimating percent

completion is more important

5 Example: construction projects, building one off Example: Involving new activities or products,
machines, ships, etc research and development etc

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 Linear Scheduling Method
LINE OF BALANCE TECHNIQUE

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Illustration (Line of BALANCE)

Prepare an LINE OF BALANCE for construction of Viaduct (segmental

Construction)of 3.3 kms with 30 m spans of 18 m carriageway width.

Project duration = 18 months

Foundation –Bored CIS piles of 1200mm dia – 6 nos for each Pier location
Substructure-Pile cap
Each span has 12 segments of 2.5 m width
Minimum 28 days curing period to be considered for Girder segments
Launching to be done by Span by span erection using overhead Launching Girder
2 months for Finishing Works to be provided.

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SUSHANT SHARMA
SUSHANT SHARMA
Line of Balance is a Project Management technique in which the production is modeled in terms of time
and location indicating milestones for the project.

The LOB is based on the underlying assumption that the rate of production for an activity is uniform or
the production rate of the activity is linear where time is plotted on one axis , usually horizontal , and units
of stages of the activity on other axis .

The production rate of any activity is the slope of the production line and is expressed in terms of units per
time

It is primarily used for scheduling involving construction of a large number of repetitive works
such as similar

-Buildings and multistoried skyscrapers

-Linear type segmented works like roads
-Viaduct construction
-Oil &Gas Pipeline projects

This is a visual scheduling technique that allows the planner to explicitly account for flow of project. It uses
lines in diagrams to represent different types of work performed by various functional. In LOB all critical
activities are presented in the departments that work on specific locations in a project.
Analysis consists of: (Timing of Activities)
Same activity on several locations at the same time
Activities cross and order of completion changes.
Several activities start/ or end at the same time.
Dependencies between tasks are missing or estimated wrong.

Synchronization means that all the activities have similar production rate.
Pacing means that the activities to continue from one location to another without interruptions.
SUSHANT SHARMA
Steps for conducting Line of Balance Technique

1. Prepare a Work breakdown structure for the job

2. Prepare a macro schedule depicting major structures, start date and finish date based on the
backward planning. Provide suitable lags for hard logics and preliminary works
3.Prepare a logic diagram of a work cycle prepare a line of balance chart with “time “ on X axis
and “pier location” on Y axis
4.Draw the LOB work schedule. Draw the LOB line for each work package /structure based on
progress rate. Tabulate the scheduling data of a work cycle.
Sno Structure Scope No of months Progress rate Resources
required
1 Piling
Pile cap
Pier
Pier cap
S Segment casting
Segment Launching

5. Calculate the resource sets requirement and set the location-wise movements.
6. Checking the line of balance schedule

a) Choice of sections and order of completion match contracted plan and client requirements.
b )No free work points.
c )Margin allowed for disturbances.
D Time, inspection and certification.
Tasks paced and synchronized.
Labor availability at peak and in line with target.
Concrete hardening time and contractual constraints taken into consideration

SUSHANT SHARMA
 RESOURCE ANALYSIS AND SCHEDULING

Ability to carry out projects depend on the availability

of resources

Analyze resource implication

-How requirements can be met and changes needed

Use resources efficiently

Use network to give information about time, resources

and cost

SUSHANT SHARMA
Activities D, E, F, G and H require fitters.
Construct a bar chart with activities at their EST indicating person required
and total float.

D 22222222

E 222222
Activity

F 22

G 2222

H 4 4 44 444 44444

0 5 10 15 20
Time
Add up across all activities to get the total number of men required.

SUSHANT SHARMA
 Convert the bar chart to a histogram

Total number of man required

14
13
12
11
10
9
8
7
6
5
4
3
2
1
0 5 10 15 20
Time
Resource analysis before scheduling
Shows: i) Variation from week to week (fitters)
ii) Maximum number of person required (12) during
week 5-6
Examine resource implication.

SUSHANT SHARMA
Example
If only 8 fitters are available at any period during the projects:

New bar chart:

D 22222222

E 222222
Activity

F 22

G 2222

H 4 4 44 444 44444

0 5 10 15 20
Time

SUSHANT SHARMA
Additional Restriction – no fitters available until the end of
week 5.

