14 Project Formulation and Management Techniques – Networks
Dr. Sasidhar
18.1 OBJECTIVES
After studying this unit you should be able to:
- Describe the networks as a project management technique.
- Draw and analyze a project network
18.2 INTRODUCTION
In this module networks, their terminology, rules for preparation of networks and their uses with examples are discussed for your understanding. To overcome the shortcomings in Gantt and Milestone charts, the networks are developed. The network is a logical extension of Milestone chart incorporating interrelationship between and among all the milestones in project.
18.3 NETWORKS
Two widely used techniques for network analysis are:
- Programme Evaluation and Review Technique (PERT)
- Critical Path Method (CPM).
The costs for various activities of the project / programme are introduced by CPM. While it does not mean that PERT deliberately omits the costs, one has to assume that costs vary with the time. For a particular project / programme, if time is reduced by 4 weeks, it implies that some money also saved. When time requirement for each activity is estimated accurately, then CPM is more appropriate and relevant. On the other hand, if accurate time estimation is difficult for each activity and need to overcome this uncertainty, then the PERT is the best choice.
When each activity is associated with the costs, application of CPM is more appropriate. For research projects, time is more important compared to costs because of uncertainty, then PERT is more useful. Let us discuss more about network terminology, network preparation rules and analysis of networks in the subsequent sections.
18.4 NETWORKS TERMINOLOGY
The commonly used terms in the networks are given below for your understanding.
Activity: Is the actual performance of a task which consumes time, requires resources, and it can be understood as representing the time, effort, and resources required to move from one event to another. Activity is represented by an arrow(→) . Every activity lies between events.
arrow ( →). Every
Example: Interview schedule preparation, data collection.
Dummy activity: An activity that indicates precedence relationship and requires neither time nor resource. It is usually represented by a broken arrow (→)
Event: Event is a point that marks the start or completion of one or more tasks. Event is usually denoted by a circle which is divided into two equal halves. The left half is meant for event number. The right half is further divided into two segments, the top representing Earliest Starting Time (EST) and the bottom Latest Starting Time (LST) (Fig.18.1).
Example: Interview schedule preparation completed, data collection started.
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 events intervening.
Burst event: An event which gives rise to more than one activity.
Merge event: The event which occurs only when more than one activity are accomplished.
Earliest Start Time (EST): The earliest possible time at which the event can occur. The EST of an activity is the time before which it cannot commence without affecting the immediate preceding activity.
Latest Start Time (LST): The latest time at which the event can take place. It indicates the latest time at which an activity can begin without delaying the project completion time.
Critical Events: These are events which fall on the critical path. Every critical event will have the same EST and LST.
Critical Path: The longest possible continuous pathway taken from the initial event to the terminal event. Any time delays along the critical path will delay the reaching of the terminal event by at least the same amount.
Critical Activity: An activity that has total float equal to zero.
Optimistic time (To): The minimum possible time required to accomplish a task, assuming everything proceeds better than is normally expected.
Pessimistic time (Po): The maximum possible time required to accomplish a task, assuming everything goes wrong (but excluding major catastrophes).
Most likely time (TM): 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, assuming everything proceeds as normal (the implication being that the 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 = (To + 4 TM + Po) ÷ 6
Float or Slack: Is the amount of time that a task in a project network can be delayed without causing a delay in subsequent tasks (free float) or project completion (total float).
Event Slack: It is the slack time associated with an event. ES = LST – EST
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 is reached to be completed.
Lag time: The earliest time by which a successor event can follow a specific PERT event.
Fast tracking: Performing more critical activities in parallel
Crashing critical path: Shortening duration of critical activities
Activity Table: Table developed after breaking the project into activities indicating their symbols, time requirement and logical relationships (preceding and succeeding activities).
Danglers: Loosely attached activities. They may end abruptly without any succeeding activity / activities.
Normal Time: This is the time required when activities are performed in normal way. It is usually the longest time for the project and entails money saving is there.
18.5 RULES FOR PREPARATION OF NETWORKS
For your easy understanding, some basic rules for preparing networks are described below with diagrams.
- Activity is indicated by an arrow which is drawn from left to right. Neither the orientation of arrow nor its length has any significance. Every activity starts and ends with an event ( Fig. 18.2)
- Any number of activities may emerge out from an event. This event is named as burst event ( Fig. 18.3).
- Any number of activities may merge with an event ( Fig 18.4)
- When two or more activities have to be completed before the next event occurs, they should not be represented as merged activities as shown in (a), which is wrong. This can be represented as sequential activity by introducing the dummy activity as shown in (b) ( Fig 18.5).
The network of the project is given in Fig.18.6 with dummies between B &D; C & D; F&G and E & K. The dummies are represented as Z1, Z2, Z3, and Z4 and so on.
It is preferable to use D.R. Fulkerson’s rules to give numbering as indicated below.
