292 PART 1 MANAGING PROCESSES

ealcuiat[ng Mea*s and Variarces

(Select Site and
Suppose that the project team has arrived at the following time estimates for activity B
Survey) of the St. John's Hospital pro.iect:

a:7weeks,m: Bweeks, and b:1Sweeks

a. Calculate the expected time and variance for activity B.

b. calculate the expected time and variance for the other activities in the project.

$&["t]Tlsil}

a. The expected time for activity B is

+ 4(B) + 15 : gweeks
t -7
,e -54
6 - -- -
6
activity, These
Note that the expected time (9 weeks) does not equal the most likely time (8 weeks) for this
when the most likely time is equidistant from the optimistic and pessimistic
times will be the same only
times. We calculate the variance for activity B as

^ z\2 /sY
/rs -
"':I i -(a/:1/8
u
project
b. The following table shows expected activity times and variances for the activities listed in the
descriPtion.

Y$$* ffi ffi ,Tfl iltATH$ fhs${S} &#TIVBTY $TAT}SYf,flS

Most Likely Variance

Activity Optimistic (a) (o'l
A 11 12 13 12 c 11

l5 o 1.78
B 7 B

C 5 10 15 10 2.78

D B I 16 10 1,78

OE 30 24 7.11
E 14

F 6 o 1B 10 40c

G 25 36 41 35 7.11

H
atr 40 45 40 278

10 t3 28 15 900

J 1 2 15 4 5.44

K 5 6 7 6 0,11

x)frcl$l$ru P$l$qT
The project team shoulcl notice that the greatest uncertainty lies in the time estimate for activity l,
followed by the estimates for activities E and G. These activities should be anaiyzed for the source of the
uncertainties, and actions should be taken to reduce the variance in the time estimates.

P*.;Nm,By au'*:tg ffs crm fr$ m fla fr $ fr fi fl u.#t*

Because time estimates for activities involve uncertainty, project managers are interested in
rleterinining the probability of meeting project completion deadlines. To der,elop the probability
distributiori for project compietion time, we assume that the duration time of one activitl' docs
not depend. on t-trat-of urry oih". activity. This assumption enables us to estimate the mean and
varianie of the probabilitv distributi.on of the time duration of the entire proiect by summing the
duration times ind variances of the activities along the critical path. However, if one work crew is
assigned trn,o activities that can be done at the same time, the activity times wili be interdependent
andlhe assumption is not vaiid. In addition, if other paths in the network have small amounts
of slack, one oi them might becorne the critical path before the proiect is completed; we should
caiculate a probabitity distribution for those paths as well.
 PROJECT MANAGEMENT CHAPTER 7 293

Because of the assumption that the activity duration times are independent random variables,
we can make use of the central limit theorem, which states that the sum of a group of indepen-
dent, i{enticaily distributed random variabies approaches a normal distribution as the number
of ranrlom variables increases. The meal of the normal distribution ls the surn of the expected
activity times on the path. In the case of the critical path, it is the eariiest expected finish time
for the projecl:

4 : ) (fxlected activity times on the critical path) : Mean of normal distribution

Similarly, because of the assumption of activity time independence, we use the sum of the
variances of the activities along the path as the variance of the time distribution for that path.
That is, for the critical path,
dr: )(Yariances of activities on the critical path)
To analyze probabilities of completing a project by a certain date using the normal distribu-
tion, we focus on the critical path and use the z-transformation formula:
T- Tz
UP

where
7: due date for the project
Given the value of z we use the Normal Distribution appendix to find the probabiiity that
the project will be completed by time f or sooner. An implicit assumption in this approach is
that no other path will 6ecome critical during the time span of the proiect. Example 7.5, part [a),
demonstrates this calculation for the St. John's Hospital proiect.
The procedure for assessing the probability of compieting any activity in a proiect by a spe-
cific date is similar to the one just discussed. However, instead of the critical path, we would use
the longest time patir of activities from the start node to the activity node in question.

f.* r*n r.. ffi r il'{fr t* ;:tl i:' t:t'!;#'*w

A project's duration is a function of its critical path. However, paths that are close to the same
duration as the critical path may ultimately become the critical path over the life of the proiect.
In practice, at the start oi the project, managers typically do not know the activity times with
certainty and may netrer know which path was the critical path until the actual activity times are
knor,vn at the end of the proiect. Nonetheless, this uncertainty does not reduce the usefuiness of
identifying the probability of one path or another causing a project to exceed its target comple-
tion time; it heips to identify the activities that need close management attention. To assess the
chances of near-critical paths detaying the project completion, we can focus on the longest pattrs
in the project network, keeping in mind that both dulation and variance along the path must be
considered. Shorter paths witir high variances could have just as much a chance to delay the
project as longer paths with smaller variances. We can then estimate the probabiiity that a given
path will exceed the project target completion time. We demonstrate that approach using statisti-
cal analysis in Example 7.5, part (bi.
Alternatively, simulation can be used to estimate tire probabilities. The advantage of simula-
tion is that vou are not restricted to the use of the beta distribution for activity times. Also, activity
or path dependencies, such as decision points that couid invoive different groups of activities to
be undertaken, can be incorporated in a simulation model much more easily than with the sta-
tistical anaiysis approach. Fortunately, regardless of the approach used, it is rarely necessary to
evaLuate every path in the network. In iarge networks, many paths will have both short durations
and low variances, making them unlikely to affect the project duration.

