The document discusses topics related to project management including the project life cycle, project planning techniques, and network scheduling methods. It defines key project management terms and outlines the phases of a typical project life cycle. It also describes tools and techniques for project planning including the work breakdown structure (WBS), Gantt charts, and network scheduling methods like critical path method (CPM) and program evaluation and review technique (PERT).

1.  Topics to be covered
 Project
 Project Management
 Project Life Cycle
 Project Planning
 WBS
 Gantt Chart
 Network Scheduling
 CPM
 PERT
 Project Crashing
1

2.  Project :- Temporary endeavor undertaken to create a
unique product, service, or result.
 A project ends when its objectives have been reached, or
the project has been terminated.
 Projects can be large or small and take a short or long time
to complete.
2
Project

3. Project
 A sequence of unique, complex and connected activities:
 Having one goal or purpose with
 Unique scope of work and
 That must be completed by:
 A specific time,
 Within budget, and
 According to specification.
3

4. Project
Example:
 Organizational Project ( Building Construction, Launching
a new product).
 National Project (Great Renaissance Dam project, Gilgel
Gibe, Awash-Amertnesh, Rail Way Projects and etc.)
 Developing military weapons systems, aircrafts, new ships.
 Developing and implementing new processing systems.
 Developing and Installing new Chemical factory and
improving the existing one.
4

5. Project Management
 Project management is the application of knowledge, skills, tools
and techniques to project activities, in order to meet project
requirements and meet or exceed stakeholder needs and
expectations from a project which tries to balance competing
demands for project scope, time, cost, quality and resources.
 Is accomplished through the application and integration of the
project management processes of initiating, planning, executing,
monitoring and controlling, and closing.
5

6. Project Management
 A method for organizing tasks.
 Tools to aid in task sequencing, dependency analysis,
resource allocation, scheduling, etc.
 Tools to track progress relative to plan.
6
 Why Project management?
 Complex project needs coordination of:
 Multiple people and resources
 Multiple tasks – some must precede others
 Multiple decision points – approvals
 Phased expenditure of funds
 Matching of people/resources to tasks

7. Project Management
7
Scope/Quality
Resources
 The triple constraint of Project management:
 Scope goals: What work will be done?
 Time goals: How long should it take to complete?
 Cost goals: What should it cost?
 It is the project manager’s duty to balance
these three often-competing goals.

8. Project Life Cycle
 Projects will generally be sub-divided into several stages or
phases to provide better management control.
 Each project phase is marked by completion of one or more
deliverables.
 A deliverable is a tangible, verifiable work product (such as
feasibility study, a detail design or working prototype).
 Collectively, these project phases are called the Project Life Cycle.
8

9. Phases of Project
1. Scoping the project
 State the problem/opportunity.
 Establish the project goal.
 Define the project objectives.
 Identify the success criteria.
 List assumptions, risks,
obstacles.
2. Planning the project
 Identify project activity.
 Estimate activity duration.
 Determine resource requirements.
 Construct/ analyze the project
network.
 Prepare the project proposal.
9

10. Phases of Project
3. Launching plan
 Recruit and organize project team.
 Establish team operating rules.
 Level project resources.
 Schedule work packages.
 Document work packages
4. Monitoring progress
 Establish progress reporting system
 Install change control tools/process.
 Monitor project progress versus plan.
 Revise project plans.
 Obtain client acceptance.
 Install project deliverables.
 Complete project documentation.
 Complete post-implementation audit .
 Issue final project report.
5. Project Closing
10

11. Project Management
Project management tools and techniques assist project
managers and their teams in various aspects of project
management.
Specific tools and techniques include:
 Project charters, scope statements, and WBS (scope).
 Gantt charts, network diagrams, critical path analyses,
critical chain scheduling (time).
 Cost estimates and earned value management (cost).
11

12. Project Planning
12

13. Project Planning
 Planning prescribes the path to be followed in executing the
project, whereas the controls are the means to collect,
analyze, compare and correct.
 Project planning addresses work to be accomplished during
a project to meet the defined goals and objectives.
 It also identifies those activities and strategies that are
detrimental to a project’s successful completion.
13

