ARBA MINCH UNIVERSITY

SCHOOL OF POST GRADUATE STUDIES

MBA PROGRAM
Group Assignment for OPERATIONAL RESEARCH
ON
NETWORK MODEL ANALIYSIS
GROUP MEMBERS

Name ID No.
1. Iyasu Samuel PRBE/042/11
2. Mesfin Sakato PRBE/061/11
3. Negash Fantahun PRBE/066/11
4. Mengistu Markos PRBE/056/11
5. Samuel Bekele PRBE/070/11
6. Mahedre Zenebe PRBE/047/11

Submitted to Habtamu S. Ph.D.

January 2019
 PART ONE
NETWORK MODEL ANALIYSIS

Networks model the interrelated flows of work that must be accomplished to

complete a project the visually portray the events and activities that are planned
for the project and show their sequential relationships and interdependencies.
Networks generally flow from left to right and may or may not be drawn to
scale on a time-based calendar. Networks have inherent properties that are
quite similar to those of most systems; that is, they are holistic and inclusive and
their elements are interdependent and interconnect at one or more points. In
doing a network analysis, taking a systems approach to producing a fully
elaborated project plan that can subsequently be employed with confidence as a
managerial tool. There are four principal stages in network analysis. Network
Analysis is an excellent example of a comprehensive DSS that supports project
management in the full management cycle of planning and control. It provides a
logical and disciplined framework for classifying objectives and assumptions,
for highlighting what decisions must be made when those decisions must be
made. It provides a framework for evaluating alternative strategies for executing
the project. In particular, the critical path concept provides a means of
managing by exception, rather than managing every detail. This principle that is
not practiced often enough, in part because exceptions and "must-do" activities
are not easily identified and brought to the manager's attention by the
information system. The stages of network model has some

1. Network Generation. This stage begins with specifications of It

moves from the conceptualization of what must be done to the precise
specification of events and activities that are to be carried out in achieving the
goal or objective. The network produced during this stage represents a graphic
model of the project and incorporates time (and sometimes cost) estimates.
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2. Network Evaluation. Once an initial network plan for a project is
completed, it must be assessed by a manager to determine its soundness from
the standpoint of its underlying logic.

3. Network Monitoring. Once adopted, the network plan becomes a

valuable managerial tool for the life of the project. It can be employed
systemized planning system began to reduce a rigidity that was viewed as
counterproductive

4. Network Modification. Monitoring may indicate that the network

plan will have to be altered to maintain necessary managerial control.

BASIC TERM IN NETWORK ANALYSIS

➢ Activity
➢ Events
➢ Constraints
➢ Network diagram
➢ Critical path
Network Analysis is a generic name for a number of procedures which are all
based on the concept of a "network diagram." Some common variants of this
basic approach are PERT (Program Evaluation and Review Technique), CPM
(Critical Path Method) and RAMPS (Resource Allocation and Multiple Project
Scheduling) PERT planning involves the following steps that are described
below.

1. Identify the specific activities and milestones. The activities are the tasks
required to complete a project. The milestones are the events marking the
beginning and the end of one or more activities. It is helpful to list the tasks in a
table that in later steps can be expanded to include information on sequence and
duration.

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2. Determine the proper sequence of the activities. This step may be
combined with the activity identification step since the activity sequence is
evident for some tasks. Other tasks may require more analysis to determine the
exact order in which they must be performed.

3. Construct a network diagram. Using the activity sequence information, a

network diagram can be drawn showing the sequence of the serial and parallel
activities. Each activity represents a node in the network, and the arrows
represent the relation between activities. Software packages simplify this step
by automatically converting tabular activity information into a network
diagram.

4. Estimate the time required for each activity. Weeks are a commonly used
unit of time for activity completion, but any consistent unit of time can be used.
A distinguishing feature of PERT is its ability to deal with uncertainty in
activity completion time. For each activity, the model usually includes three
time estimates:

➢ Optimistic time – generally the shortest time in which the activity can
be completed. It is common practice to specify optimistic time to be three
standards deviations from the mean so that there is a approximately a 1%
chance that the activity will be completed within the optimistic time.
➢ Most likely time – the completion time having the highest probability.
Note that this time is different from the expected time.
➢ Pessimistic time – the longest time that an activity might require. Three
standard deviations from the mean is commonly used for the pessimistic time.
PERT assumes a beta probability distribution for the time estimates. For a beta
distribution, the expected time for each activity can be approximated using the
following weighted average:

Expected time = ( Optimistic + Most likely + Pessimistic )

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This expected time may be displayed on the network diagram.