Revised Schedule:

D 22222222

E 222222
Activity

F 22

G 2222

H 4 4 44 444 44444

0 5 10 15 20
Time

SUSHANT SHARMA
Resource constraints relates to:
1. Variations in resource requirements
2. Resource availability

Smaller variations:
1. Easier control of the job
2. Better utilization of resources

Big variations:
1. Frequent moving of manpower
2. Require close control
3. Affect efficiency
SUSHANT SHARMA
Total number of man required

0 1
Time

Histogram showing large resource variations

SUSHANT SHARMA
RESOURCE SMOOTHING
It is a network technique used for smoothening peak resource requirement during periods of the project network.

Under this technique the total project duration is maintained at the minimum level. For example, if the duration of a project is
15 days, then the project duration is maintained, but the resources required for completing different activities of a project are
smoothened by utilizing floats available on non critical activities.

These non critical activities having floats are rescheduled or shifted so that a uniform demand on resources is achieved. In
other words, the constraint in the case of resource smoothing operation would be on the project duration time. Resource
smoothing is a useful technique or business managers to estimate the total resource requirements for various project activities.

In resources smoothing, the time-scaled diagram of various activities and their floats (if any), along with resource requirements
are used. The periods of maximum demand for resources are identified and non critical activities during these periods are
staggered by rescheduling them according to their floats for balancing the resource requirements

RESOURCE LEVELLING
•It is also a network technique which is used for reducing the requirement of a particular resource due to its paucity.

•The process of resource leveling utilize the large floats avail-able on non-critical activities of the project and thus cuts down
the demand on the re-source.

•In resource leveling, the maximum demand of a resource should not exceed the available limit at any point of time. In order
to achieve this, non critical activities are re-scheduled by utilizing their floats. Some times, the use of resource leveling may
lead to prolonging the completion time of the project. In other words, in resource leveling, con-straint is on the limit of the
resource availability.

SUSHANT SHARMA
PROJECT TIME CRASHING

SUSHANT SHARMA
Problem
A small project is having seven activities. The relevant data about these activities is given below:

Activity Dependence Normal Crash Normal Crash

Duration duration cost cost
(days) (days) Rs. Rs.
A -- 7 5 500 900
B A 4 2 400 600
C A 5 5 500 500
D A 6 4 800 1,000
E B,C 7 4 700 1,000
F C,D 5 2 800 1,400
G E,F 6 4 800 1,600

(i) Find out the normal duration and the minimum duration.
(ii) What is the percentage increase in cost to complete the project in 21 days?

SUSHANT SHARMA
SUSHANT SHARMA
Step –1: Various paths of the network are given below:
1.With duration = 25 days
2.With duration = 24 days
100 = 15.5%. 3.With duration = 23 days
4.With duration = 24 days
In order to determine the cost of completing the project in 21 days, let us crash that activity on the critical path, which
has minimum cost slope. It can be seen that the minimum cost slope of Rs.100 corresponds to activity E (4-6) and it
lies on the critical path. Hence, we crash activity E (4 –6) by 1 day at an additional cost of Rs. 100.
Step- 2: Various paths now are:
1.With duration = 24 days
2.With duration = 23 days
3.With duration = 23 days
4.With duration = 24 days
An examination of the above four paths clearly points out that there are two critical paths namely 1-2-3-4-6-7 and 1-2-5-
6-7, each with duration = 24 days. To reduce the project duration by three days more, there are following possible
combination of activities.

Crash activities 4-6 on the path 1-2-3-4-6-7 and 5-6 on the path 1-2-5-6-7 by one day each at an addition cost of Rs. 100
+Rs. 200 = Rs. 300.
2. Crash activities 4-6 on path 1-2-3-4-6-7 and 2-5 on path 1-2-5-6-7 by one day each at an additional cost of Rs. 100
+Rs. 100 = Rs. 200
3. Crash activity 1-2 by one day at an additional cost of Rs. 200.
It can be observed that the additional cost of reducing the project duration by one day in combination 2 as well as
combination 3 is Rs. 200. Hence any of these two can be selected for crashing. However, since crashing activity 1-2 by
1 day reduces the duration of all the paths by1 day, we will crash it by I day. The project duration becomes = 23 days at
an additional cost = Rs. 200.
Step 3: Crash activity 1-2 by 1 day further, it would reduce the project duration to 22 days at an additional cost = Rs. 200.
Step 4: Activity 1-2 can not be crashed further. So, we now select the combination 2 stated above for crashing. Crash
activities 4-6 and 2-5 by one day each at an additional cost of Rs. 100 +Rs. 100 = Rs. 200.
Hence, in order to complete the project in 21 days, an additional cost of Rs. 100 +Rs. 200 +Rs. 200 +Rs. 200 = Rs. 700
will be incurred.
The normal cot of completing the project in 25 days =Rs. 4,500.
Hence, the percentage increase in cost to complete the project in 21 days = 100 = 15.5%.
Rs.700
SUSHANT SHARMA Rs.4,500
 Purpose of Time Crashing
• To meet the Management’s need for the early completion of the
project with acceptable cost to be paid for gaining time.