f,m$mtnlatfrng the Probahility of Contpletimg m Fr*iect hy m Given $m{m

Calculate the probability that St. John's Hospital will become operational in 72 weeks, using (a) the critical Online Resource
path and (b) near-critical path A-C-G-J-K. Active l'"4odel 7.3 provici*s
additioft;ll insight on
$r!"0hahility ana[ys;$ i0r tne
s$tuTiiilN
$t.,ioh n's l"'io$pitfl I prfris(lt.
a. The critical path B-D-H-J-K has a length of 69 weeks. From the table in Example 7.4, we obtain
the variance of path B-D-.H-J-K: ,$:
l.lA + 1]8 + 2]8 + 5.44 + 0.11 11.89. Next, we :
calculate the z-value:

72-69 3 ,-
tt I /
-
Vr r.as 3.45
294 PART 1 MANAGING PROCESSES

the value 0'B

Using the Normal Distribution appendix, we go down the left-hand column until we arrive at
and then across until we arrive at the 0.07 column, which shows a tabularvalue of O'B0TB Consequently,
greater than
we find that the probability is about 0.81 that the length of path B-D-H-J-K will be no
path is the critical path, there is a 19 percent probability that the prcject will take
72 weeks. Because this
longer than 72 weeks. This probability is shown graphically in Figure 7'7'
Y F8G{.}[48 7"7
on path
Probabili! of Complet!ng b. From the table in Example 7.1, we determine that the sum of the expected activity times
:
the St. John's Hospital
A{-G-J-Kis6Tweeksandthatdp: O'11 + 2'78 + 7'11 + 5'44 + o'11 1555'Thez-valueis
Picject on Scheduie
72-67 5
)'
Length of
critical path
Normal distribution
Mean = 69 weeks;
'- f,urr: ,*- '
/p = 3.45 weeks The probability is about 0.90 that the length of path A-C-G-J-K will be no greater
Ihan 72 weeks.
Probability of Probability of
meeting the exceeding 72 sEfi[$lsN f]*!f{T"
weeks is 0.1922
schedule is
The project team should be aware of the 1O percent chance that path A-C-G-.j-K wiil
0.8078
exceed the target completion date of week 72. Although the probability is not high for
that path, activities A, C, and G bear watching during the first 57 weeks of the proiect
-Ihls
69 7? to make SUre no more than 2 weeks of slippage occurs in their schedules. atten-
Project duration (weeks) tion is especially important for activity G, which has a high time variance.

Scrunl
An agile project management
framework that focuses on
allowing teams to respond rapidly,
efficiently, and effectively to
chance.
[1; . ']r .{ir: . ' ffh '*t-q$rl3 ffit; ;'"xilt"','}}#t;1E l' :'rr'
Uncertainty in activity times or costs can certainly create angst on the part of proiect managers,
horr.ever uircertailtl, in the project requirenents is at another 1evel. Such uncertainty arises in
product deveiopment projeits, such is software products, which have a number of function-
alities that ,rrrrt bn create-d. The project team must be agile in order to deal with unexpecteil
changes in their assignecl activitles. Scrum is an agile project mana€ement framework that
fo".,sleu on allowing te-ams to respond rapidly, efficiently, and effectively to change' Traditional
project.rrurage-"rrl methods, *hi"h ou" have presented in thischapter, fix prolect lequire:nents
i.cope) in aJeffort to manage time and cost. the Cleveland Clinic project in Managerial Prac-
il"" z.f is an example of a pioject suitable for the traditional approach. It is large and complex,
involves -u.ry *oik teams, hai requirements that are clearlv defined at the start, emphasizes the
seqrientia).ity of phur"r, and has a project manager who has overall responsibility. Scrum, how-
ever, fixes time and cost in an effort to manage requirements, which are the product's features.
The development of a software package is an exampie of a project well-suited for Scrrirn. It is
smali or *"dir* scale, involveiu r*uil team with muitiple skiils such as developer, designer,
and clatabase aclministrator, has a set of functional product requirements that are subject to
change throughout the project, has steps knortn in advance that do not have to be done in a
sequJntiai *Jnrr"., andillows the team to make decisions as to how to builri the product.
There are three roles in Scrum known as tire Scrum Team: The ScrumMaster, who iacilitates
team communication, removes obstacles to progress, and negotiates with those externai to the team;
the Produr;t Ortner, who has authoritv to make decisions about the product and prioritize its fea-
tures; a1c| the Development Team, which consists of a small multifunctional group of people rt'ho
are responsible for the delivery of the product. The Developmerrt'feam-estimates the time to accom-
plish t-he tasks, assigns owneiship oflasks, and has daily meetings called the Daily Scrum, which
iakes its name from rugby where teams form a circle and try to get the ball back into pia;r' The
Development Team is seli-organizing and chooses how it wili build the features of the pr-oduct.
TG project begins by formalizing a set of product features or product changes and putting
them in a Product Backlog in orcler of importance. The Development Team, in conjunction wlth
tlre Product Owner and ScrumMaster, selects a time box, called a sprint, tstally one to lour
weeks, and then selects product features from the Product Backlog it thinks it can complete r'r'ithin
the sprint. Daily scrums iron out problems and convey project status. At the end of the splint
the Team demoi the work it has completed to the Product Owner, selects new features from the
product Backlog along with those left unfinished from the iast sprint, and begins the next sprint.
bver the life oflhe pioject, features can be added or removed from the Product Backlog, which
emphasizes the need to have an agile approach to project management.
Choosing the best approach for a project must be done with care because each approach
comcs .n,ith iis shortcomlngs. With the traditional approach, it is hard to adapt quickly to shiit-
ing environments and requirements because problems at the operating leve I must be sen-t.r.ip
stieam to managers for resolution, making it difficult to overcome budgetary and tirneilnc
issues before they cause real harm. Ciient involvement is restricted to the early stages and an-v
changes later on causes backtracking and u.aste. A sudden change to requirements can bring
the whole proiect to a hait. Scrum, on the other hand, also has its drawbacks. The organization
must be committed to an agile management style, which may strip authority from some people'
 PHOJECT MANAGEMENT CHAPTER ? 2#7

