Project Management Managers have been planning, schedulin; ing, monitoring, and controlling large male projects for hundred years, but it has only been in the last 50 years that management science techniques have been applied to major projects. ‘They are two types: Critical Path Method(CPM) Project Evaluation and Review Technique(PERT)Introduction- CPM © Defination:- Critical path is a sequence of activity between a project’s start and finish that takes the longest time to complete. © Critical path method is based on mathematical calculations and it is used for scheduling project activities. © In 1950, Critical path method(CPM) was developed by Kelly and Walker to assist in building and maintains of chemical plants, © The initial critical path method was used for managing plant maintenance projects.© Critical path is the sequential activities from start to the end of a project. Although many projects have only one critical path, some projects may have more than one critical paths depending on the flow logic used in the project © The essential technique for using CPM is to construct a model of the project that includes the following: ° A list of all activities required to complete the peice! (typically categorized within a work reakdown structure © he time (duration) that each activity will take to completion, © The dependencies between the activitiesCritical path analysis (“CPA”) CPA is a project analysis and planning method that allows a project to completed in the shortest possible time J tutor2uThe need to plan complex projects « Many larger businesses get involved in projects that are complex and involve significant investment and risk * As the complexity and risk increases it becomes even more necessary to identify the relationships between the activities involved and to work out the most efficient way of completing the project tutor2uIntro: Making a cup of tea (no sugar) — how quick can we plan to do this - from standing in the kitchen to have a hot tea ready to drink? Lets list what we need to do, how long it takes and in what order: Sketch a critical path diagram to represent the project of making acup of teaTerminologies used in CP In order to explain the purpose, structure and operation of CPM, it is helpful define the following terms: Activity:An activity carries the arrow symbol.This represent a task o1 subproject that uses time or resources Aetivity Event:- A node (an event), denoted by a circle , marks the start an completion of an activity, which contain a number that helps to identify it location. For example activity A can be drawn as: A 1 2 Dummy Activity: An activity, which is used to maintain the pre-defin precedence relationship only during the construction of the project network, i called a dummy activity. Dummy activity is represented by a dotted arrow an does not consume any time and resource =o >© Parallel activity: There are two activity which being at same event and end at same event.this activities are called parallel activity. eS Ra Not allowed..... © Path: A path is a series of adjacent activities leading from one event to another. © Critical path: A critical path is the sequence of critical activities that forms a continuous path between the start of a project and its completion.Situations in network diagram B A must finish before either B or C a can start, it called burst event. c both A and B must finish before C can start, it called merge event. Dangling events is not allow. B Sal > A must finish before B can start ‘Dummy both A and C must finish before D \ can start, it's called dummy activity. —_ —Forward pass: © The Early Start and Early Finish Time Calculated by moving Forward Through the Network. © Consider Maximum.Backward pass: © The Latest Start and Latest Finish Time Calculated by moving Backward Through the Network. © Consider MinimumFloat activity: © Float activity For an Activity is The Difference between its Uarliest and Latest Start Time or Earliest and Latest Finish Time .Steps in Critical Path Method © Step 1: Make a forward pass through the network as follows: For each activity i beginning at the Start node, compute: arliest Stat ‘lime (ES) = the maximum of the earliest finish times of all activities immediately preceding activity i. (This is 0 for an activity with no predecessors.). This is the earliest time an activity can begin without violation of immediate predecessor requirements. Parliest Finish Time (2) = (Earliest Start Time) + (Time to complete activity i. This represent the earliest time at which an activity can end. The project completion time is the maximum of the Earliest Finish Times at the Finish node.Continue sscaseses © Step 2: Make a backwards pass through the network as follows: Move sequentially backwards from the Finish node to the Start node. At a given node, j, consider all activities ending at node j. For each of these activities, (i,j), compute: Latest Finish Time (LP) =the minimum of the latest start times beginning at node j. (For node N, this is the project completion time.). This is the latest time an activity can end without delaying the entire project. Latest Start Time (LS) = (Latest Finish Time) - (Time to complete activity (i,j)). This is the latest time an activity can begin without delaying the entire project.Continue © Step 3: Calculate the float time for each activity by: float = (Latest Start) - (Earliest Start), or = (Latest Finish)-(EarliesFinish). A critical path is a path of activities, from the Start node to the Finish node, with 0 float times.Drawing the network Component Description Node \ \ a) fs al Acircle that represents a point in time where an activity is started or finished. The node (circle) is split into three sections: The left half of the circle is the unique node (activity) number — the network diagram draws these in order The top right section shows the earliest start time (EST) that an activity can commence based on the completion of the previous activity The bottom right section shows the latest finish time (LFT) by which the previous activity must be completed Activities An activity is something that takes time. An activity is shown on the network as a line, linking the nodes (circles). A description of the activity, or a letter representing the activity, is usually shown above the relevant line Duration The length of time it takes to complete an activity — shown as a number of the relevant units (e.g. hours, days) under the activity line tutor2u-The network diagram - layout H 8 LFT tutor2uSimple project example — revising for exams Task | Activity Dependent on Duration (hours) A | Gather lesson notes and read