• To avoid delays which may attract heavy penalty or loss of goodwill.

• To venture on other project.

• To earn early bonus for early completion, if contractual.

• To transfer the resources needed elsewhere.

• To confirm to the resource availability schedule.

SUSHANT SHARMA
Methods of Compressing the Schedule

1. Increasing the work effort of Driving Resources.

2. By the application of time crashing techniques. wherein the duration is

reduced at the expense of cost by the use of Total floats.

3. Fast tracking – a technique in which phases or activities normally

performed in sequence are preformed in parallel

4. By altering the Calendar's Working days

5. By increasing the no of working hrs per day

6. By increasing the no of driving resources

7. By altering the Work methodology (applying more mechanized

methods) SUSHANT SHARMA
• Schedule Compression

Shortening critical path activities

Shortening early activities

Shortening longest activities

Shortening easiest activities

Elimination of some parts of the project

Addition of more resources

Substitution of less time-consuming components or activities

SUSHANT SHARMA
 Project Crashing
(Time cost trade off technique)
• Crashing a project involves paying more money to complete a project more
quickly.

• Since the critical path determines the length of a project, it makes sense to
reduce the length of activities on the critical path.

• CP activities should be reduced until the project is reduced to the desired

length or you are paying more per day than you save.

• If you have multiple CPs, they should be shortened simultaneously.

• Analyze cost & schedule tradeoff’s to determine how to obtain the greatest
amount of compression for the least incremental cost.

SUSHANT SHARMA
Time –Cost Trade off Technique
• The difference between the =(normal time and crash time of an
activity indicates its potential to undergo crashing . The slope of the
activity cost function shows the rate of increase of cost , with the
reduction in time for the activity.

• Crashing potential /Compression Potential = Normal time-Crash

time

• Rate of crashing/slope = (Crash cost-Normal cost )

(Normal Time –Crash Time)
Where: slope = cost per day of crashing a project

When slope is negative : indicate the time required for a project is

decreased, the cost is increased

SUSHANT SHARMA
 Procedure for performing
Time crashing
Time analyze the network & determine the critical path
Tabulate normal and crash duration and normal & crash cost
for all the activities.
Estimate activity crashing potential for each activity.
Determine the rate of crashing of all activities.
Crash activities beginning with the activity having least rate
of crashing .Each activity is shortened until its crashing
potential is exhausted , or a new critical path is found.
If a new critical path is formed, reduce the combination of
critical activities having the combined lowest rate of crashing
, and continue till there is no more scope of crashing .
At each crashing incorporates the cost implication in a table.

SUSHANT SHARMA
 Which Activities are the Best
Candidates for Crashing?
• Any activity that is on the critical path
• Activities with relatively long durations
• Bottleneck activities (that appear on multiple
critical paths)
• Activities with relatively low costs to crash
• Activities that are not likely to cause quality
problems if crashed
• Critical Activity with least cost slope
• Activities that occur relatively early in the schedule
and are labor intensive

SUSHANT SHARMA
 PERT CPM
PROGRAM Evaluation & Review Technique Critical Path Method

Event Oriented Activity Oriented

Activity on Arrow type diagrams are more suitable for
drawing network
Time estimates are based on ‘expert’ opinion due to lack of
past experience on identical tasks
There is no direct relationship established between the
efforts spent on activity and the results obtained
Activity on Node type diagrams are more suitable for
drawing network
Time estimates are based on past experience, data based
on past experience, data base or manuals for similar activities
Direct relationship is established between the efforts spent
and the results obtained