7 2 Active Model Exercise: 7.2: Cost Analysis

The ction An lyzing n ost-'Tim e Trad e-offs" an d Exa mp e
7.4 Analyze cost-time trade- a
ho c0 nsid red to
em o nstrate h OW th e re eva nt costs m ust POM for Windows: Crashing
offs in a Proiect network.
m nt mize c osts. Fi gu re 7 .5 exp lains a keY a ssumption in th
an aiysis. S olve d Pro ble m 1 c onta deta ed S olutio n.
which exPlains Active Model Exercise: 7.3: FrobabilibT
7.5 Assess the risk of missing See the section "Assessing and Analyzing; Bisks,"
proiect managers and h ow to compute the Analysis
a proiect deadline. the risks faced by
probabilities. Be sure to understand Exam ples 7.4 and 7.5 and OME Solver: Three Time Estimates
Solved Problem 2. P0M lor Windows: Triple llme Estimates;
l\4ean/Standard Deviation Given
Simquick Simulation Ex-ercise:
Software DeveloPrnent UomPariy
Su [: Simulation

OME Solver: Proiect Budgeting

7.6 ldentify the oPtions See the section "Monitoring and Controlling Proiects'
available to monitor POM forWindows: Cost BudgetinE
and control Proiects.

vir #E H
$"W.? $:aqtAp.$*";3ga*$
1
w:.^*.!:,-.*,,,: w@*@ww"******\*!****-*.*"******w,

ffievmimpimffi t&xe ffirmiemt fficfuedulm

1.. Start and finish times:
/ : estimated time duration of the activity
ES : latest of the EF times of all activities immediateiy preceding activity
EF:ES+l
LF : earliest of the LS times of all activities immediately foliowing activity
LS:LF-l
2. Activity slack:
S:LS-ES or S:LF-EF

&namEgm* *q6 #ms{*Y$ llt'sm YrmSm-qpfffs

3. Project costs:

Crashcostperperiod: ffi
CC-NC
NT-CT
&ssessE*g amd &ma$gr&:rg ffiisks
4. Activity time statistics
le : mearl of an activity's beta distribution
a*4m*b
6

o2 : variance of the activity time

b- a 2

02: ( 6 )
5. z-transformation formula

{rp
where
7: due date for the project
7s : ) (expected activity times on the critical pathl
: mean of normal distribution of critical path time
op : standard deviation of critical path time distribution
 I

3OO PART 1 MANAGING PROCESSES

t
r, "".
"%fa:
uFE^"!
i -"" .- -T T-ft*
a(t^{11 --1. "
(pw"f&tr\..",,'tt} "-**.- ,,
&
, ': '(;{J- }. B s...H l$.,"".^ . ..4 fl$"
/,d

An aclvertising project manager developed the network diagram shown in Figure 7.10- for a new
advertising In addition, the manager gathered the time information for each activitv,
as shown in"u*puig..
the accompanying table.

TIME E$YOMATHS {WKS}

Activity 0ptimistic Pessimistic

A 1 4 7

B 2 6 7

o 6 B
C 3

D 6 13 14 A

E 3 6 12 A,C

F 6 B 16 B

\r 1 5 6 E,F

a. Calculate the expected time and variance for each activity

b, Calculate the activity slacks and determine the critical path, using the
expected activity times.
c. What is the probability of completing the proiect within 23 weeks?

Start
$0r[,Tl0N
a. The expected time and vatiance for each activity are calculated as
follows:
a-f 4m-lb
.e Fi*uffiH 7.1S 6
I'iotv'/or( Diagiaffi ior tno
Arlvril si,ng Pro;eci Activity Expected Time (wks)

A 40 100
D
D
trE 0.69
CE 0.25
C

D 12.0 1.78

E 6,5 2.25

F 9.0 2.78

G 4.5 0.69

h. We need to calculate the earliest start, latest start, earliest finish, and latest finish times
for each actirrity. Starting with activities A and B, we proceed lrom the beginning of the
network and move to the end, calculating the earliest start and finish tirnes:

Activity
A 0 0+4.0:4.0
D
0
n r Rtr - trtr

C
EE 5,5+3.5:9.0
D 4,0 4.0+12,0:16.0
E 9.0 9,0+6,5:15.5
F 66 5.5+9,0:14.5
G I5.5 15.5+4,5:2C.0
 \

PROJECT MANAGEMENT CHAPTER 7 3

Based on expected times, the earliest finish for the project is week 20, when activity G has been
compieted. Using that as a target date, we can work backward through the network, calculating
the latest start and finish times (shown graphically in Figure 7.11):

Activity Latest Start (rrrks)

G 15.5 20.0

F 6.5 15.5

E 90 15,3

D 8.0 200

C 5.5 9.0

B 00 5.5

A 4,0 8.0

4 FIS{-'RE 7.T1
Network Diagi'am with Ail
D
Time Estimates Needed to
Compute Slack

A E

4.4 b.5

L
Start
3.5

B G

6E 4.5

9.0

l,Ve now calculate the activity slacks and determine which actirrities are on the critical path:

{$TeffiT {l#KS} Fffi'fi$Ft #dK$)

Activity Earliest Latest Earliest Latest otou^ Critical Activity

A 00 40 4.0 BO 4.0 No

B 00 00 5,5 66 0.0 Yes

5.5
trE 90 9.0 0.0 Yes
C

D 4.0 8.0 16 0 20.0 4.0 t\0

a
I 90 9.0 15 5 t5.5 0.0 Yes

F 55 65 14.5 15 5 1.0 No

tJ t5.3 Itr tr
20,0 20.0 0.0 Yes
302 PART 1 MANAGING PROCESSES
are
expected times and variances'
The paths, and' their totai