14. Work Breakdown Structure
 A work breakdown structure defines the hierarchy of project
tasks, subtasks, and work packages.
 A method of breaking down a project into individual
elements (components, subcomponents, and tasks) in a
hierarchical structure which can be scheduled.
 It defines tasks that can be completed independently of
other tasks, facilitating resource allocation, assignment of
responsibilities and measurement and control of the project.
 It can be used to identify the tasks in the CPM and PERT.
14

15. Work Breakdown Structure
15
Program
Project 1 Project 2
Task 1.1
Subtask 1.1.1
Work Package 1.1.1.1
Level
1
2
3
4
Task 1.2
Subtask 1.1.2
Work Package 1.1.1.2

16. Work Breakdown Structure
16

17. Project Scheduling Techniques
 Schedules show the timing for work elements and when specific
events and project milestones should take place.
 Project Scheduling Involves :
 Estimating how long they will take;
 Allocating resources (mainly personnel);
 Scheduling when the tasks will occur.
 Project scheduling benefits:
 Lowers chance of delay and assists in recovering from delay,
 A good communication tool, between the managers, the owners,
investors, and the general public.
17

18. Project Scheduling Techniques
 Project scheduling systems
 Network scheduling
 CPM (Critical Path Method)
 PERT (Program Review and Evaluation Techniques)
 Gantt Chart
18

19. Project Scheduling Techniques
Network Scheduling
 Network scheduling is a diagram which represents all
the events and activities in sequence (in which they are
required to be performed to complete the project), along
with their interrelationships and interdependencies.
19

20. Project Scheduling Techniques
 Terms related to network planning methods:
 Event: An event is a specific instant of time which
marks the start and the end of an activity.
 Event consumes neither time nor resources.
 It is represented by a circle and the event number is
written with in the circle. Event and node are
synonyms.
 Milestones: events that mark significant progress.
20

21. Network Scheduling
 Activity: Every project consists of a number of operations
or tasks which are called activities.
 An activity is an element of project and it may be a
process, a material handling or material procurement
cycle, etc.
 Unlike event, an activity consumes time and resources. An
activity may be performed by an individual or a group of
individuals.
 An activity is normally given a name like, A, B, etc.
21

22. Network Scheduling
 Building Activity Network:
 Define activities from WBS work packages
 Estimate duration and resources for each activity
 Define precedence relationships between activities
 Network Representation Schemes
 AON Network [Activity-on-Node]
 AOA Network [ Activity-on- Arrow]
22

23. Network Scheduling
 Critical activities: Are those activities which if they consume more
than their estimated time, the project will be delayed.
 Non-critical activities: Such activities have provision (float or
slack) so that, even if they consume a specified time over and above
the estimated time, the project will not be delayed.
 Dummy activities: When two activities start at the same instant of
time, the head events are joined by a dotted arrow and this is known
as a dummy activity. A dummy activity is assumed to take nil time,
but it facilitates the drawing of the arrow diagram subject to the
precedence constraints, by avoiding redundancy.
23

24. Building Activity Network
 AOA
 Nodes represent start and finish events for each activity, and
arrow represent an activity and precedence.
 Arrows can only come from/go to single node.
 Only one arrow between two given nodes.
 A dummy activity is used to illustrate precedence relationships
in AOA networks.
24

25. Building Activity Network
25
 Example: Consider the following activities
 Example: Consider the following projects

26. Building Activity Network
26
 Activity on Node (AON)
 The node (the block in the figure) is the activity; inside the
node is information about the activity, such as its duration,
start time, and finish time.
 Arrow indicates the precedence or dependencies.
 Requires no dummy nodes.

27. Building Activity Network
27
 Activity on Arrow and Activity on Node

28. Critical Path Method (CPM)
 CPM is a technique used for planning and controlling the most
logical and economic sequence of operations for accomplishing a
project.
 The project is analyzed into different activities whose relationships
are shown on the network diagram. The network is then utilized for
optimizing the use of resources, progress and control.
 CPM
 Used when activity times are known with certainty.
 Used to determine timing estimates for the project, each activity
in the project, and slack time for activities.
28

29. Critical Path Method (CPM)
 Path: A connected sequence of activities leading from the
starting event to the ending event.
 Critical Path: The longest path (time); determines the
project duration.
 Critical Activities: All of the activities that make up the
critical path.
 Forward pass
 Earliest Start Time (ES): Earliest time an activity can
start.
 ES = maximum EF of immediate predecessors.
 Earliest finish time (EF): Earliest time an activity can
finish, earliest start time plus activity time.
 EF = ES + t, where t is activity time.
29