To calculate the variance for each activity completion time, if three standard
deviation times were selected for the optimistic and pessimistic times, then there
are six standard deviations between them, so the variance is given by:

5. Determine the critical path. The critical path is determined by adding the
times for the activities in each sequence and determining the longest path in the
project. The critical path determines the total calendar time required for the
project. If activities outside the critical path speed up and slow down (within
limits), the total project time does not change. The amount of time that a non –
critical path activity can be delayed without the project is referred to as a slack
time. If the critical path is not immediately obvious, it may be helpful to
determine the following four quantities foe each activity: ES – Earliest Start
time EF - Earliest Finish time LS – Latest Start time LF - Latest Finish time
These times are calculated using the expected time for the relevant activities.
The earliest start and finish times of each activity are determined by working
forward through the network and determining the earliest time at which an
activity can start and finish considering its predecessors activities.

The latest start and finish times are the latest times that an activity can start and
finish without delaying the project. LS and LF are found by working backward
through the network. The difference in the latest and earliest finish of each
activity is that activity’ s slack. The critical path then is the path through the
network in which none of the activities have slack. The variance in the project
completion time can be calculated by summing the variances in the completion
times of the activities in the critical path. Given this variance, one can calculate
the probability that the project will be completed by the certain date assuming a
normal probability distribution for the critical path. The normal distribution
assumption holds if the number of activities in the path is large enough for the

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central limit theorem to be applied. Since the critical path determines the
completion date of the project, the project can be accelerated by adding the
resources required to decrease the time for the activities in the critical path.
Such a shortening of the project sometimes is referred to as project crashing.
Update the PERT chart as the project progresses. Make adjustments in the
PERT chart as the project progresses.

As the project unfolds, the estimated times can be replaced with actual times. In
cases where there are delays, additional resources may be needed to stay on
schedule and the PERT chart may be modified to reflect the new situation.

WHY WE USE PERT/CPM

✓ Prediction of deliverables
✓ Planning resource requirements
✓ Controlling resource allocation
✓ Internal program review
✓ External program review
✓ Performance evaluation
✓ Uniform wide acceptance

Framework for PERT and CPM

➢ Define the Project. The Project should have only a single start activity
and a single finish activity.
➢ Develop the relationships among the activities.
➢ Draw the "Network" connecting all the activities.
➢ Assign time and/or cost estimates to each activity
➢ Compute the critical path.
➢ Use the Network to help plan, schedule, and monitor and control the
project.

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CPM -Critical Path Method

❖ Drafting the design of Program or Project

❖ Evaluation of drafted Program or Project
❖ Review of evaluated Program or Project
CPM Assumptions
❖ Project consists of a collection of well-defined Tasks (jobs)
❖ Project ends when all jobs completed
❖ Jobs may be started and stopped
❖ Independently of each other within a given
❖ Sequence (no “ continuous-flow” processes)
❖ Jobs are ordered “ technological sequence”
PERT -Project Evaluation & Review Techniques
❖ To analyse and represent the tasks involved in completing a given project
❖ Accommodates the variation in event completion time
❖ Event-oriented technique rather than start-and completion-oriented
❖ Commonly used in conjunction with CPM

BENEFITS
❖ PERT is useful because it provides the following information:
❖ Expected project completion time;
❖ Probability of completion before a specified date;

PERT/CPM Networks and LP

Program Evaluation and Review Technique (PERT) and Critical Path Method
(CPM) are two closely related techniques for monitoring the progress of a large
project. A key part of PERT/CPM is calculating the critical path. That is,
identifying the subset of the activities that must be performed exactly as planned
in order for the project to finish on time. We will show that the calculation of
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the critical path is a very simple network LP problem, specifically, a longest
path problem. You do not need this fact to efficiently calculate the critical path,
but it is an interesting observation that becomes useful if you wish to examine a
multitude of “crashing” options for accelerating a tardy project. CPM and
PERT Network models can be used as an aid in the scheduling of large complex
projects that consist of many activities.
➢ CPM: If the duration of each activity is known with certainty, the
Critical Path Method (CPM) can be used to determine the length of time
required to complete a project.