(wks)
Total Variance {;i)
Total ExPected Time
1.00+1.78:2'78
4 + 12:16
A-U
1.oo + 2.25 + 0.69
: 394
A-E-G
4+6,5+4.5:15 3.88
+ 45: 0,69 + 0.25+2,25+0.69
+ 3,5 + 6,5 2A
B-C-E-G 5.5
0.69 + 2.78 + 0.59
: 4.16

B-F-G
5,5+9+4.5:19
path B-F-G is
a total expected time
of 20 weeks' However'
is B-C-E-G' with
The critical Path
varrance'
^;.weeks and has a large
19
the z-value:
W" first calculate
T- Te 23-ZA : l.3L
Ap
- v 3.88
ol
fu'i.' e-n-c ii
close to that
UsinetheNormalDjstributionapp-endix.we[indtlrattheprobabililvofcompletingthe
Lhe

proiecr in weeks r;;;;i- 0.e35i. Beca.rr.l;t'i;;*'''li;r path during the project'

23
"r i,"*i+, *:ii;;;;;'"thl critical
lriricat path and n"r. ,X[l',]i.i;";;.

f i,m ilqaffi mt'{eru*' {#:x"m s.$;fi fl}Kk$fr

3 RiskisameasureoftheprobabiiityandConsequence
that software is the u a"ti"*d proiect goal
Assume vou
1. One oi your colleagues cornments success' How would ;i;;;;i;g
management are the proiect manag€r
for a construction proiect'
ultimate key to prolect
you resPond? Identify the maior i"ift" project's success and
for each activity in a
"t*t
*uv' io circumvent them'
2. Explain how to delermine the slack ;;;;;li.
" ;iJi;i:w;v i; it i-;;''',.u.,ir"r
manasers ro know where
in their
itt.'rt""k is Proiects?

"{f r'.*,$nHmxxam ptovides a'check on vnur

hv handAt the least' the software com p lex and
for Windorvs 1o'ftware is available calcuiations. wt'"t' "u t"ui"t]on'L"'f*tit"larly
The OM Explorer and POM of this textbook Check
to all students using *" ;;i; "Jttt"n to d-ownload this soft- tho onal is interpreting *#;;;i;t;;;aking decisions' the scft-
go
il"'"ffii;;l; 'ifr"'"I the manuai calculations'
with vour instructor "b";;l;;;; I1 ryany cases' the
best to l-t'I'tnut"'
n,are and hor,n'
'"'oi'""'
how to do the calculations
instructor urants you ," ""a".iL"a

ffi mvm$*p$mffi tflxffi ffi r*$**€ Smfu *q$ua&m

a, Draw the netrn'ork diagram'

Considerthefoliowingdataforaprojecttoinstallanew fol this proiect'
1
School' b. CalcuLate the critical path
;"*;;;i ,r.," No'Li.'r'ni Pines High of the activities G' H' and
1?
c. How much siack is in each
about a'projecl
2. foilowing informalion is known
Activi$ Activit1r Time (days)
lmmediate Predecessor(s) "' The
;';;;;;;; , ioinr-of-'uie svstem at Kids
and rots

A 2 ApParel.
A
4
B
lime (daYs) lmmediate Predecessor(s)
ActivitY ActivitY
A
C 5
A 7
B
D 2 A
B
2
B
1 A
E
C
4
B,C
F 8 B,C
D
4
D D,E
G
J D
E
4
F
5
H I
F
F
4 E
G
5
7
G H,I
J
"/

PRorecrs chapter 5 trJ

Exppcrso ACTUAL
Expecreo AcTIVITy ExpEcrEo CotvrpLrloN Expecrpo % AcruN-% Cosr ro
\crrvlty cosr DuR"ATroN Srlnr Dlre DATE Covpr-ers CorrrpLrtr, Ders

;tart-up $ 100,000 1 0 days 0 10 10O"/o 1AA% $ 105,oo(

lonstruction 325,000 1 4 days o 22 12/14 = 85.7 14% 9A% 280,00(
:inrshinq 50,000 1 2 days ta 30 2112 = 16 6670/o aEo/ a tr,i(

Calculate the Schedule Variance. Schedule Perlormance lndex, and Cost Performance Index for
rhe project.

$s)trution

Step l: Calculate Budgeted Cost of the Work Scheduled tBCWSI ro dare:

Start-up is I 00 percent conlpletc and we are beyond the expected completion date. so budgeted
:ost is $ 100,000 for this acrivirV.

WouldexpectConstructiontobe85.Tl4percentcompleteandcost 5278.57 I todare.

Would expect Finishing to be 16.667 percent corrplete ar a cosr of $8,3-33 to date.

Budgeted Cost o(' Work Scheduled = S100.000 + $278.571 + 58.333 : $.186.904

Step 2: Calculate the Budgered Cosr of the Work Performed (BCWPI ro dare:
Start-up is I00 percent complere. so budgeted cost is $100.000.
Construction is actually only 90 percent complete, so budgeted cost fbr this much of the activity is
(-325.000 x 0.9) :
$292,500.

Finishing is now 25 percenr ctrmplere. so budgeted cost is ($50.000 x 0.25) = $12.500.