Duration = Total Work

Output per Unit Time x No. of Resources
Probabilistic estimates for activity duration assuming Deterministic estimates for activity duration assuming
uncertainty certainty
Uses three time estimates – optimistic, most likely and Uses a single time estimate
pessimistic to calculate average
The Longest path duration in the network based on Project duration is determined and delivery commitments
average times indicates only 50% possibility of completing can be made on the basis of the longest path known as
project within that duration ‘Critical path’
Activity crashing is not possible by putting additional Activities can be crashed by putting additional efforts. Time
efforts, resources or funds cost trade off can be achieved
Focus is on timely completion of various stages and the Focus is completion of project on time and within the
project. The cost and budget is given a secondary importance budgeted costs
progress review can be taken only at occurrence of an Progress review is done periodically at fixed intervals.
event or completion of certain stage. Activity progress can not Activity progress can be assessed and measured at any point
be assessed at any interim stage. of time between its start and finish
Applicable generally for research, product development & Applicable generally for engineering and commercial
projects of strategic importance to the organization SUSHANT SHARMA
projects
Project Control Process:

Project control provides the systems and procedures to track and control the project’s scope, cost /Resources
,specifications, risk and schedule to support project managements objective of delivering a scope that meets project
requirements, within the budget and on schedule &specifications . Scope, cost/Resources , schedule, specifications ,risk
are interdependent on a project. For example a change that increases the project scope typically is associated with an
increase to the project cost or schedule or all .

Project control compares actual performance with plan (baseline), identifies variances and corrects adverse
variances.

Establish a control baseline

Track project performance against the baseline

Continually forecast performance at completion and compare to

the baseline

Identify changes to the project and assess their impact on

performance against the baseline

Take management action to correct adverse forecast and/ or

change variances

SUSHANT SHARMA
 Understanding Project Control &
reporting Performance through
EARNED VALUE MANAGEMENT

SUSHANT SHARMA
 Earned Value Management Example
Task – Construction of a building
• Project Duration:4 Days
• Project Budget: Rs. 4,000 (i.e. BAC – Budget at completion)

Plan Day 1 Day 2 Day 3 Day 4

Rs. 1,000 Rs. 1,000 Rs. 1,000 Rs. 1,000

It is Planned Value (PV) = Budgeted Cost of Work Scheduled (BCWS)

But on Day 1, Only 75% of progress achieved and actually money spent to complete 75%
of works = Rs. 900.

It is Actual Cost (AC) = Actual Cost of Work Performed (ACWP)

SINCE ON Day 1, only 75% of progress achieved, idly expenditures should be Rs. 750.
It is Earned Value (EV) = Budgeted Cost of Work Performed (BCWP)

SUSHANT SHARMA
 Earned Value Management Example
Performance Report: As on Day 1:

• Schedule Variance (SV) = EV – PV

• Schedule Performance Index (SPI)
• Cost Variance (CV)
• Cost Performance Index (CPI)
• Cost Schedule Index (CSI)
= 750 – 1000 = -250
= EV/ PV
= 750/ 1000 = 0.75
= EV – AC
= 750 – 900 = -150
= EV/ AC
= 750/ 900 = 0.83
= SPI x CPI
= 0.75 x 0.83 = 0.62

Behind
On Schedule Ahead Schedule
Schedule
If SV is Zero -ve +ve
If SPI is 1 Less than 1 More than 1
Within Budget Over Budget Under Budget
If CV is Zero -ve +ve
If CPI is 1 Less than 1 More than 1

SUSHANT SHARMA
 Earned Value Management Example

The closer the CSI is to 1, the more likely the project’s can be
recovered from it’s deviation to the original baseline.

