JSPM Group of Institutes

Session Objectives
Course: Civil Engineering

Project Management and Engineering Economics

UNIT III

Session Session Objective

What is projecting Monitoring? How does project control? Monitoring and

18
controlling tools.
To allocate an effective force as per project requirement and availability of
19
resources.

20 Finding EFR and IFR on basis of Resource leveling.

21 Remembrance of cost included in project.

22 Finding a optimal time with minimum cost for project.

23
Updating of network from the date of failure of monitoring.
24

25 Introduction of S/W in project planning and monitoring.

26
Ready to implement monitoring and controlling for real life project.
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3.1 Resource allocation

It is a process and strategy involving a company deciding where scarce resources should
be used in the production of goods or services. A resource can be considered any factor of
production, which is something used to product goods or services. Resources include such things
as labor, real estate, machinery, tools and equipment, technology, and natural resources as well as
financial resources such as money. The network analysis for PERT/CPM, carried out so far is
valid only if the availability of resources are not available in unlimited quantities. Availability of
manpower may be restricted. Availability of funds, credits, capital investment and heavy
equipment may be restricted. In some cases there may be space limitations, which prevent more
than one or two technicians working simultaneously. Large fluctuations in their demand may
cause problems in project execution Planning should be done in such a manner that resources are
utilized in more or less uniform manner. This can be achieved by following two approaches.

(a) Resources smoothing

(b) Resources leveling.

3.1.1 Resources smoothing

What is resource smoothing? Is it the process of reducing the allocation of resources on

the tasks (for example, a resource which is allocated at 90% is allocated at 70% after resource
smoothing) Resource smoothing means the uniform distribution of resource allocation over the
project (I know this sounds like a very complicated statement, but I will explain and you'll see
that the concept is very easy). It typically does not affect project schedule, because the total
allocation of a certain resource remains the same. This is the first approach known as resources
smoothing method, the total project duration is not changed, but some of the activities start times
are shifted by their available floats so that a uniform demand for the resources is generated.
However, the resources considered to be unlimited. In second approach , known as resources
leveling ,the activity start times are re scheduled that peak demand for a particular resources does
not cross the available limit of the resources. In rescheduling the activities, the floats are first
used, but if it does not project duration may be changed.

If the duration of completion of the project is the constraints, then resource smoothing
should be applied without changing the total project duration. The periods of minimum demand
for resources are located and the activities are shifted according to the float availability and
requirement of resources. Thus the intelligent utilization of floats can smoothen the demand of
resources to the maximum possible extent. This type of resource allocation is called Resource
smoothing.

Steps involved in Resource smoothing

1. List out resources which will be required for execution of the various activities and identify
the ones which considered important.

2. Resource profiles are prepared by carrying out resources aggregation exercise and cumulative
resource requirement for each unit are plotted in form of histograms.

3. The periods of peak and low demands are identified and an attempt is made to lower the peaks
and to fill up the troughs.

4. If there is no constraint on the availability of resources, make the demand as uniform as

possible. This can be achieved by altering the times of start and finish of non critical activities, to
start with. These activities have certain amount of float. Therefore the available float can be used
for making adjustments in the start or finish of the activities concerned and thus, lowering of the
peak demands by staggering of the resource requirement without delaying the project duration.
3.1.2 Resource leveling

It is defined by PMBOK is a (project management) "technique in which start and finish

dates are adjusted based on resource constraints with the goal of balancing demand for resources
with the available supply. When performing project planning activities, the manager will
attempt to schedule certain tasks simultaneously. When more resources such as machines or
people are needed than are available, or perhaps a specific person is needed in both tasks, the
tasks will have to be rescheduled concurrently or even sequentially to manage the constraint.
Project planning resource leveling is the process of resolving these conflicts. It can also be used
to balance the workload of primary resources over the course of the project, usually at the
expense of one of the traditional triple constraints (time, cost, scope). Resource leveling is
scheduling decisions, which are driven by resource management concerns, such as limited
resource availability. Resource leveling is the part of the scheduling process in which the start
and end dates of tasks are driven by resource limitations, i.e. limited availability of resources or
hard to manage resource levels. One of the objectives of project scheduling is to ensure that
resources are not over-allocated or over-burdened, and that there are not significant ups and
downs in the resource schedule. In the process of resource leveling, whenever the availability of
resources become less than its maximum requirement, two or more activities require the same
amount of resources, the activity with minimum duration is chosen for resource allocation.
Resource leveling is done if the restriction is on the availability of resources.

Steps Involved in Resource Leveling

1. Lower the peak requirement of the resources by staggering the resource input on critical non
critical activities. If necessary, sub critical and critical activities can also be tackled to bring peak
demands below the specified levels. Thus, the completion of work may be delayed due to
resource constraints.