Budgeted Cost of Work Perfbrmed = $100,000 + $292,500 + $12,500: $405,000

Step 3: Actual Cost (AC) of the project ro date is $105,000 + $280,000 + $2,500 : $387,500.
Step 4: Calculate perlbrmance measures:

Schedule Variance = $405,000 - $386,904 = g18,096

Sche<lule Performance Index = $405,000/$386,904 = 1.05
Cost Perlormance Index = $405.000/$387.500 = 1.05

fhe project looks good since it is both ahead ofschedule and below the budgeted cost.

ffiffii SOLVE$ pfro*-r_trr\4 2

A,project has been defined to contain the

:or completion:
following tist of activities, along with their required times
r- drto,a' 'l
l-.l,ri*
l
L-J
I
Acrrvrry Trur (nevs) IM;tagotarg. PRsoECEssoRs

,A
Excel:
1

B 4 A Ch5_Solv*d
C a
A Problems
D 7 A
E 6 B
F 2 C,D
G l trtr
H I D
I

I 4 G,H
:

l
154 OpgRartorus nxo Suppl-v CHqrr.r MaNlaeeMeNr

b. Show the early start, early finish, late start, and late finish times.
c. Show the critical path.
d. What would happen if activity F was revised to take tbur days instead of two?

answers to a, b, and c are shown in the following diagram.

I
1

0l

Critical path:
A_B_E_G_I

PerH I-ENCTH (DAYS)

22 (critical path)
1.1.19'l
A-L-F-G-I 17
A-D-F-G-I 21
A-D-H-I 21

d. New critical path: A-D-F-G-I. Time of completion is 23 days.

S&wED FR*BI-ER/g 3
project has been defined to contain the following activities, along with their time estimates for

Turap Esrruarps (wEEKs)

ACTIvITY tn b IulaentarnPneoncEsson

,A 1 4 tl,t7.

B 2 6 A
C 3 4 t) D
D 6 12 14 A
E 3 6 12 D
6 I 16 B,C
(: I 1 5 6 trtr

a. Calculate the expected time and the variance fbr each activity.
h. Draw the critical path diagranr.
c. Show the early start, early flnish times, and late start, late finish times.
 PRolecrs chapter 5 155

e. What is the probability that the project can be completed in 34 weeks?

{1.
a*4nt*b /h-a
ACTIViTY
ExPgcrro Tttvlr _'- Acrrvnv VARIANCE
\ 6
A 4.00 1

tr trn 0.6944
,2
+ tt o.25oo
,1 .7778
D 1133
650 2:2500
: 9.00 2.7778
G 4.50 o.6944

b.

4 9.5 r9.50 28"5

B(5.s)
0 4 9.50 28.5
33

15.33 19"50

0
1l

4 15.33

' Critical path: A-D-C-F-G,

4 22 28.5
J-1 WeeKS

c. Shown on diagram.
d. Shown on diagram.

PATI.I LENGTH (wEEKs)

A.B-F-G 23
A.D.C-F-G 33 critical path
A-D.E-G 26.33

34-33 1
,-D-Tu --
'- -=0.3922
2'5495
1lz"r*- -=

up that value in Appendix E and we see,that there is about a 65 percent chance of completing
project by that date.
 H

1-f,
Pno.tecrs chapter 5

d. Show tne cntlcal Patn.

c. whar is the probability that the project can be completed in 3,i rveeks?

$otutioul

a*4m*b b-
ACTIVITY
EXPECTED TIME _'- ActtvlTv VAHANCE
6

A 4.00 1

B 550 0.6944
C 4.17 0.2500
D I I JJ 1.7178
F 6.50 225AO
F 9.OO 2.7178
G 4.50 o.6944

b.

+ 9.5 19.50 28-5

B(5.5)
0 4 28.5
33

15.33 19.50
0
-) -)

4 15.33 t

eritical path: A-D=C-f--G,

4 28.5
33 weeks

r:. Shown on diagram.

d. Shown on diagrarn.

PATH LENGTH (WEEKS)

A.B-F-G 23 ,,:,

A.D.C-F.G 33 critical path

A-D.E-G 26.33 :

D:Jz 34-33 1
7_
y't +
- 2.5495
- =0.3922
,,r>oi, t .7778 + 0.25 + 2.77'78 + O.6e44

up that value in Appendix E and we see that there is about a 65 percent chance of completing
project by that date.
 f

158 OprnattoNs lNo SuppLv Crlatn MnNaorverur

structures:
A. Pure project
B. Functional
C. Matrix Project

4.Whatisthetermforagroupofprojectactivitiesthalareassignedtoasingle
organizational unit?

5.
to

30
have

to bring in
the prol'ect.
and Cost
1S the going?
cost is the

6.

and
to be onlY
ves

To

CPM:

IMMEDIATE PREDECESSOR TrME (wEEKs)

AcrlvtrY
.A 6
3
B
C. 7
2
D
D 4
E
D 3
F
 \

Pnorrcrs chapter 5 '159

a. l)taw the networK.

b. What is the criilcal parh?
c. How many weeks will it take to complete ttre piojictt
d How much slack Ooes activiiy B have?
8. Schedule the following activities using CPM:

ACTIVITY IMMEDIATE:PREDE{ESSoR TrME (wEEKs)

A 1

B A 4
c A ?

D D
E C,D 5
F D 2
G F 2
H E,G 3

a. Draw the network.

b. What is the critical path?
c. How many weeks will it take to complete the project?
r1. Which actir ities have slack. end how much?
9. The R&D dcpartmcnt is planning to bid on a large project Ibr the development
of a new con-imunication system for commercial planes. The accompanying table
shows the activilies. timcs, and sequences required,

Acrrvrrv Il,tturol,ctr Pnroecesson Trrvm (wEE<s)

A
D
/\ :I
C A 4
D A 4
E B 6
F C,D ,6
G D,F ,2
H D 3
I E,G,H 3

:: r:, : a;':::Suppose you wanlto shorte thocompletiontime, as muth aS:'p$ssible,:and:,' ,

you traui the option of shoitening any or all oi g. C. D. and C each one week.

d,, What:is the new,qritical patn,,and- eq1t19st compleL!@ tirnC?