Forecasting Figure (based on current performance)

• Estimate at Completion (EAC)

(How much do I require at completion of the Project?)
EAC = BAC/ CPI = 4000/ 0.83 = 4819

• Estimate to complete (ETC)

(How much do I need for remaining Project?)
ETC = EAC – AC = 4819 – 900 = 3919

• Variance at Complete (VAC)

VAC = BAC – EAC = 4000 – 4819 = -819

SUSHANT SHARMA
(June’2012 )Example 1 :Activity details of a Construction Projects are as below
Activity Duration Budgeted Preceding
(weeks) Cost (Rs in Activity
Lacs)
A 4 20 -
B 5 10 A
C 8 16 A
D 5 25 B
E 4 8 B,C
F 3 12 B,C
G 4 12 D
H 4 6 E

ACTUAL STATUS BY THE END OF 10TH WEEK IS AS UNDER

Activity % complete Actual
Expenditure
(Rs in Lacs)
A 100% 22
B 100% 9
C 60% 12
D 40% 10
E 0% 0
F 0% 0
G 0% 0
H 0% 0 SUSHANT SHARMA
 Determine :
(i) Earned Value
(ii) Cost &Schedule variances
(iii) CPI&SPI
(iv) Projected cost overrun and time overrun till project completion

QUESTION STATUS AS ON END OF 10TH WEEK

Duratio % Scheduled Scheduled Planned % Actual %

Budgete Actual Projected
n Precedin complete Start Time Finish time completion complete EAC= ETC = Project Time
Activity d Cost Expenditur EV CV SV CPI SPI Cost
(Weeks g Activity as on 10th (End of (End of as on 10th as on 10th BAC/CPI STC/SPI Overrun
(In Lacs) e Overrun
) Week Week) Week) Week Week

BCW P=Actual
Derivedfrom BCW P- BCW P- BCW P/ACW BCW P/BC
BAC Based on CPM Network Given % Complete X BAC-EAC ST- ETC
network ACWP BCWS P WS
BAC

A 4 20 - 100% 22 0 4 100.0% 100.0% 20.00 -2.00 0.00 0.909 1 22 -2 4 0

B 5 10 A 100% 9 4 9 100.0% 100.0% 10.00 1.00 0.00 1.111 1 9 1 5 0
C 8 16 A 60% 12 4 12 75.0% 60.0% 9.60 -2.40 -2.40 0.800 0.8 20 -4 10.00 -2.00
D 5 25 B 40% 10 9 14 20.0% 40.0% 10.00 0.00 5.00 1.000 2 25 0 2.50 2.50
E 4 8 B,C 0% 0 12 16 0.0% 0.0% 0.00 0.00 0.00 8
F 3 12 B,C 0% 0 12 20 0.0% 0.0% 0.00 0.00 0.00 12
G 4 12 D 0% 0 14 20 0.0% 0.0% 0.00 0.00 0.00 12
H 4 6 E 0% 0 16 20 0.0% 0.0% 0.00 0.00 0.00 6
49.60 -3.40 2.60 3.82 4.80 114.00 -5.00 21.50 22 days
After re-
scheduling

SUSHANT SHARMA
 F

12 17 3

E H

12 12 4 16 16 4 20 20

A B D G

0 0 4 4 9 11 14 16
4 5 5 H

SUSHANT SHARMA
 Earned Value Management
What is needed for EVM?
• A firm baseline plan
• A project budget (BAC – Budget at
Completion)
• A project end date
• Tasks are identified & scheduled
• Each task has a budget or effort (resource
loaded / weighting) (Task refers to cost
account)
• Actual tracked
SUSHANT SHARMA
 EVA Integrates –Three
Dimensional
• It compares the PLANNED amount of work
with what has actually been COMPLETED, to
determine if COST , SCHEDULE, and WORK
ACCOMPLISHED are progressing as
planned.
• Work is “Earned”
or credited as
it is completed.

SUSHANT SHARMA
What is Earned Value
Management (EVM)?
• A method of integrating scope, schedule, and
resources (cost data) objectives for measuring
project performance.
• It compares the amount of work that was
planned with what was actually earned with
what was actually spent to determine if cost and
schedule performance are as planned.
SUSHANT SHARMA
 EVM Trend Analysis: Cumulative
At
Risk Complete
Time Now Variance (
Prog
Budget Min if MR is
Management Reserve over

ACWP
Resources

(Actual Schedule Slip

Cost)

Cost BCWS
400 Variance (Planned
Value)
BCWP Schedule
(Earned Variance
300
Value)