30. Critical Path Method (CPM)
Backward pass
 Latest Start Time (LS): Latest time an activity can
start without delaying critical path time.
 LS = LF - t
 Latest finish time (LF): Latest time an activity can be
completed without delaying critical path time.
 LF = minimum LS of immediate successors.
 Float (Slack): Maximum amount of time that an
activity can be delayed in its completion before it
becomes a critical activity, i.e., delays completion of the
project.
 Float = LS - ES = LF – EF
30

31. CPM Analysis
 Break down the project into various activities systematically (WBS).
 Label and arrange all the activities in logical sequence.
 Construct the network diagram and number all the nodes (events)
and activities.
 Find the time for each activity.
 Mark the activity times on the arrow (if AOA) and in node if (AON).
 Calculate early and late start and finishing times.
 Identify the critical activities, the sequence of activities and events
where there is no “slack” i.e.. Zero slack.
31

32. CPM
 Consider the following consulting project: Develop a critical path
diagram and determine the duration of the critical path and slack
times for all activities.
32
Activity Designation Immed. Pred. Time (Weeks)
Assess customer's need A None 2
Write and submit proposal B A 1
Obtain approval C B 1
Develop service vision and goals D C 2
Train employees E C 5
Quality improvement pilot groups F D,E 5
Write assessment report G F 1
 Start by constructing the Network diagram (AON)
 For earliest time – Forward pass analysis
 For latest time – Backward pass analysis

33. CPM
Activity Time ES EF LF LS Float
A 2 0 2 2 0 0
B 1 2 3 3 2 0
C 1 3 4 4 3 0
D 2 4 6 9 7 3
E 5 4 9 9 4 0
F 5 9 14 14 9 0
G 1 14 15 15 14 0
Critical path:
A – B – C – E – F – G
Duration=15 weeks
 Activity D can be delayed by 3 days without affecting the completion
time of the project.

34. Program Evaluation and Review Techniques (PERT)
 PERT is based on the assumption that an activity’s duration
follows a probability distribution instead of being a single value,
Because of the uncertainty of activity timings.
 The statistical probability feature of PERT foretells the probability
of reaching the specified target date.
 Three time estimates are required to compute the parameters of
an activity’s duration distribution:
 Pessimistic time (tp) - the time the activity would take if
things did not go well.
 Most likely time (tm) - the consensus best estimate of the
activity’s duration.
 Optimistic time (to) - the time the activity would take if
things did go well.
34

35. Program Evaluation and Review Techniques (PERT)
 The fundamental assumption in PERT is that the three
time estimates form the end points and mode of Beta
distribution. It is further assumed that to and tp are
about equally likely to occur whereas the probability of
occurrence of tm is 4 times that of tp or to.
Expected time: Te =
tp + 4 tm + to
6
Variance: Vt =σ 2 =
tp - to
6
2
35

36. Program Review and Evaluation Techniques (PERT)
36

37. PERT Analysis
 Arrange activities in logical sequence and draw network diagram.
 Using three-time estimate, calculate expected time for each activity
 Calculate standard deviation and variance for each activity.
 Determine earliest starting times and latest finishing times.
 Identify Critical path(s) and total project duration.
 Lastly, calculate the probability that the project will finish at due date.
Z =
x - 

where  = Te = project mean time
 = project time standard deviation
x = (proposed ) specified time
37

38. PERT Networking Example
Task
Immediate
Predecesors Optimistic Most Likely Pessimistic
A None 3 6 15
B None 2 4 14
C A 6 12 30
D A 2 5 8
E C 5 11 17
F D 3 6 15
G B 3 9 27
H E,F 1 4 7
I G,H 4 19 28
Expected Time =
Opt. Time + 4(Most Likely Time) + Pess. Time
6
 Consider the following tasks from A to I and find the critical
path, longest path on the network.
38