10. The following repr€sents a projeet,tharshouldtre sehedutred,using CPM:

,TlrMEs (DAYS)

Acrwmy ,: :, :IMMEDIATE:PREDECESSoRS Q nt b
"

A 1 3 5
B 1 2 3
C A 1 2 3
D A 2 a 4
E B 3 4 11
F C,D 3 4 5
G D,E 1 4 6
H F,G 2 4 5
160 OprRartoNs lNo Supprv CHatit Mnlacrurrur

a.
h. What is the critical Path?
c. What is the expected project compietion time?
J Wtu, is ttre probabiliiy ot'completing this project within 16 dllt?--
in X weeks or
ff . if-,"." i, an 82 iercent chance the proiect below can be completed
less. What is X?
Mosr Mosr Mosr
AcrrvlrY Orruursuc LIKELY Prssrulsrtc

2, 5 11
A
3 -) 3
B
J 5
C 1

n 6 8 10
,* 4 10
E

12. The ibllowing table represents a plan for a project:

Turrcs (uvs)

JonNo., PneoecsssoRJoB(s) d ,l',t b

2 3 4
1

2 ; 1 2 3
) 1 4 5 12
4 1 3 4 11

2 J 5
5 I

3 2 3
6 1

1 4 1 B 9
5,6 2 4 6
8
9 8 2 4 12
10 l a 4 5
9, 10 5 7 8
11

a. Construct the appropriate network diagram'

1,. tndicate the critical palh.
c.Whatistheexpectedcompletiontimefortheproject?--.
r/'Youcanacconrplishanyoneofthefollowingatanad<litionalcostoi$i,500:
' (1):ReduaqjopS!YtwodaYs' . '
': {2),Reduce job3 by 1wo days,: ,,

' , ,'" ' (3)i Reduce job7'$l,OOO,fui

bY lwo daYs. '
,' ' if *ff eaitr Cay $at the earliest completion time .ts

any,'would:you choose?
r' e. reduced;:which"action,,if
What is the probabilitv that the projecr will take more than 30
days to
following activities;
ti. a cotritruction pro3ect is broken downinto the 10

Acrrvtrv INrNaEotnte PREoecessoa Tntr (wuers)

4
1

2
2 1

4
3 1

3
4 1

2, 3 5
5
o 6
1 4 2
5 3
B
6, 7 5
9
o 9 1
10
 126 PART I IiI-iICDUCTioN Io oPERATIoNS N/ANAGEIVIENT

Problenrs rr*e $6'means the problem may be solved with POM for Windows and/or Excel Olr,4.

Probtems 3.t3.2 retate to Projeci Flanni6,.,,;,r,L=..;

" 3.: The work breakdown structure (WBS) for building a A Buy the land None 40
house (levels i and 2) is shown below: Get the constru ction iA 30
ission

re C Excavate B 10
Erect bulld!ne c 100
Electrical work D 10

Sil€ Plumbing work D 20

lia6onry Carpentry Plumbing Finlshing
G Paint interior D
I
I Clean up building E,F,G
l\4ove in furniture H 5
a,) Add two level-3 activities to each of'the tevel-2 activities to
provide more detail to the WBS.
b) Select one of yonr level-3 activities and add two level-4 activi-
ties below it.
- , 3.4 Using the project inforrnation listed in the table below:
, , 3"tr You are the project manager for a project in which a) Draw the AON network lor the construction activitv.
ycu are going to organize a conference. Develop a work break- b) Draw the AOA lor the construction activity.
riown structrire (WBS) in the folm of a hierarchical framework,
sinril;rr tc the one in Figure 3.3, based on tl-re partial list shown in
the table with ail n'rajor deliverables, component deliverables. and
0ol-Irponent parts.
A 4:
B ,',
IU Conference
C 2
Sessions
',
''
.r'i Pgqgrs D A2
' t't1 at1
Topic A
E B 3
i .41 .a2 roplc B
:'.t2 Panels F B 4
.c2.01 Panel A
G C 2
12 Location & Dates I
)-..-.

12.41 Site X i D,E 5

1
",,,.
i Z)Jl Slle Y I
I F,G 3
12.C3 Date A
12.44. Date
1?
B
, 3.5 The table below shows the activities, immediate.pre-
Faci I iti es
decessors, and activity durations of a project. Drau, the AON
B uild ings
project network. How long would it take to complete this proj-
13.01.C1 Buildi ng fd\t
ect? What is the length of the critical path?
13.01.02 , Bu!ldlng West
nt

13.03.01 kfast A 2
13.03.0, Coffee
A 4

lc A 4
Problern 3.3 rel io Proieit ffiuli l..1;,...' r,11;,.
D D
6

'' " 3.s Potamia Construction Co. (PCC) is developing plans D9

Lo flrecr a new hospital building. Potamia Construction Co. has L8
esta'o1i-ched the project activities and their immediate predecessor
G E,F 2
act;r,,ities together with their estimated activity durations accord-
urg lo rhr' intbrmation described in the lollowing table. prepare H G 2
r Gantt chalr (horizontai bar chart) {br the whole construction :

rci:ri(r based on this information.

