Project ManagementSlide 2Slide 3Slide 4Slide 5Slide 6Slide 7Slide 8Slide 9Expediting/Crashing CPM – Critical Path MethodCPM – Critical Path MethodSlide 12Project ManagementPlanning TechniquesProject manager responsible for developing project implementation plan. Duties includes:•Defining tasks•Making estimates (cost and timing)•Preparing schedules•Preparing budgetsProject ManagementRecall the house construction example:Task Definition:Description Duration(days) PrecedenceStep A: Prepare site. 5 -Step B: Build foundation. 8 AStep C: Frame walls and roof. 15 BStep D: Rough in Plumbing 12 CStep E: Rough in Electrical 10 CStep F: HVAC Venting 8 CStep G: Drywall 11 D,E,FStep H: Finish Electrical 5 GStep I: Finish Plumbing 4 GStep J: Finish HVAC 2 HStep K: Install Kitchen 8 H,IStep L: Install Baths 14 H,IStep M: Paint 5 J,K,LStep N: Landscape 5 J,K,LProject ManagementPrecedence DiagramTasks must sometimes be performed in series, or may at times be performed in parallel.For the house example, let each arc represent a project task/job.Each arc is identified by a job letter and duration. Note thedummy jobs indicating precedence that jobs H and I must complete before K or L begins. 2A,51 3 4 5 6 9 107811B,8 C,15D,12F,8E,10G,11H,5I,4J,2K,8L,14M,5N,500Project ManagementTiming – Gantt ChartTasks and task durations are often represented as Gantt Charts.With task precedence knowledge.Project ManagementCritical Path2A,51 3 4 5 6 9 107811B,8 C,15D,12F,8E,10G,11H,5I,4J,2K,8L,14M,5N,500Project ManagementExercise – Task DefinitionDefine tasks, duration and precedence for the Term Project.Description Duration(days) PrecedenceA. Form teams and select leader 1 -B. C. D. E. F. G. H. I. J. K.Project ManagementExercise – Precedence DiagramCreate precedence diagram for the Term Project, and identify critical path.2A,11Project ManagementExercise – Schedule/Gantt ChartCreate a schedule in the form of a Gantt chart for the Term Project.Project ManagementExercise – Cost Estimation / Resource AllocationEstimate cost and define/allocate resource requirements for the Term Project. Note, your costs will be in time not $’s.Description Cost ResourcesA. Form teams and select leader .25 hours AllB. C. D. E. F. G. H. I. J. K.Expediting/CrashingCPM – Critical Path MethodCan normal task times be reduced?Is there an increase in direct costs?• Additional manpower• Additional machines• Overtime, etc…Can there be a reduction in indirect costs?• Less overhead costs• Less daily rental charges• Bonus for early completion• Avoid penalties for running late• Avoid cost of late startupCPM addresses these cost trade-offs.CPM – Critical Path MethodExample:Job PredecessorsNormal Time (days)Crash Time (days)Cost of Crashing per Day ($)A - 10 7 4B - 5 4 2C B 3 2 2D A,C 4 3 3E A,C 5 3 3F D 6 3 5G E 5 2 1H F,G 5 4 4Overhead cost = $5/dayCPM – Critical Path MethodEnumerative Approach:Reduce job H by 1 day: Total Cost improves by $5 - $4 = $1.Reduce job A by 2 days: Total cost improves by $10 - $8 = $2.Reduce job A by an additional day, and job B by a day? Total costimproves by $5 - $4 - $2 = -$1. Therefore do not take this action.Reduce job A by an additional day, and job C by a day? Total costimproves by $5 - $4 - $2 = -$1. Therefore do not take this action.Evaluate combinations of reducing path 3-4-6 and 3-5-6 by one day.D & E = $5 - $3 - $3 = -$1 F & E = $5 - $5 - $3 = -$3D & G = $5 - $3 - $1 = $1 F & G = $5 - $5 - $1 = -$1Therefore, reduce job D & G by 1 day: TC improves by $5 - $3 -$1 = $1.Overall improvement: $1 + $2 + $1 =
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