➢ PERT: If the duration of activities is not known with certainty, the

Program Evaluation and Review Technique (PERT) can be used to estimate the
probability that the project will be completed by a given deadline.
❖ CPM and PERT are used in many applications including the following:
✓ Scheduling construction projects such as office buildings, highways and
swimming pools
✓ Developing countdown and “ hold” procedure for the launching of space
crafts
✓ Installing new computer systems
✓ Designing and marketing new products
✓ Completing corporate mergers
✓ Building ships
To apply CPM and PERT, we need a list of activities that make up the project.
The project is considered to be completed when all activities have been
completed. For each activity there is a set of activities (called the predecessors
of the activity) that must be completed before the activity begins. A project
network is used to represent the precedence relationships between activities. In
the following discussions the activities will be represented by arcs and the nodes
will be used to represent completion of a set of activities (Activity on arc
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(AOA) type of network) While constructing an AOA type of project diagram
one should use the following rules:

• Node 1 represents the start of the project. An arc should lead rom node 1
to represent each activity that has no predecessors.

• A node (called the finish node) representing the completion of the project
should be included in the network.

• Number the nodes in the network so that the node representing the
completion time of an activity always has a larger number than the node
representing the beginning of an activity.

• An activity should not be represented by more than one arc in the

network

• Two nodes can be connected by at most one arc.

CPM vs PERT

􀂄 Difference how “task duration” is treated

􀂄 CPM assumes time estimates are deterministic
􀂄 Obtain task duration from previous projects
􀂄 Suitable for “construction”-type projects
􀂄 PERT treats durations as probabilistic
􀂄 PERT = CPM + probabilistic task times
􀂄 Better for R&D type projects
􀂄 Limited previous data to estimate time durations
􀂄 Captures schedule (and implicitly some cost) risk

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PERT
➢ Project Evaluation and Review Technique
➢ Task time durations are treated as uncertain
➢ A - optimistic time estimate
➢ Minimum time in which the task could be completed
➢ Everything has to go right
➢ M - most likely task duration
➢ Task duration under “ normal” working conditions
➢ Most frequent task duration based on past experience
➢ B - pessimistic time estimate
➢ Time required under particularly “ bad” circumstances
➢ most difficult to estimate, includes unexpected delays
➢ should be exceeded no more than 1% of the time

CPM Judgment
❖ +
􀂄 Focuses attention on a subset of critical tasks
􀂄 Determine effect of shortening/lengthening tasks
􀂄 Evaluate costs of a ”crash” program
❖
-
􀂄 doesn’t capture task iterations, in fact …
􀂄 Prohibits iterations = “cycle error”
􀂄 Treats task durations as deterministic
STEPS OF PERT/CPM
1. PLANNING
2. SCHEDULING
3. ALLOCATION OF RESOURCES
4. CONTROLLING

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PERT/CPM for Project Scheduling & Management

1. INTRODUCTION

Basically, CPM (Critical Path Method) and PERT (Programme Evaluation

Review Technique) are project management techniques, which have been
created out of the need of Western industrial and military establishments to
plan, schedule and control complex projects.

1.1 Brief History of CPM/PERT

CPM/PERT or Network Analysis as the technique is sometimes called,

developed along two parallel streams, one industrial and the other military.

CPM was the discovery of M.R.Walker of E.I.Du Pont de Nemours & Co. and
J.E.Kelly of Remington Rand, circa 1957. The computation was designed for
the UNIVAC-I computer. The first test was made in 1958, when CPM was
applied to the construction of a new chemical plant. In March 1959, the method
was applied to a maintenance shut-down at the Du Pont works in Louisville,
Kentucky. Unproductive time was reduced from 125 to 93 hours. PERT was
devised in 1958 for the POLARIS missile program by the Program Evaluation
Branch of the Special Projects office of the U.S.Navy, helped by the Lockheed
Missile Systems division and the Consultant firm of Booz-Allen & Hamilton.
The calculations were so arranged so that they could be carried out on the IBM
Naval Ordinance Research Computer (NORC) at Dahlgren, Virginia.