through _| Starting activity 10 B | Identify gaps in knowledge Completion of task A 3 C | Research online sources Completion of task B 5 D | Procrastinate and browse Facebook Completion of task B 30 E | Write revision plan & revision notes Completion of task B & C 12 F | Practice past exam papers Begin when E complete 8 G | Complete last minute cramming 15 tutor2uCalculating ESTs * The first node will always have an EST of zero! * ESTs are calculated from left to right * Add the duration of an activity to the EST of a previous node * If more than one activity leads to a node, the highest figure becomes the new EST tutor2uCalculating ESTs — Exam Project tutor2uCalculating LFTs * Give the last node of the project an LFT = to the EST * Work backwards from right to left * Subtract the duration of the activity from the LFT tutor2uCalculating LFTs — Exam Project CF “CBs So C3) : 10 J By 15 tutor2uCalculating the float The float is the duration an activity can be extended or postponed so that the project still finishes within the minimum time Calculated as: LFT less Activity Duration less EST tutor2uCalculated float — Exam Project A 10 10 0 an =m im) o fe) oo 13 23 43 35 43 58 3 5 30 12 8 15 10 13 13 18 30 43 MoUs cor w |ur) o fa © fo tutor2uIdentifying the critical path * Activities with a float of 0 (zero) cannot be delayed without delaying the entire project * Such activities represent the “critical path” * On the critical path, activities have an equal EST and LFT tutor2uIdentifying the critical path we Represents the Critical Path for this Project tutor2uUses of critical path analysis * Estimate and minimise project time * Support project costing and evaluation * Plan and organise resources * Prioritise tasks * Help provide direction (more motivating? tutor2uBenefits and drawbacks of CPA Advantages Most importantly — helps reduce the risk and costs of complex projects Encourages careful assessment of the requirements of each activity in a project Help spot which activities have some slack (“float”) and could therefore transfer some resources = better allocation of resources A decision-making tool and a planning tool — all in one! Provides managers with a useful overview of a complex project Links well with other aspects of business planning, including cash flow forecasting and budgeting Disadvantages Reliability of CPA largely based on accurate estimates and assumptions made (CPA does not guarantee the success of a project Resources may not actually be as flexible as management hope when they come to address the network float Too many activities may the network diagram too complicated. Activities might ‘themselves have to be broken dawn into mini-projects tutor2uExample 4. Construct the CPM Network using the details below and determine the critical path Activity Immediate Completion predecessors Time (week) A - 2 B A 3 Cc A 3 D & 4 E D 8 F BE 6 G E 2 Total ...... 28Sw # A(2) 2 B(3) 23 25 0 ag Ps gg (3) bays )Activity Tme Earliest Earliest Latest Latest Slack Critical Start Finish Start finish (LS-ES) path (ES) (BF) (as) (LF) A 2 0 2 0 Z QO Yes B 3 2 5 14) 17 125 No Cc 3 2 5 2 5 0 Yes D 4 5 9 5 9 0 Yes E 8 9 17 9 17 QO Yes F 6 ce 23 |e 23 QO Yes G 2 Bie 25 Wea) 25 0 Yeso oe 88 7 25 eg FO FO. 6 Mt Gta. 7 265 Cr) iF [feCritical Path:- Cp=1-2-3-4-5-6-7 =A-C-D-E-F-G =2+3+4+8+6+2 =25Chocolates anyone? When Cadbury's decided to introduce Flake Bites, to compete with Maltesers and KitKat, Management wanted to know how long it would take to reach full scale production. * Machinery ordering and delivery will take 9 weeks, * Installation takes 5 weeks, * Staff recruitment takes 4 weeks, * Training 2 weeks, * Suppliers need 4 weeks’ lead time, and * Trial production requires 2 weeksStep 1: Network for Flake Bites Node Activity Anode represents: An activity represents a task that is The start of an activity undertaken, eg staff recruitment The end of an activity Both the start and end of an activity. All networks start and end with a node The number represents which step it is. Number 1 means the first stepEarliest Start Time G 5 EST - Earliest start time EST is the earliest time an activity can start. We write this in the top right box in the node: The EST for the first activity is now ie 0 We start from the left and fill in, remembering we cannot start an activity until all the preceding activities have finished, which means the EST is the longest route to a node. Calculating EST allows a firm to organise when it needs resources, and gives the earliest completion date for the whole project. So for example, the earliest we can start on D (installation) is 9 weeks. This means the earliest time Cadbury’s needs its engineers on site to install the machines is 9 weeks after the project startsLatest Finish Time P LFT — Latest Finish Time LFT shows the time by which an activity must be completed. We write this in the bottom right box in the node; it refers to the preceding activity We start from the right and work backwards. The final node will have a LFT of the time a project takes, which will be the EST, in this case 16 weeks. Working back gives 14 weeks as the latest all the preceding activities (B,D and E) have to be finished by. Calculating the LFT provides the deadlines that must be met for the project to be completed on time. It also helps to identify the activities which have slack, or ‘float time’, and identifies the critical pathCritical path Critical Path is marked |] The critical path comprises those activities that take longest to complete, and so which determine the length of the whole project. In this case it is A, D and F, and is indicated by || A, Dand F are the critical activities which must not be delayed by even 1 day ~ because if they are, the whole project is delayed. Identifying the critical path allows managers to apply management by exception, which means management time is spent supervising the critical activities. If a manager sees an activity might be delayed, the manager can consider moving resources (labour or machinery) from a non-critical taskFloat time Float Time The float time shows by how much time an activity may overrun (be delayed) before is has an effect on either the next activity (“Free Float”), or on the project as a whole (“Total Float”) FF = EST start of next task — EST start of this task — duration Activity C (training) FF = 14 - 4 - 2 = 8 weeks float Management can delay / extend training an additional 8 weeks if required TF = LFT of the activity - duration of the activity - the EST of the activity Activity D (installation) TF = 14 - 5 - 9 = 0 weeks float NO Slippage Allowed as D is on the Critical Path