2. Either increase the duration of critical activities or place some of the concurrent activities in
series to reduce the peak demands of the scare resources. This will increase the duration of the
project.

3. Re arrange the activities in descending order of the magnitude of the positive float, as
resources can be conveniently diverted from the activities which possess large amount of float.
Lower the high peaks of the resource demand by utilizing the free floats of the activities. Then
non-critical should be rescheduled to the extent required by utilizing having the highest float.
Critical activities can be tackled, if necessary.
3.2 Network Crashing

The use of CPM network is not limited to estimation of project duration or calculation
of critical duration. In a project there may arise situations wherein it would be desirable to
cut down the total project time. This naturally leads to cost considerations. Also; the cost will
increase as the time duration increases. But if the project is to be completed at an early date,
then it requires deployment of more resources which again increases the cost.

Crashing is the process of attempting to shorten project activities and in turn the overall
project by assigning additional resources.

Of course, the resources to do this must be available

Crashing a project changes the schedule for all activities

This will have an impact on schedules for all the subcontractors

Crashing a project often introduces unanticipated problems and the solution to one
problem often creates other problems.

Time and cost are interrelated.

The faster an activity is completed, the more it costs.

Change the schedule and you change the budget.

Thus many activities can be speeded up by spending more money

3.2.1 Implications of crashing

Crashing might result in a change in production function for doing activities

In simple terms might involve increasing the resources to do something 8 people to dig a
ditch instead of 4 people (or labor shovels)

Or human resources could be replaced by technology Dig the ditch with a machine.
 Changes in production function might increase project risk as well as cost

Calculating cost/time slope.

3.2.2 Direct Cost

Direct costs of project depend on the completion time. But, the variation is not linear.
Normally, there is an optimum duration for a project for which he direct cost is a minimum.
During this time, the resources are optimally used. This duration of the project is usually called
normal duration.

Direct cost of the project depends on completion time. But, the variation is not linear.
Normally there is an optimum duration for a project for which direct cost is a minimum. During
this time, the resources are optimally used. This duration of the project is usually called normal
duration. The duration of the project can be reduced below the normal duration. But, it increase
the direct cost due to deployment of additional resources. A typical direct cost-time curve curve
is shown.It can be seen that the direct costs increase if either time is increased or decreases
beyond normal duration.

Direct cost
Cost

Crash Normal

Time

Figure1. Direct Costs of

Projects
The curve has the following characteristics:

1. There is a point on the curve where the cost is a minimum corresponding to an optimum
duration (Normal duration).

2. The direct cost increases on either side of normal duration but at a steady rate on the higher
side of normal duration.

3. There is point beyond which the project duration cannot be reduced irrespective of the
increase in direct cost. This duration is called the crash duration and corresponding cost is known
as crash cost.

3.2.3 Indirect cost

In addition to cost of buying resources and cost of operations involved, every project
incurs some indirect costs in term of overheads, administrative expenses, depreciation, loss of
project, loss of revenue profit, pentalty.These indirect costs increase with duration. The loss in
profit, penalty incurred etc. come under outage loss. A combination of these costs when drawn
against time a curve.

Cost

Time

Figure2. Indirect Cost of

Project
To determine if crashing makes sense, a cost/time slope is calculated for each activity that can be
expedited (crashed). The formula looks like this:

Crash Cost - Normal Cost

Slope
Crash Time - Normal Time

3.2.4 Total Project Cost

The direct and indirect project cost added together constitutes the cost the total project
cost. The direct costs do not a linear relationship with time. As a result, a combination of
indirect and direct time. It can be seen that total project cost is a minimum for certain
duration. The corresponding duration is called optimum duration for the minimum cost. Also
the optimum duration for the minimum costs.

Normal Time: Normal time is the standard time that an estimator would usually allow for an
activity.

Crash time: This is the direct cost required to complete the activity in normal time duration.
Crash cost: This is the direct cost corresponding to the completion of the activity within
crash time.

Cost slope: the direct cost curve as already seen is a curve. But this curve can be
approximated by a straight line or more than one straight line, depending upon the flatness of
the curve. the slope of this straight line is the cost slope.

Figure3. Costs of
Projects

Two Principles involved in crashing a project:

Crashing a noncritical activity will not influence project duration

When shortening a projects duration, select the least expensive way to do it.
3.3 Updating

The process of incurring change, and replanting or rescheduling is called updating. The
conventional approach to updating is the complete re-computation of all data. The three basic
changes that make updating necessary are as under.

1. Changes in the project plan

2. Rescheduling activities

3. Changes in duration of an activity

If all activities are progressing well accordingly to plan and schedule, then there is no
need for updating. But, practically speaking, due to delays the duration of undefined activities
are revised and thus the network diagram is redrawn.