1.2 Planning, Scheduling & Control Planning, Scheduling (or organising) and
Control are considered to be basic Managerial functions, and CPM/PERT has
been rightfully accorded due importance in the literature on Operations
Research and Quantitative Analysis. Far more than the technical benefits, it was
found that PERT/CPM provided a focus around which managers could
brainstorm and put their ideas together. It proved to be a great communication

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medium by which thinkers and planners at one level could communicate their
ideas, their doubts and fears to another level. Most important, it became a useful
tool for evaluating the performance of individuals and teams. There are many
variations of CPM/PERT which have been useful in planning costs, scheduling
manpower and machine time. CPM/PERT can answer the following important
questions: How long will the entire project take to be completed? What are the
risks involved? Which are the critical activities or tasks in the project which
could delay the entire project if they were not completed on time? Is the project
on schedule, behind schedule or ahead of schedule? If the project has to be
finished earlier than planned, what is the best way to do this at the least cost?

1.3 The Framework for PERT and CPM essentially, there are six steps which
are common to both the techniques. The procedure is listed below:

I. Define the Project and all of its significant activities or tasks. The Project
(made up of several tasks) should have only a single start activity and a single
finish activity.
II. Develop the relationships among the activities. Decide which activities
must precede and which must follow others.
III. Draw the "Network" connecting all the activities. Each Activity should
have unique event numbers. Dummy arrows are used where required to avoid
giving the same numbering to two activities.
IV. Assign time and/or cost estimates to each activity
V. Compute the longest time path through the network. This is called the
critical path.
VI. Use the Network to help plan, schedule, monitor and control the project.

The Key Concept used by CPM/PERT is that a small set of activities, which
make up the longest path through the activity network control the entire project.
If these "critical" activities could be identified and assigned to responsible
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persons, management resources could be optimally used by concentrating on the
few activities which determine the fate of the entire project. Non-critical
activities can be replanned, rescheduled and resources for them can be
reallocated flexibly, without affecting the whole project.

Five useful questions to ask when preparing an activity network are:

Is this a Start Activity?
Is this a Finish Activity?
What Activity Precedes this?
What Activity Follows this?
What Activity is Concurrent with this?
Some activities are serially linked. The second activity can begin only after the
first activity is completed. In certain cases, the activities are concurrent, because
they are independent of each other and can start simultaneously. This is
especially the case in organisations which have supervisory resources so that
work can be delegated to various departments which will be responsible for the
activities and their completion as planned. When work is delegated like this, the
need for constant feedback and co-ordination becomes an important senior
management pre-occupation.

1.4 Drawing the CPM/PERT Network Each activity (or sub-project) in a

PERT/CPM Network is represented by an arrow symbol. Each activity is
preceded and succeeded by an event, represented as a circle and numbered.
4
ES 3
0

EF 1 11

2
4

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At Event 3, we have to evaluate two predecessor activities – Activity 1-3 and
Activity 2-3, both of which are predecessor activities. Activity 1-3 gives us an
Earliest Start of 3 weeks at Event 3. However, Activity 2-3 also has to be
completed before Event 3 can begin. Along this route, the Earliest Start would
be 4+0=4. The rule is to take the longer (bigger) of the two Earliest Starts. So
the Earliest Start at event 3 is 4. Similarly, at Event 4, we find we have to
evaluate two predecessor activities – Activity 2-4 and Activity 3-4. Along
Activity 2-4, the Earliest Start at Event 4 would be 10 wks, but along Activity
3-4, the Earliest Start at Event 4 would be 11 wks. Since 11 wks is larger than
10 wks, we select it as the Earliest Start at Event 4. We have now found the
longest path through the network. It will take 11 weeks along activities 1-2, 2-3
and 3-4. This is the Critical Path. 1.5.3 The Backward Pass – Latest Finish
Time Rule To make the Backward Pass, we begin at the sinker the final event
and work backwards to the first event. 4

4
ES
3
0

0
EF 1
11

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At Event 3 there is only one activity, Activity 3-4 in the backward pass, and we
find that the value is 11-7 = 4 weeks. However at Event 2 we have to evaluate 2
activities, 2-3 and 2-4. We find that the backward pass through 2-4 gives us a
value of 11-6 = 5 while 2-3 gives us 4-0 = 4. We take the smaller value of 4 on
the backward pass. 1.5.4 Tabulation & Analysis of Activities to tabulate the
various events and calculate the Earliest and Latest Start and Finish times. To
compute the SLACK or TOTAL FLOAT, which is defined as the difference
between the Latest Start and Earliest Start.

