Chapter 8

SCHEDULING RESOURCES AND COSTS

Review Questions

1. How does resource scheduling tie to project priority?

Resource scheduling ties to project priority because resources are limited.

Remember, the priority system ranks projects which then determines which project
each resource should work on first.

2. How does resource scheduling reduce flexibility in managing projects?

Resource scheduling systems usually reduce flexibility because when resources are
considered, computer routines use slack to get an “efficient” schedule. When slack is
used up, flexibility is lost and the risk of delaying the project increases. If the
resource conflict occurs on the critical path, the project is delayed.

3. Present six reasons scheduling resources is an important task.

Several reasons for scheduling resources are to:

 Check if existing resources are adequate and available

 Decide which resources have priority
 Assess the impact if another project is added to the pool
 Determine where the real critical path is. Are there unforeseen dependencies?
 See what happens to the risk of being late if slack is used up developing a
schedule
 Decide if outside contractors have to be used
 Decide if an imposed project duration is realistic.

Students should not be limited to these reasons; there are many more reasons for
scheduling resources.

4. How can outsourcing project work alleviate the three most common problems
associated with multiproject resource scheduling?

Outsourcing can be used to reduce project slippage, improve utilization of critical

resources, and avoid resource bottlenecks. For example, project delays can be
avoided by contracting key activities when resources are not available internally.
Likewise, hiring consultants to help with Y2K problems allows critical IT people to
work on specific problems, while the outsiders work on standard programs. Not only

Chapter 8 Scheduling Resources and Costs 147

 does the project get done on time, but the company avoids hiring IT personnel to meet
a short term need.

5. Explain the risks associated with leveling resources, compressing or crashing

projects, and imposed durations or “catch-up” as the project is being
implemented.

The risks associated with leveling, crashing, and “catch-up” are similar to those noted
in question 2. Flexibility is decreased and risk of delay is increased. For example,
slack is used up and may cause other bottlenecks later in a sequence of activities.
Having time buffers at merge points before the project begins could help avoid some
of the need to crash activities. Decoupling critical activities can help to cut time if
decoupling is possible and resources can be shifted; however, the risk is typically
reduced only slightly.

6. Why is it critical to develop a time-phased baseline?

Other systems do not measure how much work is accomplished for the money spent!
Hence, without time-phasing cost to match your project schedule, it is impossible to
have reliable information for control purposes.

Exercises

148 PROJECT MANAGEMENT: THE MANAGERIAL PROCESS

2. Given the network plan that follows, compute the early, late, and slack times.
What is the project duration? Using any approach you wish (e.g., trial and
error) develop a loading chart for resource resources Carpenters (C) and
Electricians (E). Assume only one Carpenter is available and two Electricians
are available. Given your resource schedule, compute the early, late, and slack
times for your project. Which activities are now critical? What is the project
duration now?

Resource constraints extend the project duration from 12 days to 14 days and Activity
2 which was part of the original critical path is no longer critical path. All other
activities are critical which illustrates the key point that resource constraints tend to
increase the sensitivity of project networks.

Chapter 8 Scheduling Resources and Costs 149

4. Develop a resource schedule in the loading chart that follows. Use the parallel
method and heuristics given. Be sure to update each period as the computer
would do. Note: Activities 2, 3, 5, and 6 use two of the resource skills. Three of
the resource skills are available.

Log of Parallel Method of Scheduling Exercise 8-4

PERIOD ACTIVITY CHANGES

0-1 2 Schedule Activity 2 (first by minimum slack rule)
1 Schedule Activity 1
1-2 - No changes
2-3 - No changes
3-4 - No changes
4-5 3 Delay ES of Activity 3 to 5. Reduce slack to 1
5-6 4 Schedule Activity 4 (minimum slack rule)
3 Schedule Activity 3
5 Delay ES of Activity 5 to 6. Reduce slack to 1
6-7 5 Delay ES of Activity 5 to 7. Reduce slack to 0
7-8 5 Delay ES of Activity 5 to 8. Reduce slack to -1
6 Delay ES of Activity 6 to 11. Reduce slack to -1
8-9 5 Delay ES of Activity 5 to 9. Reduce slack to -2
6 Delay ES of Activity 6 to 12. Reduce slack to -2
9-10 5 Schedule Activity 5
10-11 - No changes
11-12 - No changes
12-13 6 Schedule Activity 6

150 PROJECT MANAGEMENT: THE MANAGERIAL PROCESS

Chapter 8 Scheduling Resources and Costs 151
5. You have prepared the following schedule for a project in which the key resource
is a backhoe. This schedule is contingent on having 3 backhoes. You receive a
call from your partner, Brooker, who desperately needs 1 of your backhoes. You
tell Brooker you would be willing to let him have the backhoe if you are still able
to complete your project in 11 months.
Develop a resource schedule in the loading chart that follows to see if it is
possible to complete the project in 11 months with only 2 backhoes. Be sure to
record the order in which you schedule the activities using scheduling heuristics.
Activities 5 and 6 require 2 backhoes, while activities 1, 2, 3, and 4 require 1
backhoe. No splitting of activities is possible. Can you say yes to Brooker’s
request?

152 PROJECT MANAGEMENT: THE MANAGERIAL PROCESS

 8. Given the time-phased work packages and network, complete the baseline
budget form for the project.

Chapter 8 Scheduling Resources and Costs 153

 Exercise 8-8b

154 PROJECT MANAGEMENT: THE MANAGERIAL PROCESS