3.3.1 The major reasons for the changes made in project plan are:

1. Due to the unforeseen difficulties, natural calamities and changed condition at the site of
project.

2. To develop better and more detailed plans based on additional knowledge of the job.

The major changes in the rescheduling occur due to the following reason.

3.3.2 Data required for Updating

The following information is necessary to update the plan at an intermediate stage of execution
of a project

1. Original network

2. Progress report

3. Calculated charts.

4. New information and knowledge which will affect the duration in the future.
3.3.3 Methods of Updating

1. By describing the stage.

2. By recording the Progress.

3. By summarizing the work.

4. By calculations.

3.3.4 Updating Flowchart

Planning nd Yes or
scheduling No
Project Network action
Comparaing
Directions to be with original
issued one.Is it
satifactory?

Exectute the
Report Progress
Project

Record and
assess Progress

Completion

Figure4. Flowchart for

Updating
 3.4 Introduction to Project Management soft wares

Primavera P6 Professional Project Management, the recognized standard for high-

performance project management software, is designed to handle large-scale, highly
sophisticated and multifaceted projects. It can be used to organize projects up to 100,000
activities, and it provides unlimited resources and an unlimited number of target plan. Primavera
was launched in 1983 by Primavera Systems Inc. and was acquired by Oracle Corporation in
2008. Primavera software includes project management, collaboration and control capabilities
and integrates with other enterprise software such as Oracle or SAPs ERP systems. The Project
Management module enables your organization to store and manage its projects in a central
location. The module supports work breakdown structures (WBS), organizational breakdown
structures (OBS), user-defined fields and codes, critical-path-method (CPM) scheduling, and
resource leveling.

3.4.1 Benefits
Balance resource capacity.
Plan, schedule, and control complex projects.
Allocate best resources and track progress.
Monitor and visualize project performance versus plan.
Conduct what-if analysis and analyze alternative project plan.

3.4.2 Why Primavera is required?

Gives complete Project Management Solution.

Internationally Reputed.

Having Flexibility to Manage Multiple Projects in Centralized location.

Provides facility to Integrate ERP or Accounting System.

It is Web based Project Management gives the project team anywhere, anytime access to
the projects they are assigned to work on.
 A 100% Web-based user interface covers the full project management lifecycle from
project initiation through to project closeout.

It gives the creation of Work Breakdown Structure (WBS) and activities, documenting
and managing project risks and issues, managing status updates, and reporting on key
performance indicators like earned value.

By using Primavera Project Management, organizations can ensure that the project team
members are communicating with each other, whether it is regarding activity status
updates, scope changes, revisions to documents, or issue(s) resolution.

3.4.3 Brief about Techniques used for Scheduling Projects

CPM Critical Path Method

The method by which activity durations and the relationships between activities are used
to mathematically calculate a schedule for the entire project. CPM focuses attention on the
critical path of activities that affect the completion date for the project or an intermediate
deadline.

Early dates, the earliest possible dates each activity can start and finish, and late dates, the
latest possible dates each activity can start and finish without delaying the project finish or an
intermediate deadline (constraint) are also calculated.

PERT

The program evaluation and review technique (PERT) uses the same ideas as CPM; but
(EPS)
instead of using just the most likely time estimate, it uses a probabilisticEnterprise
estimate of time for
Project
Structure
completion of an activity

3.4.4 Structuring Projects Projects

1. Setting-up and define EPS (Enterprise Project Structure).

(WBS)
2. Add a project to the EPS hierarchy. Work Breakdown
Structure

3. Defining WBS (Work breakdown structure) to the Project.

Activities

(OBS)
Organisational
Breakdown
Structures
 4. Defining OBS (Organizational breakdown structure).

5. Defining Resources.

6. Create Calendar for Activities & Resources.

Figure5. Structuring of
Project
7. Add activities to WBS.

8. Input activity details.

9. Schedule project.

10. Updating progress after project starts.

11. Preview / Print reports (Default / Custom made reports).

3.4.5 EPS (Enterprise Project Structure)

The Enterprise Project Structure (EPS) forms the hierarchical structure of your database
of projects.