39. PERT Example Solution
Task
Immediate
Predecesors
Expected
Time
A None 7
B None 5.333
C A 14
D A 5
E C 11
F D 7
G B 11
H E,F 4
I G,H 18
Te(A)= 3+4(6)+15
6
A(7)
B
(5.333)
C(14)
D(5)
E(11)
F(7)
H(4)
G(11)
I(18) Duration = 54 Days
Te(B)= 2+4(4)+14
6
Te(C)= 6+4(12)+30
6
ET(A)=42/6=7
ET(B)=32/6=5.333
ET(C)=84/6=14
39
Critical path:
A – C – E – H – I

40. Activity variance, = (
Pessim. - Optim.
6
)
2 2

Task Optimistic Most Likely Pessimistic Variance
A 3 6 15 4
B 2 4 14
C 6 12 30 16
D 2 5 8
E 5 11 17 4
F 3 6 15
G 3 9 27
H 1 4 7 1
I 4 19 28 16
(Sum the variance along the critical path.)  2
 = 41
Probability Exercise
 What is the probability of finishing this project in less than 53
days?
40

41. There is a 43.8% probability that this project will be completed in
less than 53 weeks.
p(Z < -.156) = .438, or 43.8 %
.156
-
=
41
54
-
53
=
T
-
X
=
Z
2
cp
E

TE = 54
p(t < D)
t
D=53
Probability Exercise Solutions
41
Refer Z table

42. Probability Exercise Solution
t
TE = 54
p(t <X)
X=56
.312
=
41
54
-
56
=
T
-
X
=
Z
2
cp
E

p(Z > .312) = .378, or 37.8 %
 What is the probability that the project duration will exceed 56
weeks?
42

43. Project Scheduling Techniques
Gantt Chart
 The Gantt chart is the oldest compared to network
diagrams and is used effectively in simple, short-duration
types of projects.
 Graph or bar chart with a bar for each project activity that
shows passage of time.
 Provides a visual display of project schedule.
 Vertical axis shows tasks and horizontal shows duration for
each activity.
43

44. Project Scheduling Tools and Techniques
 Gantt Chart
44

45. Project Scheduling Techniques
Gantt Chart Characteristics:
 The horizontal position of the bar identifies start and end
times of the task
 Bar length represents the duration of the task
 Critical activities are usually highlighted
 Slack times are represented using bars with doted lines
 The bar of each activity begins at the activity earliest start
time (ES)
 The bar of each activity ends at the activity latest finish
time (LF).
45

46. Project Scheduling Tools and Techniques
 Steps of constructing Gantt chart
 Plot critical activities first
 Place windows for non critical activities
 Schedule the non critical activities
 Place the precedence arrow
 Example: Construct Gantt chart for the following
46
Activity Time Imm. predecessor
A 2 ----
B 4 ---
C 1 A
D 3 B
E 5 C,D

47. Project Scheduling Tools and Techniques
 Gantt Chart
47
Activity Time ES EF LF LS Float
A 2 0 2 6 4 4
B 4 0 4 4 0 0
C 1 2 3 7 6 4
D 3 4 7 7 4 0
E 5 7 12 12 7 0
Activity 1 2 3 4 5 6 7 8 9 10 11 12
A
B
C
D
E
Time in days

48. 48
 Projects will sometimes have deadlines that are impossible
to meet using normal procedures
 By using exceptional methods it may be possible to finish
the project in less time than normally required.
 However, this usually increases the cost of the project.
 Reducing a project’s completion time is called crashing.
Project Crashing

49. 49
 Crashing a project starts with using the normal time to create
the critical path.
 Notations:
 NT = normal time to complete an activity
 NC = normal cost to complete an activity using normal
procedures
 CT = crash time to complete an activity, the shortest
possible activity time and will require additional resources
 CC= Crash cost (the cost to complete the activity if it is
performed in it’s shortest possible time)
Project Crashing

50. 50
 Steps of crashing project:
1. Find the normal critical path and identify the critical activities.
2. Compute the crash cost per week (or other time period) for all
activities in the network using the formula.
3. Select the activity on the critical path with the smallest crash
cost per period and crash this activity to the maximum extent
possible or to the point at which your desired deadline has been
reached.
4. Check that the critical path you were crashing is still critical. If
the critical path is still the longest path through the network,
return to step 3. If not, find the new critical path and return to
step 3 .
Crash cost/Time period = Crash cost – Normal cost
Normal time – Crash time
Project Crashing