Event Duration (Weeks) Earliest Start Earliest Finish Latest Start Latest Finish
Total Float Event1-2 Duration (Weeks) 4 Earliest Start 0 Earliest Finish 4 Latest
Start 0 Latest Finish 4 Total Float 0 Event2-3 Duration (Weeks) 0 Earliest
Start4 Earliest Finish 4 Latest Start 4 Latest Finish 4 Total Float 0 Event3-4
Duration (Weeks) 7 Earliest Start 4 Earliest Finish 11 Latest Start 4Latest Finish
11 Total Float 0 Event1-3 Duration (Weeks) 3 Earliest Start 0 Earliest Finish 3
Latest Start 1 Latest Finish 4 Total Float 1 Event2-4 Duration (Weeks) 6
Earliest Start 4 Earliest Finish 10 Latest Start 5 Latest Finish 11 Total Float 1

The Earliest Start is the value in the rectangle near the tail of each activity The
Earliest Finish is = Earliest Start + Duration the Latest Finish is the value in the
diamond at the head of each activity The Latest Start is = Latest Finish –
Duration There are two important types of Float or Slack. These are Total Float
and Free Float. TOTAL FLOAT is the spare time available when all preceding
activities occur at the earliest possible times and all succeeding activities occur
at the latest possible times. Total Float = Latest Start – Earliest Start Activities
with zero Total float are on the Critical Path FREE FLOAT is the spare time
available when all preceding activities occur at the earliest possible times and

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all succeeding activities occur at the earliest possible times. When an activity
has zero Total float, free float will also be zero. There are various other types of
float (Independent, Early Free, Early Interfering, Late Free, and Late
Interfering), and float can also be negative. We shall not go into these situations
at present for the sake of simplicity and be concerned only with Total Float for
the time being. Having computed the various parameters of each activity, we are
now ready to go into the scheduling phase, using a type of bar chart known as
the Gantt chart. There are various other types of float (Independent, Early Free,
Early Interfering, Late Free, and Late Interfering), and float can also be
negative. We shall not go into these situations at present for the sake of
simplicity and be concerned only with Total Float for the time being. Having
computed the various parameters of each activity, we are now ready to go into
the scheduling phase, using a type of bar chart known as the Gantt Chart.

1.5.5 Scheduling of Activities Using a Gantt Chart Once the activities are laid
out along a Gantt Chart (Please see chart below), the concepts of Earliest Start
& Finish, Latest Start & Finish and Float will become very obvious. Activities
1-3 and 2-4 have total float of 1 week each, represented by the solid timeline
which begins at the latest start and ends at the latest finish. The difference is the
float, which gives us the flexibility to schedule the activity. For example, we
might send the staff on leave during that one week or give them some other
work to do. Or we may choose to start the activity slightly later than planned,
knowing that we have a week’ s float in hand. We might even break the activity
in the middle (if this is permitted) for a week and divert the staff for some other
work, or declare a National or Festival holiday as required under the National
and Festival Holidays Act. These are some of the examples of the use of float to
schedule an activity. Once all the activities that can be scheduled are scheduled
to the convenience of the project, normally reflecting resource optimisation
measures, we can say that the project has been scheduled.
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3. The PERT (Probabilistic) Approach So far we have talked about projects,
where there is high certainty about the outcomes of activities. In other words,
the cause-effect logic is well known. This is particularly the case in engineering
projects. However, in Research & Development projects, or in Social Projects
which are defined as “ Process Projects” , where learning is an important
outcome, the cause-effect relationship is not so well established.