Each EPS node (or folder) can be subdivided into multiple levels to represent the work
that needs to be done in your organization. The number of levels and their structure depend on
the scope of your projects and how you want to summarize data.
3.4.6 WBS (Work Breakdown Structure)

A WBS is a hierarchy of work that must be accomplished to complete a project, which

defines a product or service to be produced. The WBS is structured in levels of work detail,
beginning with the deliverable itself, and is then separated into identifiable work elements.
Project

Civil Works

Roads &
Buildings
Drains

Equipment
Ware House
Fdns

Foundation

Superstructure

Finishing
Works

Admin Building

Mech. Works

Tanks Piping

Fire Water
Tank

Diesel Tank

Figure6. WBS for small

project
3.5 Use of Primavera

3.5.1 Defining Resources

Resources include the personnel and equipment that perform work on activities across all
projects. Resources are generally reused between activities and/or projects

3.5.2 Creating Calendars

Create and assign calendars to each resource and each activity. These calendars define the
available work-hours in each calendar day. We can also specify national holidays, your
organization's holidays, project-specific work/non-workdays, and resource vacation days.
Calendar assignments are used for activity scheduling, tracking, and resource leveling.
3.5.3 Updating Progress

To update the progress of the individual activity, the following inputs are to be given in
the activity detail form.

1. Start Date (If activity is started)

2. Finish Date (If activity is completed)

3. % of duration completed (if activity is in progress)

4. Remaining duration to complete the activity

3.6 Microsoft Project

3.6.1 What is Microsoft Project?

Microsoft Project (or MSP) is a project management software program

It is designed to assist project managers in:

developing plans

assigning resources to tasks

tracking progress

managing budgets

analyzing workloads
 It is a project management software program, developed and sold by Microsoft, which is
designed to assist a project manager in developing a plan, assigning resources to tasks, tracking
progress, managing the budget, and analyzing workloads.

3.6.2 Short History of MSP

The first Windows version in 1990

During 1990s there were also versions for Mac

The latest version for Windows is Microsoft Office Project 2007

3.6.3 Features

Project creates budgets based on assignment work and resource rates

Resources people, equipment and materials

Resources can be shared between projects using a shared resource pool

Each resource can have its own calendar

Limitation - MS Project presumes additional physical raw materials are always available
without limit

3.6.4 Build Plan Activities:

Define a project

Plan project activities

Plan for a procure resources

Plan project costs

Plan for quality and risks

Plan communication and security

Optimize a project plan

 Print and distribute project information

3.6.5 Case study

a) Calendar:

b) WBS:

The WBS is structured in levels of work detail, beginning with the deliverable itself, and
is then separated into identifiable work elements.

Each project has its own WBS.

Each WBS element may contain more detailed WBS levels, activities, or both.

When creating a project, the project manager typically develops the WBS first, assigns
documents to each WBS element.
c) Linking of activities:

d) Define and Assign Resources

Resource: A resource is a source or supply from which benefit is produced.

Resources are:

1. Work Resource

2. Material Resource

3. Cost Resource
Figure7. Status Bar
e) Resource Sheet

f) Resource Allocation
 1) Study of various resource allocation
techniques?
2) When we need to update Projects and what
are causes of it?
3) Various softwares used for monitoring of
project.

Dictation of Notes

Software training of MSP and Primavera

Solving various examples

What are various types of resources?
What is earn value cost?
Does all project manager used softwares for
monitoring?
Session outcome

1. Able to understand the monitoring and controlling of the project.

2. Able to allocate effective force as per project requirement and availability of the
resources.
3. Able to find out the EFR & IFR on the basis of resource leveling.
4. Able to know the cost included in project.
5. Able to find out the optimal time with minimum cost for a project.
6. Able to update network from the date of failure of monitoring.
7. Able to know the software used in project planning & monitoring
8. Able to implement, monitoring & controlling for real life project.

JSPM Group of Institute

 Course: Civil Engineering

Project Management- Assignment

Unit III

Que.1 what are objectives of resource leveling? Explain the procedure of carryout resource
leveling.

Que.2 Explain the term Rescheduling and updating. Explain under which conditions updating
is carried out. Also write the procedure for updating the network.

Que.3 Define cost slope and what do you understand by crashing of network?

Que. 4The following table gives the duration and cost data for various activities of construction
project. Indirect cost is Rs. 500 per day.

1. Draw CPM network. Calculate project duration, highlight critical path. Calculate normal
cost of the project.

2. Calculate optimum duration and optimum cost of the project by stage by stage
compression.

Activity Duration Cost

Normal (days) Crash(days) Normal(Rs.) Crash(Rs.)

1-2 9 7 2000 3200

1-3 7 3 5000 5300

2-4 3 1 7000 7200

2-5 5 3 1100 1200

3-5 4 1 5100 5700

4-6 5 3 1000 1800

5-6 6 4 1000 1400

Que. 5 Manpower requirement for various Activities of a project are given below:
 Activity (i-j) Duration (Days) Number of Men required
1-2 7 12
2-3 7 7
2-4 8 12
2-5 7 8
3-5 12 8
4-5 8 6
5-6 9 6
Que. 6 Write down advantages and limitations of MSP & Primavera.

Que. 7 Write down the steps involved in MSP & Primavera for scheduling of the project?