- The initial event should be started with 1.
- Eliminate all activities emerging out from event number 1 and give number 2 to the succeeding event. If two or more events occur concurrently after the first event, give 2,3,4 and so on for succeeding events.
- Delete all the activities emerging out from 2,3, 4 events and so on and give the new event numbers 5,6,7 and son on.
- Continue this process till the entire network is completed.
This process is continued till the entire network with event numbers is completed ( Fig 18.7).
- An event will occur only after all the activities merging into it are completed. Event numbers are shown in the left half of the circle and the EST and LST on the right half.
- After drawing the network, the time requirement for each activity is indicated.
18.6 NETWORK PREPARATION
Following steps are useful in preparing networks.
Step 1 : Write down the specific objectives of the project.
Step 2 : Based on the objectives, write technical programme details.
Step 3 : Break the technical programme into specific activities.
Step 4 : List out all the activities showing the preceding and succeeding relationships.
Step 5 : Give symbols for activities with capital letters i.e. A,B,C,D,E and so on
Step 6 : Calculate the expected time by using the following equation.
Expected Time TE = (To + 4 TM + Po) ÷ 6
Where,
- To is the Optimistic time,(minimum time assuming everything goes well)
- TM is the Most likely time, (modal time required under normal circumstances)
- TP is the Pessimistic time, (maximum time assuming everything goes wrong)
Step 7: Draw the flow chart as it helps in preparing the network
Step 8 : Draw the network by following the rules for preparation of networks as discussed in the previous section.
Step 9: Write the event numbers, EST and LST. By using forward pass (start to end) and backward pass (end to start), the network would be analysed as follows.
Event Numbers: Give numbers to various events (see the previous section for details on numbering)
Forward Pass: (a) Consider the EST of the first activity as zero (b) Start from the first event for computation of EST. Add the activity duration to the EST of preceding event to get the EST of succeeding event. Whenever an event is competing with two or more activities, the largest value must be considered to arrive at the EST of the succeeding event. EST is the result of forward pass.
Backward Pass: (a) Consider the LST value of the last event as equal to its EST value.
- (b) In contrast to the forward pass, start from the last event and subtract the activity duration from the LST of succeeding event to arrive at the LST of the preceding event. When two or more activities are backing to an event, the smallest of these must be taken into account for the LST of preceding event. LST is the result of backward pass.
Step 10: Compute the critical path taking into account all the critical activities. This is the longest path in terms of time for accomplishing the project.
Step 11 : Calculate activity slack (total float), event slack , free float and independent float by using the following formulae
Activity slack = LST of end event – EST of starting event – Duration of reference activity
Event slack = LST of event – EST of event
Free float = EST of end event –EST of starting event – Duration of reference activity
Independent float = EST of end event – LST of starting event – Duration of reference activity
Step 12: Establish job boundary limits for all the activities which include duration of activity, event number, EST, LST, EFT, LFT, event slack, total float, free float and independent float.
18.7 NETWORK EXAMPLE
Let us assume that as a development worker, you are asked to complete a ‘Garden Development Project’ by a Municipality with seven project activities (Table 18.2). The network diagram is prepared for your easy understanding (Source: Venkateswarlu and Raman, 1993).
Table 18.2: Time duration estimates of activities
The network after computation of EST and LST are given in Fig.18. 8
The analysis of the results of the network is given in Table 18.3 for your understanding
Critical path is the longest path for project accomplishment. In the above example the critical path of the project is A-B-E-G ( 9+4+10+2) = 25 weeks
Uses of Networks
The important uses of networks are:
- Planning and scheduling of project activities
- Guidance, supervision of activities and organizing resources – personnel, money, time and material.
- Monitoring and controlling of project activities.
- Communication on costs and time in a concise manner.
- Responsibility and teamwork.
- Training, minimizing conflicts and performance appraisal.
18.8 LET US SUM UP
In this unit we started by looking into the meaning of Networks namely PERT and CPM , important differences and their application in project management. We also discussed the networks terminology and rules for preparation of networks. Later we discussed the network preparation, analysis and uses with examples and diagrams.
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18.9 KEYWORDS
Activity: Actual performance of a task.
CPM: Mathematically based algorithm for scheduling a set of project activities.
Critical Activity: Activity that has total float equal to zero.
Critical Events: Events which fall on the critical path which will have the same EST and LST.
Critical Path: Longest possible continuous pathway taken from the initial event to the terminal event.
Event: Event is a point that marks the start or completion of one or more tasks.
Float or Slack: Amount of time that a task in a project network can be delayed without causing a delay in subsequent tasks (free float) or project completion (total float).
Network: Network is a logical extension of bar charts incorporating interrelationship between and among all the milestones in project.
PERT: Is a project management model designed to analyze and represent the tasks involved in completing a project.