In such situations, the PERT approach is useful, because it can accommodate

the variation in event completion times, based on an expert’ s or an expert
committee’ s estimates. For each activity, three time estimates are taken

The Most Optimistic The Most Likely The Most Pessimistic The Duration of an
activity is calculated using the following formula: Where te is the Expected
time, to is the Optimistic time, tm is the most probable activity time and tp is the
Pessimistic time. It is not necessary to go into the theory behind the formula. It
is enough to know that the weights are based on an approximation of the Beta
distribution. The Standard Deviation, which is a good measure of the variability
of each activity is calculated by the rather simplified formula: The Variance is
the Square of the Standard Deviation.

4. PERT Calculations for the Social Project In our Social Project, the Project
Manager is now not so certain that each activity will be completed on the basis
of the single estimate he gave. There are many assumptions involved in each
estimate, and these assumptions are illustrated in the three time

Estimate he would prefer to give to each activity. In Activity 1-3, the time
estimates are 3,12 and 21. Using our PERT formula, we get: The Standard
Deviation (s.d.) for this activity is also calculated using the PERT formula

5. Estimating Risk having calculated the s.d. and the Variance, are ready to do
some risk analysis. Before that we should be aware of two of the most important

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Assumptions made by PERT. The Beta distribution is appropriate for
calculation of activity durations. Activities are independent, and the time
required to complete one activity has no bearing on the completion times of its
successor activities in the network. The validity of this assumption is

Questionable when we consider that in practice, many activities have

dependencies.

5.1. Expected Length of a Project

PERT assumes that the expected length of a project (or a sequence of

independent activities) is simply the sum of their separate expected lengths.
Thus, the summation of all the teas along the critical path gives us the length of
the project. Similarly the variance of a sum of independent

Activity times is equal to the sum of their individual variances. In our example,
the sum of the variance of the activity times along the critical path, VT is found
to be equal to (9+16) = 25. The square root VT gives us the standard deviation
of the project length. Thus, ST=Ö 25=5. The higher the standard deviation, the
greater the uncertainty that the project will be completed on the due date.
Although the teas are randomly distributed, the average or expected project
length Te approximately follows a Normal Distribution. Since we have a lot of
information about a Normal Distribution, we can make several statistically
significant conclusions from these calculations. A random variable drawn from
a Normal Distribution has 0.68 probability of falling within one standard
deviation of the distribution average. Therefore, there is a 68% chance that the
actual project duration will be within one standard deviation, ST of the
estimated average length of the project, te. In our case, the te = (12+16) = 28
weeks and the ST = 5 weeks. Assuming te to be normally distributed, we can
state that there is a probability of 0.68 that the project will be completed within
28 ± 5 weeks, which is to say, between 23 and 33 weeks. Since it is known that
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just over 95% (.954) of the area under a Normal Distribution falls within two
standard deviations, we can state that the probability that the project will be
completed within 28 ± 10 is very high at 0.95.

Summary

● CPM is useful, despite criticism, to identify the critical path - focus on a

subset of the project
● apply flexibility to smooth resource/schedules
● PERT treats task times as probabilistic
● Individual task durations are β-distributed
● Sums of multiple tasks are normal z-distributed
● Selective “ crashing” of critical tasks can reduce total project cost
● CPM and PERT do not allow task iterations

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 PART TWO
ORGANIZATIONAL ANALYSIS
BACKGROUND OF THE ORGANIZATION
RAMA GENERAL CONTRACTOR
RAMA general contractor is a grade (GC/1) Established in 1998 G.C which is
licensed in Ethiopia with its head office in Addis Ababa & Adama branch office
in Adama town, with sufficient capacity for the worker and fully furnished.
Farther more the branch office in Adama with a total area of 16000m2 is used
for maintenance workshop, production of precast units for construction works
and central warehouse. The company’s main objective is to provide engineering
service mainly road construction, railway construction, water works, airfield
construction, real estate development, building and maintenance works.

