Chapter 4: Schedule, cost, and situation analysis (pt. 1)

1. Chapter 4: Schedule, cost, and situation analysis (pt. 1) ISE 443 / ETM 543 Fall 2013

2. For ongoing project monitoring & control, a detailed schedule is needed • The Project Network • A flow chart that graphically depicts the sequence, interdependencies, and start and finish times of the project job plan of activities that is the critical path through the network • Provides the basis for scheduling labor and equipment • Provides an estimate of the project’s duration • Provides a basis for budgeting cash flow • Highlights activities that are “critical” and should not be delayed • Help managers get and stay on plan

3. To create the detailed schedule, start with the WBS • The lowest level of detail on the schedule will be the work package • Identify dependencies and time requirements • Start with known “end” events and ask, “what needs to be accomplished before this event or milestone can be achieved?” • Terminology • Activity: an element of the project that requires time. • Parallel (concurrent) activities: Activities that can occur independently and not necessarily at the same time. • Event: a point in time when an activity is started or completed. It does not consume time. • Path: a sequence of connected, dependent activities.

4. There are some basic rules to keep in mind when constructing the network • Networks typically flow from left to right. • An activity cannot begin until all of its preceding activities are complete. • Arrows indicate precedence and flow and can cross over each other. • Identify each activity with a unique number or letter; this number (letter) must be greater than its predecessors. • Looping is not allowed. • Conditional statements are not allowed. • Use common start and stop nodes.

5. Let’s review the fundamentals ... • A is preceded by nothing • B is preceded by A • C is preceded by B • Y and Z are preceded by X • Y and Z can begin at the same time or at different times A B C Y X Z

6. J • J, K, & L can begin at the same time, but don’t have to • All (J, K, & L) must be completed before M can begin • Y is preceded by W and X • Z is preceded by W and X K M L W Y Z X

7. In addition to precedence, time estimates are needed to determine the critical path • Three estimates are developed for each activity • An optimistic time, TO • A most likely time, TL • A pessimistic time, TP • Assuming a beta distribution, the expected time is calculated as • And the variance is

8. Your turn ... The following table shows the activities, precedence, and expected times for a county engineer’s office project to develop and fill a business center. In the space given on the following slide (or on your own paper), create the project network for this project.

9. Project Network Fill in these blocks now... Your nodes should look like this ... ES ID EF Description SL TE LF LS

10. Finding the Critical Path and the amount of Slack in non-critical paths is a two-stage process • Forward Pass – Earliest times • How soon can the activity start? (early start—ES) • How soon can the activity finish? (early finish—EF) • How soon can the project finish? (expected time—ET) • BackwardPass – Latesttimes • How late can the activity start? (late start—LS) • How late can the activity finish? (late finish—LF) • Which activities represent the critical path? • How long can it be delayed? (slack or float—SL)

11. Forward pass computation • Add activity times along each path in the network (ES + Duration = EF). • Carry the early finish (EF) to the next activity where it becomes its early start (ES) unless… • The next succeeding activity is a merge activity (has more than one preceding activity), in which case the largest EF of all preceding activities is selected.

12. Network forward pass Return to your (corrected) network and complete the forward pass...

13. Backward pass computation • Subtract activity times along each path in the network (LF - Duration = LS). • Carry the late start (LS) to the next activity where it becomes its late finish (LF) unless... • The next preceding activity is a burst activity (has more than one activity following it), in which case the smallest LS of all succeeding activities is selected.

14. Network backward pass • Return to your (corrected) network and complete the backward pass...

15. The PM uses the “slack” in the network to determine the critical path and decide when to start activities, how to allocate resources, etc. • Free slack • The amount of time an activity can be delayed without delaying connected successor activities • Total slack • The amount of time an activity can be delayed without delaying the entire project • The critical path is the network path(s) that has (have) the least slack in common.

16. Critical path and slack • Compute the free slack for each activity and the total slack along each path • Identify the critical path

17. A few final words about time (and cost) estimates ... • GIGO (garbage in – garbage out) • the success of the project depends on the reliability of your initial estimates • Avoid this by requiring multiple independent estimates • “Rule of 2 or 3” (2 for most estimates, 3 for critical or important tasks) • First estimate is given without consultation with others • Consensus is sought if estimates are very different • At a minimum, use this approach for critical or difficult estimates; conservatively, use it for all.