Project Management

CPM/PERTBy

Dr. Neeraj Anand

Basic Concepts in the Development of Project Construction Plans

• Project Construction planning is a fundamental and challenging activity in the management and execution of construction projects. It involves the choice of technology, the definition of work tasks, the estimation of the required resources and durations for individual tasks, and the identification of any interactions among the different work tasks.

Cont.

Choice of Technology & Construction Method

As in the development of appropriate alternatives for facility design, choices of appropriate technology and methods for construction are often ill-structured yet critical ingredients in the success of the project. For example, a decision whether to pump or to transport concrete in buckets will directly affect the cost and duration of tasks involved in building construction. A decision between these two alternatives should consider the relative costs, reliabilities, and availability of equipment for the two transport methods.Ambuja Cement in H.P. has longest Conveyor belt (7 km) to transport the limestone over three hills saving significant time and cost.

Planning Activities and Tasks

An activity is any subdivision of project tasks. Generally, it is representated by an arrow.The set of activities defined for a project should be comprehensive or completely exhaustive so that all necessary work tasks are included in one or more activities. Typically, each design element in the planned facility will have one or more associated project activities. Execution of an activity requires time and resources, including manpower and equipment. The time required to perform an activity is called the duration of the activity.

Cont. Even further, the sub-task "clean concrete forms" could be

subdivided into the various operations:• Transport forms from on-site storage and unload onto the

cleaning station.• Position forms on the cleaning station.• Wash forms with water.• Clean concrete debris from the form's surface.• Coat the form surface with an oil release agent for the next

use.• Unload the form from the cleaning station and transport to

the storage location.

Example: Task Definition for a Road Building Project

Project Planning Techniques• Gantt Chart

CPM - Critical Path Method

DuPont developed a Critical Path Method (CPM) designed to address the challenge of shutting down chemical plants for maintenance and then restarting the plants once the maintenance had been completed.

• Complex project, like the above example, require a series of activities, some of which must be performed sequentially and others that can be performed in parallel with other activities. This collection of series and parallel tasks can be modeled as a network.

Cont. Steps in CPM Project Planning• 1. Specify the individual activities.• 2. Determine the sequence of those activities.• 3. Draw a network diagram.• 4. Estimate the completion time for each activity.• 5. Identify the critical path (longest path through the

network)• 6. Update the CPM diagram as the project progresses.

Cont. CPM Benefits• Provides a graphical view of the project.• Predicts the time required to complete the project.• Shows which activities are critical to maintaining the schedule and

which are not. CPM Limitations• While CPM is easy to understand and use, it does not consider the

time variations that can have a great impact on the completion time of a complex project. CPM was developed for complex but fairly routine projects with minimum uncertainty in the project completion times. For less routine projects there is more uncertainty in the completion times, and this uncertainty limits its usefulness.

Example

PERT

• The Program Evaluation and Review Technique (PERT) is a network model that allows for randomness in activity completion times. PERT was developed in the late 1950's for the U.S. Navy's Polaris project having thousands of contractors.

• It has the potential to reduce both the time and cost required to complete a project.

Cont. Steps in the PERT Planning Process• PERT planning involves the following steps:• 1. Identify the specific activities and milestones.• 2. Determine the proper sequence of the activities.• 3. Construct a network diagram.• 4. Estimate the time required for each activity.• 5. Determine the critical path.• 6. Update the PERT chart as the project progresses.

Cont. Benefits of PERT PERT is useful because it provides the following information:• Expected project completion time.• Probability of completion before a specified date.• The critical path activities that directly impact the completion

time.• The activities that have slack time and that can lend

resources to critical path activities.• Activities start and end dates.

Can be used for calculating variance or standard deviation of the project.

Cont. Limitations of PERT The following are some of PERT's limitations:• The activity time estimates are somewhat subjective and

depend on judgment. In cases where there is little experience in performing an activity, the numbers may be only a guess. In other cases, if the person or group performing the activity estimates the time there may be bias in the estimate.

• The underestimation of the project completion time due to alternate paths becoming critical is perhaps the most serious.

ExampleConsider a task whose best/nominal/worst estimate is 3/5/9. The expected completion time (µ) is assumed to be (4*nominal + best + worst)/6, or in our case (4*5+3+9)/6 or about 5.33. The standard deviation (s) is assumed to be (worst - best)/6 or (9-3)/6 or 1.Now consider a simple project consisting of three tasks. We represent this as a simple chart with circles and arrows. The circles denote events, and the arrows denote tasks.

• If the first task begins on day zero, what day can we expect the third task to complete? The chart below shows the expected durations, and we can just add them up. So the expected duration of the project is 5.33 + 6 + 9.67 or 21 days.

Cont.• A more interesting question is the probability of making that

date. A bit of simple reflection will convince you that if the estimates are correct then there is a 50-50 chance that the project will finish on time. There is just as much chance that it will be late as early.

•The end date for the project is a random variable that has its own µ and s. We already know that µ for the project is 21 days. The s for the project can be calculated by summing s 2 for each task, and taking the square root of the result, or (12 + 1.332 + 1.332)½ = 2.13.

Performance Monitoring

• once the project is completed, performance review should be done periodically to compare actual performance with projected performance. Feedback on project is useful in several ways:

• a) It helps us to know how realistic were the assumptions underlying the project

• b) It provides a documented log of experience that is highly valuable in decision making in future projects

• c) It suggests corrective action to be taken in the light of actual performance d) It helps in uncovering judgmental biases

• e) It includes a desired caution among project sponsors.

Implementation Plan for Top Management

As a result of energy audit, many energy saving opportunities would emerge. These could be classified broadly as measures with and without investment. House keeping measures and moderate cost measures need no intervention from top management.

TERMINOLOGY

• PERT event: a point that marks the start or completion of one or more activities

• Predecessor event: an event that immediately precedes some other event without any other events intervening.

• Successor event: an event that immediately follows some other event without any other intervening events.

• PERT activity: the actual performance of a task which consumes time and requires resources (such as labor, materials, space, machinery).

• optimistic time (O): the minimum possible time required to accomplish a task, assuming everything proceeds better than is normally expected

Cont.• pessimistic time (P): the maximum possible time required to

accomplish a task, assuming everything goes wrong (but excluding major catastrophes)

• most likely time (M): the best estimate of the time required to accomplish a task, assuming everything proceeds as normal.

• expected time (TE): the best estimate of the time required to accomplish a task. Expected time is the average time the task would require if the task were repeated on a number of occasions over an extended period of time

• TE = (O + 4M + P) ÷ 6

Cont.• float or slack is a measure of the excess time and resources

available to complete a task. It is the amount of time that a project task can be delayed without causing a delay in any subsequent tasks (free float) or the whole project (total float). Positive slack would indicate ahead of schedule; negative slack would indicate behind schedule; and zero slack would indicate on schedule

• critical path: the longest possible continuous pathway taken from the initial event to the terminal event.

• critical activity: An activity that has total float equal to zero• Lead time: the time by which a predecessor event must be

completed in order to allow sufficient time for the activities that must elapse before a specific PERT event reaches completion.