Company vision mission

To be the best, reliable and competitive construction company and a general

contractor of first choice in the country and in the world. They are dedicated in
providing competitive construction in quality ,cost ,time and environmentally
friendly by providing the best construction service through engaging highly
motivated, skilled ,and productive employees as well as advanced technology

Company values
❖ They value quality, cost, time and customer satisfaction in construction
sector
❖ They strive for a continual learning company
❖ They believe in participatory work, team spirit and respect for employee
❖ They abide by the rules and regulation of the country
❖ They work toward the growth and transformation of the company

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Our group has selected the Building construction of the company under
consideration, especially the construction project in Arbaminch University

Immediate Estimated
Activity Activity Description
Predecessors Duration
A Excavate 2 Weeks
B Lay the foundation A 4 weeks
C Put up the rough wall B 10 weeks
D Put up the roof C 6 Weeks
E Install the exterior plumbing C 4 Weeks
F Install the interior plumbing E 5 Weeks
G Put up the exterior siding D 7 Weeks
H Do the exterior painting EG 9 Weeks
I Do the electrical work C 7 Weeks
J Put up the wallboard FI 8 Weeks
K Install the flooring J 4 Weeks
L Do the interior painting J 5 Weeks
M Install the exterior fixtures H 2 Weeks
N Install the interior fixtures KL 6 Weeks

Based the data procured and analysed any given activity and its immediate
predecessors (as given in the third column those activities that must be
completed by no later than the starting time of the given activity. (Similarly, the
given activity is called an immediate successor of each of its immediate
predecessors. Every activity of the organization is done chronologically or
orderly.

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Example

➢ Excavation does not need to wait for any other activities.

➢ Excavation must be completed before starting to lay the foundation.
➢ The foundation must be completely laid before starting to put up the
rough wall, etc.
When a given activity has more than one immediate predecessor, all must be
finished before the activity can begin.

In order to schedule the activities, The Company has higher-level professional

and consults with each of the crew supervisors to develop an estimate of how
long each activity should take when it is done in the normal way for the project.
Fortunately, some of the activities can be done in parallel, which substantially
this can reduces the project completion time.

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The critical path

➢ A path through a project network is one of the routes following the arcs
from the START node to the FINISH node. The length of a path is the sum of
the durations of the activities on the path. There are six paths through the
project network

Path length
START-A- B- C-D- G- H- M- FINISH 40 weeks
STAR-A-B-C-E-H-M- FINISH 31 weeks
START-A-B-C-E-F-J-K-N-FINISH 43 weeks
START-A-B-C-E-F-J-L-N-FINISH 44 weeks
START-A-B-C-I-J-K-N -FINISH 41 weeks
START-A-B-C-I-J-L-N-FINISH 42 weeks

The project duration equals the length of the longest path through the project
network. This longest path is the critical path. Time-cost trade-offs for
individual activities.

Time Cost Maximum Crash Cost

Activity Reduction per Week
Normal Crash Normal Crash
in Time Saved
A 2 weeks 1 week $180,000 $280,000 1 week $100,000
B 4 weeks 2 weeks $320,000 $420,000 2 weeks $50,000
C 10 weeks 7 weeks $620,000 $860,000 3 weeks $80,000
D 6 weeks 4 weeks $260,000 $340,000 2 weeks $40,000
E 4 weeks 3 weeks $410,000 $570,000 1 week $160,000
F 5 weeks 3 weeks $180,000 $260,000 2 weeks $40,000
G 7 weeks 4 weeks $900,000 $1,020,000 3 weeks $40,000
H 9 weeks 6 weeks $200,000 $380,000 3 weeks $60,000
I 7 weeks 5 weeks $210,000 $270,000 2 weeks $30,000
J 8 weeks 6 weeks $430,000 $490,000 2 weeks $30,000
K 4 weeks 3 weeks $160,000 $200,000 1 week $40,000
L 5 weeks 3 weeks $250,000 $350,000 2 weeks $50,000
M 2 weeks 1 week $100,000 $200,000 1 week $100,000
N 6 weeks 3 weeks $330,000 $510,000 3 weeks $60,000

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Depend on the information in Table our group has developed the following
items of questionnaire so as to accomplish the objective of the assignment.
1. What is the total time required to complete the project if no delays occur?
Ans. Before 44 weeks

2. For the activities, how much delay can be tolerated without delaying
project completion?

According the experience they had the project of real estate construction
doesn’t have more delay while comparing other projects of the company.so
based on the information real estate company project have 8 weeks as a
permissible delay.

