Bhole_M9 - Project Management: A Managerial Approach...

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Project Management: A Managerial Approach Chapter 9 – Resource Allocation
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Overview Critical Path Crashing Resource Leveling Resource Constrained Schedules Critical Chain
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Critical Path Method - Crashing a Project CPM includes a way of relating the project schedule to the level of physical resources allocated to the project This allows the project manager to trade time for cost, or vice versa In CPM, two activity times and two costs are specified, if appropriate for each activity Chapter 9-1
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Critical Path Method - Crashing a Project The first time/cost combination is called normal, and the second set is referred to as crash Normal times are “normal” in the same sense as the ‘m’ time estimate of the three times used in PERT Crash times result from an attempt to expedite the activity by the application of additional resources Chapter 9-2
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Critical Path Method - Crashing a Project Careful planning is critical when attempting to expedite (crash) a project Expediting tends to create problems; and the solution to one problem often creates several more problems that require solutions Some organizations have more than one level of crashing Chapter 9-3
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Crashing – Sample Network 1 2 3 4 5 6 7 3 6 10 11 8 5 6 0 Critical Path = 3 + 6 + 8 + 6 = 23 Time Units
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Crashing – An Example Activity Normal Time Normal Cost Crash Time Crash Cost Slope Max Crsh Tm 1-2 3 $50 2 $70 2-3 6 $80 4 $160 2-4 10 $60 9 $90 2-5 11 $50 7 $150 3-6 8 $100 6 $160 5-7 5 $40 4 $70 6-7 6 $70 6 $70
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Crashing – Sample Network 1 2 3 4 5 6 7 $50 $80 $100 $70 “Normal” Project Total Cost = $50 + $80 + $100 + $70 + $60 + $50 + $40 = $450
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Crashing – An Example Activity Normal Time Normal Cost Crash Time Crash Cost Slope Max Crsh Tm 1-2 3 $50 2 $70 20 1 2-3 6 $80 4 $160 40 2 2-4 10 $60 9 $90 30 1 2-5 11 $50 7 $150 25 4 3-6 8 $100 6 $160 30 2 5-7 5 $40 4 $70 30 1 6-7 6 $70 6 $70 0 0
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Crashing – Sample Network 1 2 3 4 5 6 7 $50 $80 $100 $70 “Normal” Project Total Cost = $50 + $80 + $100 + $70 + $60 + $50 + $40 = $450 Critical Path = 23 Days 3 6 8 6 $60 $50 $40 10 11 5
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Crashing – Sample Network 1 2 3 4 5 6 7 $70 $80 $160 $70 “Crashed” Project Total Cost = $70 + $80 + $160 + $70 + $60 + $50 + $40 = $530 Critical Path = 23 Days 2 6 6 6 $60 $50 $40 10 11 5 “Crashed”Path = 20 Days
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Fast-Tracking Another way to expedite a project is known as
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Bhole_M9 - Project Management: A Managerial Approach...

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