H, I
i

K 4
 I

C}IAPTE* 3 PI?OJECT MANAGEMENT I27

problem'
a) Develop an AON network for this
. 3.6 A project has the following actirities' precedence
the ^AOA project net- b) \Yhat is the critical Path?
."tutio.,rt ipr, an&activity durations' Draw What is Wnu, is the total project completion time?
*-i. ff"ri long would it t k" to complete this project? "i B(
i, wh;;i; the slackiime for "ach individual activirv?
the length of the critical Path? assembly
3.9 Task time estimates for the modificationareofasanfollows:
Illinois' factory
DURATTON
(wEEKS) fr";;r- Goodale's Carbondale'

None 18
A

B A 8 A 60
I 1 .2
a B 6
1.,,.,-..,..--
A 9 6.0
D D
t.-* *". *."---*-.-
4.5 B,C
C,D 5 E
E
1.7 D
F
E 4
F
4.0 E,F
G
D 10
a) Draw the project network using AON
G

H E
l' ..,,,,.1 b) IdentifY the critical Path'
wir^irl the expected project comPletion time?
)
I
G,H "i
i) il;; Gantt chart lor the Project'
s%f.

tabie are
' 3'1o The activities described by the follou"ing
3.7 l)ralv the AON project network using the following
given lor the Howard Corporation in
Kansas:
information:

o
A.
4 :
1
A a A
l:.. ''"1
lSt-: 35: a
L A
6
5 D
C
B 9
E
9
D
C 4
F
3
E EF 6
G

F C,E D

G,H 3
D 7 t
1or.I.C. Howard's
H F 3
I a) Draw t1.re appropriate AON PERT diagram
'1
5
management team'
G,H
I
b) Find the critical Path'
ffi'&f
G 1 Wflu, is the project completion time?
J
"t the followillg
, ,3,1t Draw the AON project network using
project? Which activities
How long would it take to complete this information:
are included on the critical Path?
chain
. ' 3.8 Rogel Ginde is developing a program in supply
Ginde has. listed a num-
mana-gen-rent ce]'tif:ication tbr managers' 4
belbre a training program A
fr"t.iu.tirlti.s that must be completed
immediate pre- 3
ol this nature could be conducted' The activities' B A
table:
decessors, and times appear in the accompanying C : A 6

B 2

r B 3
2
A 5
E
:F C, D
B
,1
iG E,F
C
durations
B 10 a) Draw an AON diagram olthe project' including activity
D iir chroto-
A,D 3i ti p.nr" ii,. criticalpath, listing ali criticai activities
E
logical order.
F C 6, c) W]rat is the project duration
(in weeks)?
associated with any and all non-
G E,F B
O il;; ; the sla;k (in weeks)
critical paths through the project?
l tS pAmr r nlTRCDUCitoN To optRATtoNS rvtANAGEtvrENT

. 3,i2 The actlvittes needed to build a prototype laser scan-

r.ring machineat Dave Fletcher Corp. are listed in the lbllowing
iai;le. Ccnstmct an AON network lor these activities. A 6 E 4

B: 1 F 6

ACNVITY C 3 Lr 10

A E D 2 H l
F B

C A G C,E
t --..
1. Additionul problent 3.16 is available in f""fiVL,,,"tl:t #g:ermt!oi"rs
D A D,F
H
b.,4efia&*r'ney1t. It involves 21 activities in building the Rover'
5 auto.

,. , g"{3 The loilowing represent activities in Marc Massoud's

a{)nslr uetion Company ploject. p-ir"-" s.17-s.27 rerare to Variability in Actiuity limes

''':'''':r;PffiWtl" t"g1,ffiffi:'
--, "".3.1v Ross Hopkins, president ol Hopkins Hospitality, has
developed the tasks, drirations" and predecessor relationships in
4 the lollowing table lbr building nerv motels. Draw the AON net-
work and answer the questions that tbllow.
C ,A 1

E
D B

E B 2

F C,E
A
G D 2
BA LOl4
H F,G 3
C A I 12 16

D 'A 4 6 10
a) Dr.LB' the network to represent tl-ris situation
b) lVhicir aciivities are on the critical path? E i1 3
c) lViat rs the length of the critical path? &#
E,C
F 6 8 20

G E,C 2 3 4

H F 2 2 2
.Atldirional problem 3.14 is uvaihble ilt f'"fii11..a1* *,p*ratemts
i'ii:tl,t,inltit:tt\\lr!|" It involves finding tl-re activities lor a college I F 6 6 6
dcgree.

, ',t'' r
4 6 ', 12

:K tt 2 2 :3
probrems s.1s-3.16 rerate to 0etermining the Project Schedule
a) What is the expected (estirnated) time lbr activity C?
b) What is the variance fbr activity C?
c) Based on the calculation of estimated times, what is the critical
" S.ts Dave Fletcher (see Problem 3.l2) was able to deter- path?
rnine Lhe activity times Ibr constructing iris laser scanning machine. d) What is the estimated time ol the critical path?
Fl"^tcirer v,,culd like to detelmine ES, EF, LS, LF, and siack lor e) What is the activity variance along the critical path?
*ach activitl,. T'he total project completion time and the critical f) What is the probability of completion of the project belore
path siror"rld also bc determined. Here are the activity times: week36?W
 L-

T29
CHAPT:R 3 PROJECT MANAGEMENT

1_:ti
.s.tSArenovationofthegiftshop^a.t0rlalrdoAmrvay
the following estinales.of
Center has six activities (* A.utt)]por
a. nx. arrdb, calcutrate tUe expecteO
tiae and the standard devia-
tion for each activitY: h(

11 IJ 19 <
A
a1 41
B 27

18 18 18
C
e
q
8 13 19
D

1l to 20 variance lor each actlvil\ '

a) Calctrlate the expected time and
E

16 19 22
li ;t,;,'til" t*ptttta to*frttion time"of tlre"critical ratlil
time of the other path in the
F

What is the expected to"'pfttion

.- 3.{9 Kelle Carpet and Trim installs
carpet in commercial network? - ,^r,,, .l
path? What is the valance
bt;;tty concerned-with the amount of c\ What is the variance of the critical
offices. Peter Kel1e has
r"c"nt jobs' Some.of l-tis workers of the other Path iu the network?
trn-re it took to complete
'e"rul and their optimistic comple- the time to to*pfttt puif'
A-C is nornrallv dtstribrLteci' l.hat
are very unreliable. e list ol activities "' If
d) fnrished in 12 ii'eeks cr
likelf completion time' and tl-re pessimistic i;;il; prouuuili'v it'ut ti'i* path will be
tror.r time, the most given in the
i"*pi.ii". ri*e (all in d'ays) t'or a new contract are less?
path B-D isnonnally dlstributed' \:"h?it
e) If the time to complete
path will be finished in 12 i"'eeks
cr.
tbllowing tabie: iJs
is the probability that
less?
patlt iiiii be jli-'-
il i*pf"i" why the probability that the criticrtl I :'':
is'lred in 22 weeks "'
it not rlecessarill, the pro-hahiii L
the Ttoicttwill
't" in 22 weeks or less "
be tinished
A 3 6