3. If extra money is spent to as additional expenditure for the project, what

is the least expensive way of attempting?

Most of the time their project is suffering by extra cost because of price
increment of different materials due to foreign exchange devaluation as we
know most of real estate construction material will be imported from abroad,
that way they are facing to expend extra money but they can cover this one by
central buying of materials for large number of projects, which allow the
company to obtain quantity discounts and there by achieve economies of scale.

4. When the individual activities start and finish (at the earliest) if no delays
occur?

Every individual activity of the organization usually target at a specific calendar

and date of the project starting and finishing time late finish(LF) latest time a
job can be finished without delaying the project beyond its target time(T) late
start LS=LF-t
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5. Which are the critical bottleneck activities where any delays must be
avoided to prevent delaying project completion? As we know construction
activity can be divide in to substructure and super structure works.so the
substructure parts of activity can be bottleneck of the project. Example
Excavation and lay the foundation.

RECOMMENDATION

The organizations use the networking system for limited activity according to

our group recommendation we advise them it is better to use the network

system for each and every activity.

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 APPENDEX

Questions

1. What is the total time required to complete the project if no delays occur?

2. For the activities, how much delay can be tolerated without delaying
project completion?

3. If extra money is spent to as additional expenditure for the project, what

is the least expensive way of attempting?

4. When the individual activities start and finish (at the earliest) if no delays
occur?

5. Which are the critical bottleneck activities where any delays must be
avoided to prevent delaying project completion?

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 GLOSSARY OF TERMS

Critical Path: The longest path in the network. The path along which any
delay will cause a delay in the project completion time.

Network Diagram: A logical flow diagram showing the work to be performed

in a project. Activities are usually represented by arrows that are connected in a
manner which shows which activities have to be performed before others can
begin.

Predecessor Activity: Any activity that must be completed before another

activity can be performed.

Uncertainty: Refers to the degree of error inherent in the time estimate for an
activity's completion.

Project Duration: The total time required to complete all of the activities that
comprise the project. Since some activities may be performed simultaneously,
the project duration is equal to the time required for the longest path (measured
in time) within the network.

Near-Critical Activity: An activity with a slack time that is close to zero, e.g.
one day or one time unit.

Critical Activity: An activity with no (zero) slack. An activity that falls along
the critical path.

Non-Critical Activity: An activity with a substantial amount of slack time.

Slack: The time that an activity's start can be delayed without delaying the

Completion time of the project. The additional time available to complete an

activity without increasing the project duration.

Normal Cost: The regular direct cost of performing the activity in the normal

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Planned time. Usually the minimum cost for performing the activity.

Normal Time: The regular planned time needed to perform an activity at the

Normal Cost. Usually the minimum time for performing the activity.

Crash Cost: The direct cost associated with performing an activity in the crash
time. Since the crash time is shorter than the normal time, the crash Cost is
higher than the normal cost.

Crash Time: The shortest time for completing an activity using whatever
means that are available. Since reducing (crashing) activity time expends
resources, the costs of achieving the crash time are higher than the normal cost.

Crashing Cost Per Day: The direct cost per day for reducing the time needed
to complete an activity. Usually determined by calculating the per day cost
between the crash time and cost and the normal time and cost.

Uncrashing: Increasing the time to perform an activity in the interest of saving

Direct cost. Typically done when an activity was crashed, but the effect was
unnecessary because of delays in other parts of the network.

Schedule (activities): The process of specifying which activities will be

performed at what time. Usually done by setting the start date or time of each
activity in the network.

Early Start Schedule: The schedule in which all activities are started at their
earliest possible start time.

Latest Start Schedule: The schedule in which all activities are started at their
latest possible start time.

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 REFERENCES

➢ Wiest, Jerome D., and Levy, Ferdinand K., A

➢ Management Guide to PERT/CPM, New Delhi:

➢ Render, Barry and Stair Jr., Ralph M. –

➢ Quantitative Analysis for Management,

➢ Massachusetts: Allyn & Bacon Inc., 1982, pp. 525-563

➢ Freund, John E., Modern Elementary Statistics,

➢ Deffersa construction plc portfolio

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