UNIT 3: Developing the Project Plan

Learning Objectives
• Explain the key issues associated with project
management.
• Describe how to apply the Critical Path Method
(CPM).
• Explain how to make time/cost tradeoff
decisions in projects.
1–2
Understand the following terms:
1–3

• Network * Activities critical path
• Event *critical
  activities
• Critical Path
  4
  Network Diagrams
  • Network diagrams are the preferred
  technique for showing activity sequencing.
  • A network diagram is a schematic display
  of the logical relationships among, or
  sequencing of, project activities.
  • Two main formats are the arrow and
  precedence diagramming methods.
  Network Diagrams
  Activity-on-Arrow (AOA) networks
  – also called Arrow Diagramming Method (ADM)
  – Uses an arrow to depict an activity
  – simpler for projects with many dependencies
  – emphasizes events; milestones can be easily flagged
  – sometimes requires dummy activities
  Activity-on-Node (AON) networks
  – also called Precedence Diagramming Method (PDM)
  – Uses a node to depict an activity
  – easier to draw for simple projects
  – emphasizes activities
  – no dummy activities
  6–6
  Constructing a Project Network
  • Terminology
  – Event: a point in time when an activity is started
  or completed. It does not consume time.
  – Activity: an element of the project that requires
  time.
  – Merge Activity: an activity that has two or more
  preceding activities on which it depends.
  – Parallel (Concurrent) Activities: Activities that can
  occur independently and, if desired,
  not at the same time.
  6–7
  Constructing a Project Network
  • Terminology
  – Path: any route along the network from start to finish
  – Critical path: the longest path through the activity
  network that allows for the completion of all projectrelated
  activities; the shortest expected time in which
  the entire project can be completed. Delays on the
  critical path will delay the completion of the entire
  project.
  (Assumes that minimum of A + B > minimum of C in
  length of times to complete activities.)
  3 4
  5
  2
  6
  A B
  C
  D
  Situations in network diagram AON
  2–8
  Situations in network diagram AOA
  A
  B
  C
  A must finish before either B or C can start
  A
  B
  C both A and B must finish before C can start
  D
  C
  B
  A
  both A and B must finish before either of C or D can
  start
  A
  C
  B
  D
  Dummy
  A must finish before B can start
  both A and C must finish before D can start
  2–9
  A Comparison of AON and AOA Network
  Conventions
  Activity on Activity Activity on
  Node (AON) Meaning Arrow (AOA)
  A comes before
  B, which comes
  before C
  (a) A B C
  A B C
  A and B must both
  be completed
  before C can start
  (b)
  A
  C
  B C
  A
  B
  B and C cannot
  begin until A is
  completed
  (c)
  B
  A
  C
  A
  B
  C
  A Comparison of AON and AOA Network
  Conventions
  Activity on Activity Activity on
  Node (AON) Meaning Arrow (AOA)
  C and D cannot
  begin until A
  and B have
  both been
  completed
  (d)
  A
  B
  C
  D B
  A C
  D
  C cannot begin
  until both A and B
  are completed; D
  cannot begin until
  B is completed. A
  dummy activity is
  introduced in AOA
  (e)
  A C
  B D
  Dummy activity
  A
  B
  C
  D
  A Comparison of AON and AOA Network
  Conventions
  Activity on Activity Activity on
  Node (AON) Meaning Arrow (AOA)
  B and C cannot
  begin until A is
  completed. D
  cannot begin
  until both B and
  C are completed.
  A dummy
  activity is again
  introduced in
  AOA.
  (f)
  A
  C
  B D A B
  C
  D
  Dummy
  activity
  darla/smbs/vit 13
  AOA Project Network for House
  A
  2 0
  C
  3
  E F
  1 1 2 4 6 7
  3
  5
  Lay
  foundation
  Design house
  and obtain
  financing
  Order and
  receive
  materials
  Dummy
  Finish
  work
  Select
  carpet
  Select
  paint
  Build
  house
  AON Project Network for House
  A3 B2
  D3
  C1
  E1
  F
  1
  G1
  Start
  Design house
  and obtain
  financing
  Order and receive
  materials Select paint
  Select carpet
  Lay foundations Build house
  Finish work
  2–13
  3
  B
  1
  D
  1
  1
  G
  Constructing a Project Network:
  Table 3-1 A Sample Set of Project Activities and
  Precedence’s Activities
  2–14
  Activity Predecessor
  a —
  b —
  c a
  d b
  e b
  f c, d
  g e
  Constructing a Project Network:
  Figure 3-1 Stage 1 of a Sample AON Network
  2–15
  Constructing a Project Network:
  Figure 3-2 Stage 2 of a Sample AON Network
  2–16
  Constructing a Project Network: Figure 3-3 A
  Completed Sample AON Network
  2–17
  Critical Path Method (CPM)
  Critical Path – path with the longest total duration
  This is the shortest time in which the project can
  be completed.
  Critical Activity – an activity on the critical path
  *If a critical activity is delayed, the entire
  project will be
  delayed. Close attention must be given to
  critical activities
  to prevent project delay. There may be
  more than one
  critical path.
  Critical Path Method (CPM)
  Practical approach to finding critical path:

1. identify all possible paths from start to finish
2. sum up durations for each path
3. largest total indicates critical path
   (This approach is inefficient, but is instructive)

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