Coleman Rich Control Devices'

Lt'
B 7
^"3.2t l:"..::','::
pl o-leci
altto m^akers' The most receni
C 1
3
custim-bui1t relay devices ior Rich's marL-
14 dillerent activities
6 1 8 C
undertaken by Rich "q"i"'
D
B,D like to determine the total project completion time
4 6 agers would
2 the clitical path' The
Iin davs) and those u"u'iiitt tf-r"t 1ie along
E

10 14 A,E
6
;;o;;;il;;,ia are shown in rhe following table'
2 4 A,E "*n" in 53 days?
G
is the probability of being done
1

.i ffi;41
;;;;abilitv of cornpletion?
F
H 3 6 9
b) What date results t" ;i;i'
12 G
10 11

20 C
14 16
8 10 H, I
K 2

time and variance for each 6 7

a) Determine the expected completion A
activitY. 2
time and the critical D

b) Deterrnine the total project completion 6

A 6
path lor the Project' C

.l "O"i..t-t. gS, Ef', r-S, LF, an<l slack for each activity' 5 8
will finish DA
;*' w;;i il. pioOarrilitv iflut r<ttte Carpet and Trim
tt.,. f rol..t in +O duYt or less?
B# E B,C 1 9

3
predecessors tbr D 2
.'" 3,2O The estirnated times and irnmediate
:
F

Kyparis's retittal scannitig l

the activities in a project at George
1
G D
tl.'t totto'"i'-'g table' Assume that the activ-
;;;;;;;;t. giuen in H E,F 4 4 o

ity times are indePendent' 6

G,H
7
) I
)
o 9 11
K
4 6
9 10 ) 7
L

B
:
4 , 10 tb
M K
I 2
?

A.
g 10 11
6
o N L, IVI
b r5 11
} S$ pART 1 INTRODUCTION TO OPERATICNS IVIANAGEIV]ENT
N
\
. ,'.'3.24
Four Scluares Productions, a firm hired to coordinate a) Find the expected completion time tbr this project.
thc rslease of the movie Pirares o.f the Caribbean: Deatl Men Tell b) What variance value would be ttsed to lind probabilities of lin-
No Ttt!cs (starring Johnny Depp), identified 16 activities to be ishing by a certain time? $k'
completed Lreiore the release of the film.
- . ,9.25 Janice Eliasson must complete the activities in tl-re
lollowing table to finish her consulting project.

A 2

B 3 3.5 4

C 10 12 13 A 7 2
;

D 4 1
B 3 A
2 4 5
)
C I A
r A 6 7 8
D 4 1 B,C
G B 2 4 5 5

H a 5 1.1 9 E 5 1 B,C

C 9.9 10 12 F 8 2 E
I

4 5
J 2
G 8 D,F ]

K D 2 4 6

L E 2 4 6
H 6;2 G

\4 F,G,H 5 6 6.5
a) Draw the appropriate PERT diagram.
N J,K,L b) Find tire critical patir and project completion time.
r') l, N,4 5 c) Find the probability that the project will take more than
? N i 49 tirne periods to complete. ffiff

a) Hr:,ri l'le.nl w'eeks in advance ol the film release should Four

SqrLares hai'e started its marketing campaign'l What is the Adtlitional problems 3,26-3.27 are avuilable in ?,tyl.itl]
crilical pathl The tasks (in time units olweeks) are as lollows: *ptretiens Flar:ag*nnei:t. These have 12 and 23 PERT
ir \\ i.r:rt is rhe probabiiity of completing the marketing campaign activities, respectively.
lr the liirc (rn $-eeks) noted in part a'?
ci liacti"ities I and J rvere not necessary, what impact wortld this
irave on the critical patli and the number of weeks needed to problems s.a8-s.33 retate to eost-llme Trade-0ffs and Proiecl Crashing
ccrirpiete the marketing campaigrfl W
,3"23 Using PERT, Adam Munson was able to determine
',' . .3.2a Given the project diagram that tollows. see graph (a)
rhat lhe expected project completion time lbr the construction of and the details ol the accompanying table. How can you reduce
a pleasure yacht is 21 months, and the project variance is 4. the completion time of the project by 4 weeks in the most eco-
ai 1Vl.rat is the probability that the project will be completed in nornical way?
17 rnonths?
Lr) Wirat is tlie probability that the project wiil be completed tn
20 months?
c) Wl'rat is the probability tirat the project will be completed in
A 3 7 1 4,000 5,000 1 000
2i nionths?
d) What is the probability that the project will be completed in B 5 5 0 10,000 1 0,000 ol
25 months? C ? 1 1 1,500 2,000 s00
e) What is the due date that yields a 950/o chance ofcompietion? thfl D 2 1 1 6,000 '10,000 4,000
, ,3.24 A small sollware development project at Krishna 3 2 1 8,000 15,000 7,000
Dhir's ijrm has five major activities. The times are estimated and 4 3 1 3,000 4, 00 0 000
I
prcvided in the fbllowing table.
G B 6 2 4,000 7,000 3,000

H 2 1
'1
3,000 5,000 2,000

A 2 8

B 9

C A 4 1 10

D B 2 5 14

C
) 3 3