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Chapter 3
Project Planning and Control
Definition of Project Management
Work Breakdown Structure
Project Control
Organizational Structures Not Discussed Here
Critical Path Scheduling
CPM with a Single Time
CPM with Three Activity Time Estimates
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Project Management
Project
Lengthy network of activities needed to complete a
major output.
Project Management
Planning, execution, and controlling resources to
needed to complete the project.

Project or Program?
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Work Breakdown Structure
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
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Project Control: Gantt Chart
Activity 1
Activity 2
Activity 3
Activity 4
Activity 5
Activity 6
Time
(See Exhibit 3.2 for other project control reporting tools)
a
b
a
b
c
c
d
d
d
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PERT and CPM
PERT (program evaluation and review
technique)
U.S. Navy Special Projects Office (1958)
Polaris missile project
CPM (critical path method)
J. E. Kelly of Remington-Rand and M. R. Walker of
Du Pont (1957)
Scheduling maintenance shutdowns of chemical
processing plants
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Critical Path Scheduling
A project must have:
well-defined transformations/activities
whose completion marks the end of the
project;
independent and sequential
transformations/activities.
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CPM with Single Time Estimate
Consider the following consulting project:
Develop a critical path diagram and determine the
duration of the critical path and slack times for all
activities
Activity Designation Immed. Pred. Time (Weeks)
Assess customer's needs 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 16
Write assessment report G F 1
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First draw the network
A, 2 B, 1 C, 1
D, 2
E, 5
F, 5
G, 1
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Determine early start and early finish times
ES=0
EF=2
ES=2
EF=3
ES=3
EF=4
ES=4
EF=9
ES=4
EF=6
?
A, 2 B, 1 C, 1
D, 2
E, 5
F, 5
G, 1
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When I can start depends on when
predecessors finish.
ES=9
EF=14
ES=14
EF=15
ES=0
EF=2
ES=2
EF=3
ES=3
EF=4
ES=4
EF=9
ES=4
EF=6
A, 2 B, 1 C, 1
D, 2
E, 5
F, 5
G, 1
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Determine late starts and late finish times
ES=9
EF=14
ES=14
EF=15
ES=0
EF=2
ES=2
EF=3
ES=3
EF=4
ES=4
EF=9
ES=4
EF=6
A, 2 B, 1 C, 1
D, 2
E, 5
F, 5
G, 1
LS=14
LF=15
LS=9
LF=14
LS=4
LF=9
LS=7
LF=9
?
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Dont delay the project
ES=9
EF=14
ES=14
EF=15
ES=0
EF=2
ES=2
EF=3
ES=3
EF=4
ES=4
EF=9
ES=4
EF=6
A, 2 B, 1 C, 1
D, 2
E, 5
F, 5
G, 1
LS=14
LF=15
LS=9
LF=14
LS=4
LF=9
LS=7
LF=9
LS=3
LF=4
LS=2
LF=3
LS=0
LF=2
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Critical Path & Slack
ES=9
EF=14
ES=14
EF=15
ES=0
EF=2
ES=2
EF=3
ES=3
EF=4
ES=4
EF=9
ES=4
EF=6
A, 2 B, 1 C, 1
D, 2
E, 5
F, 5
G, 1
LS=14
LF=15
LS=9
LF=14
LS=4
LF=9
LS=7
LF=9
LS=3
LF=4
LS=2
LF=3
LS=0
LF=2
Duration = 15 weeks
Slack=(7-4)=(9-6)= 3 Wks
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CPM with Three Activity Time Estimates
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
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Expected Times
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
Expected Time =
Opt. Time + 4(Most Likely Time) + Pess. Time
6
A, 7
B
5.333
C, 14
D, 5
E, 11
F, 7
H, 4
G, 11
I , 18
Duration = 54 Days
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What is the probability of finishing this project in
less than 53 days?
t
T
E
= 54
p(t < D)
D=53
Z =
D - T
E
cp
2

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Activity variance, = (
Pessim. - Optim.
6
)
2 2

(Sum the variance along the critical path.)

2

= 41
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
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t
T
E
= 54
D=53
Z =
D - T
=
53- 54
41
= -.156
E
cp
2

p(t < D)
p(Z < -.156) = .5 - .0636 = .436, or 43.6 % (Appendix D)
There is a 43.6% probability that this project will be
completed in less than 53 weeks.
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Exercise
What is the probability that the project duration
will exceed 56 weeks?
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Exercise Solution
t
T
E
= 54
p(t < D)
D=56
Z =
D - T
=
56 - 54
41
= .312
E
cp
2

p(Z < -.156) = .5 - .1217 = .378, or 37.8 % (Appendix D)

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Time-Cost Models
Basic Assumption: Relationship between activity
completion time and project cost


Time Cost Models: Determine the optimum
point in time-cost tradeoffs
Activity direct costs
Project indirect costs
Activity completion times
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Some CPM/PERT Assumptions
Project activities can be identified as entities.
(There is a clear beginning and ending point for
each activity.)
Project activity sequence relationships can be
specified and networked
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Some CPM/PERT Assumptions
Project control should focus on the critical path.
The activity times in PERT follow the beta
distribution, with the variance of the project
assumed to equal the sum of the variances along
the critical path.