200

100

Time
J F M A M J J A
Approx. Time Variance

SUSHANT SHARMA
 Unfavorable Schedule Performance
Time Now
Prog
Budget

BCWS
Rs. Resources

(Planned
Value) Schedule Slip

400 Schedule
BCWP
Variance
(Earned
300 Value)

200

100

Time
J F M A M J J A

SUSHANT SHARMA
 Earned Value Management

To perform EVM, three values need

to be determined
• Planned Value (PV or BCWS)
• Actual Costs (AC or ACWP)
• Earned Value (EV or BCWP)

SUSHANT SHARMA
 Earned Value Management

Planned Value (PV)

What are the budgeted costs of the work
scheduled? Time phased based on baseline budget
•Only changes when baseline is changed
•Also referred as “BCWS” & “BAC”
How much do you expect to have done at completion ?
How much should you have done at point X ?

SUSHANT SHARMA
 Earned Value Management

Actual Costs (AC)

What are the actual costs of the work
performed?
•Based on the actual completion of work packages
•Actual costs for reported work
•Also referred as “ACWP”
The dollar amount actually spent to date.

Has no relationship to work accomplished

SUSHANT SHARMA
 Earned Value Management

Earned Value (EV)

What are the budgeted costs of the
work performed? Based on the actual
completion of work packages
•Baseline value of the reported work
•Also referred as “BCWP”
How much have you actually gotten done as of
Today ?
Work accomplished, not money spent.

SUSHANT SHARMA
 Earned Value Management

Calculating Earned Value and

interpreting results
• to measure the progress of the project
• help identify trends
• forecast costs
• and identify ways to correct/mitigate
project pitfalls.

SUSHANT SHARMA
 Earned Value Management

Cost Variance (CV)

CV = EV - AC

• Good News: If CV value is positive, the project is currently

under budget (spending less than planned for the work)
• Bad News: If CV value is negative, the project is currently over
budget (spending more than planned for the work)

SUSHANT SHARMA
 Earned Value Management

Cost Performance Index

(CPI)
CPI = EV / AC
• Good News: If CPI value is >1 or =1, the project cost trend is
currently under or at planned budget
• Bad News: If CPI value <1, the project cost trend is currently
over budget

SUSHANT SHARMA
 Earned Value Management

Cost Variance % (CV%)

CV% = CV / EV

• Good News: If CV% value is positive, the project is currently

under budget by the CV%
• Bad News: If CV% value is negative, the project is currently
over budget by the CV%

SUSHANT SHARMA
 Earned Value Management

Schedule Variance (SV)

SV = EV - PV

• Good News*: If SV value is positive, the

project is currently ahead of schedule
• Bad News: If SV value is negative, the
project is currently behind schedule

* - not all positive SVs are good

SUSHANT SHARMA
 Earned Value Management

Schedule Performance
Index (SPI)
SPI = EV / PV
• Good News: If SPI value is >1 or =1, the project schedule trend
is currently ahead or on planned schedule
• Bad News: If SPI value <1, the project schedule trend is
currently behind schedule

SUSHANT SHARMA
 Earned Value Management

Schedule Variance % (SV%)

SV% = SV / PV

• Good News: If SV value is positive, the

project is currently ahead of schedule
• Bad News: If SV value is negative, the
project is currently behind schedule

SUSHANT SHARMA
 Earned Value Management

Estimate at Completion
(EAC)
#1
Actual costs to date plus a new estimate for all remaining work
(original plan no longer valid)

EAC = AC + ETC
(ETC Estimate to Complete)

SUSHANT SHARMA
 Earned Value Management

Estimate at Completion
(EAC)
#2
Actual costs to date plus remaining budget
(current variances are viewed as atypical
of future variances)

EAC = AC + BAC - EV
SUSHANT SHARMA
 Earned Value Management

Estimate at Completion
(EAC)
#3 & #4
Actual costs to date plus remaining budget modified by a
performance factor (CPI) (current variances are viewed as typical of
future variances).

EAC = AC + [(BAC - EV) / CPI]

EAC = BAC / CPI

SUSHANT SHARMA
 Value of Earned Value

• Schedule Status Reporting

• Cost Status Reporting
• Forecast Costs
• EV Integrates Cost, Scope &
Schedule objectives when
appropriately implemented

SUSHANT SHARMA
Faculty : Mr. Sushant Sharma

Mobile :9910039373
sushant_sharma1@yahoo.com

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