51. 51
 Computing crash data
 Given:
 Activities
 Normal time
 Normal cost
 Crash time
 Crash cost
 Compute:
 Maximum time reduction
 Cost to crash per period
Project Crashing

52. 52
 This project, under normal conditions takes 20 days.
Suppose each day the project runs incurs an indirect
project cost of $1400 (overhead). What activities
should be crashed if any?
Project Crashing
Activity Time Predecessor
A 7 --
B 3 A
C 4 A
D 8 B, C
E 9 C

53. 53
 Example (...contd)
Activity NT NC CT CC Max.
Red
Cost to crash per
period
A 7 3000 4 6000 3 1000
B 3 4000 2 5500 1 1500
C 4 15000 2 20000 2 2500
D 8 10000 5 19000 3 3000
E 9 7000 6 9100 3 700
Project Crashing

54. 54
 Paths
 ABD =18 days
 ACD =19 days
 ACE = 20 days* [critical path]
 Start by looking at activities on the critical path: A, C,
and E.
 E is least expensive to crash
Project Crashing

55. 55
 Crash test #1
 E has maximum time reduction of 3, but if it is crashed by 1,
then ACD also becomes a critical path.
 By crashing activity E by one day, we save $1400 per day the
project is shortened and would spend $700 per day to crash E, so
it is profitable to crash E.
 Crash E by 1
 ABD 18→ 18
 ACD 19 →19 *
 ACE 20 * →19 *
 Now we have two critical paths
Project Crashing

56. 56
 Crash test #2
 Crash Options:
 A or C
 Crash D and E together
 Cost to crash
 Cost to crash A = 1000/day
 Cost to crash C = 2500/day
 Cost to crash both D and E = 3700 [ each by single day]
 Best is to crash A. How much should it be crashed?
Project Crashing

57. 57
 E crashed by 1 (already) and crash A by 3 [Maximum
reduction for A is 3]
 When A is crashed, all paths are affected, so no new paths
will become critical.
 Cost savings remain at $1400 vs $1000 cost to crash.
 Activity E is crashed by 1day and activity A by 3 days:
 ABD 18→ 18→ 15
 ACD 19 →19 *→ 16 *
 ACE 20 *→ 19 * →16 *
Project Crashing

58. 58
 Stopping condition
 To continue, we could crash C or both D and E together. But in each
case, the cost would be greater than the $1400 savings per day. So, we
stop at this point.
 We can compute the cost to perform the project in 16 days.
 Sum of normal costs = 39,000 = [3000+4000+15000+ 10000+ 7000]
 Indirect costs(Overhead) = 16 dys * 1400 = 22,400
 Crashing cost
 E by 1day = 700
 A by 3 days = 3000
 Total cost = 39,000 + 22400 + 700 +3000=$65,100
Project Crashing

59. Quiz - 2
Activity Time (weeks) Predecessors
A 3 --
B 4 --
C 5 A
D 7 B
E 2 B
F 4 E
G 3 C,D
59
 Consider the following activities of a project
a) Construct network diagram using both AOA andAON representations
b) Determine critical activities and total project duration
c) Determine earliest time, latest time and float for each activity.

60. CPM Exercise
Activity Immed. Predec. Most Likely Time (Hr.)
A --- 6
B --- 5
C A 3
D A 5
E A 1
F B, C 4
G B, C 2
H E, F 6
I E, F 5
J D, H 3
K G, I 5
 For the above activity:
 Determine the critical path and duration.
 Determine ES and EF for each activity.
 Determine LS and LF for each activity.
 Determine float or slack for each activity.
60

61. PERT Exercise
Activity
Immed.
Predec.
Optimistic
Time (Hr.)
Most Likely
Time (Hr.)
Pessimistic
Time (Hr.)
A --- 4 6 8
B --- 1 4.5 5
C A 3 3 3
D A 4 5 6
E A 0.5 1 1.5
F B, C 3 4 5
G B, C 1 1.5 5
H E, F 5 6 7
I E, F 2 5 8
J D, H 2.5 2.75 4.5
K G, I 3 5 7
 For the above activity:
 Determine the expected time of each activity.
 Determine the critical path and duration.
 Determine the probability of completing the project with less than
24 hrs.
 Determine the probability of completing the project with in 20 hrs. 61