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Chapter 6

CGMS450- Chapter 6- Allocating Scarce Resources to Project.docx

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Ryerson University
Global Management Studies
GMS 450
Stan Katz

CGMS401-Chapter 6- Allocating Scare Resources to the Project 6.1 Expediting a Project The Critical Path Method  In traditional PERT/CPM, the rules of ―standard practice‖ apply and the normal task duration estimate is made with the normal or standard-practice resource usage. Then a second estimate, referred to as the crash duration, is made based on the resources required to expedite the task  When making estimates for crashing, it is important that the resources are available  There is a set of activities, predecessors, normal task duration estimates, crash duration estimates, and estimates for normal cost and crash cost  One crash duration is marked with a single asterisk. For this activity, the task may be carried out in normal time or crashed one day at a time.  Another activity is marked with a double asterisk – in this case, the duration must be done one or the other; cannot be broken down into segments  The ―slope‖ information for non-or-partially segmented activities is normally given in the slope chart. Activity slope is computer as follows:  Slope = crash – cost / crash time – normal time  When crashing a project, starting with the normal schedule for all project activities, crash selected activities, one at a time, to decrease project duration at the minimum additional cost.  To crash a project, follow two simple principles: 1. First focus on the critical paths when trying to shorten the duration of a project – crashing a non- critical activity will not influence project duration 2. Second, when shortening a project’s duration, select the least expensive way to do it  See diagrams and examples on page 199-201 Fast-Tracking a Project  The term refers to an expediting technique in which the design and planning phase is started.  For many projects in maintenance, construction and similar areas, a large proportion of the work is routine. In these cases, fast-tracking rarely causes serious problems. 6.2 Resource Loading  Resource loading refers to the amounts of specific resources that are scheduled for use on specific activities or projects at specific times – usually is the form of a list or table  Figure 6-3 reveals that in the first week of the project the scriptwriter is over allocated. During the first 6 days of the project this person is scheduled to work 94 hours. The scriptwriter’s first full week is over allocated by 40 hours. The producer’s first week us also over allocated at 40 hours.  Unless specified otherwise, MSP assumes that any resource assigned to an activity will work on that activity 100 % of the time available on the resource calendar.  Large project with large number and variety of resources, it might be necessary to correct this ―error‖  Resource loading is usually displayed as a list of the amounts of specific resources assigned for use on specific project activities at specific times, or as a graph showing the level of resource’s capacity required against the project calendar. To be useful for scheduling, the resource must have a calendar showing the resource’s availability.  The calendar should include hours—and days—worked each week, any holidays on which the resource will not be available, and any other information affecting the availability of the resource 6.3 Resource Leveling  The PM of the documentary project knows that there will be no problem raised by the apparent conflict in the allocation of the producer’s time.  A reallocation decision may be intended to avoid future problems rather than to cure a present problem  When resources are added to a project , the PM may be asked to explain just how the project budget came to be underestimated  A more or less steady state demand for human resources is highly desirable – if not seriously inconsistent with the technological demands of the project – the cost of laying off, adding, or permanently releasing human being is very high for both hourly and salaried personnel  If the parent organization is quite large and is operating many projects that have reasonably high commonality in their demand for certain skills, it is often possible to set up ―pools‖ for such skills are clerical, machine operations and similar types of workers  Pools of like resources form which labor can be added temporarily to projects tend to cut costs for the firm as a whole Resource Loading/Leveling and Uncertainty 1 CGMS401-Chapter 6- Allocating Scare Resources to the Project  Figure 6-10 depicts the total number of hours required of a resource group displayed against the group’s capacity  21 members  40 hours – 5 day week  Most PM software will, when asked politely, level out the loads (usage) for individual resources and warn the PM when a resource is scheduled for great-than-capacity workloads. Whenever possible, the leveling will utilize any available activity slack rather than extend the duration of the project  Only necessary to have excess resources because of uncertainty that exists in the projects 6.4 Allocating Scare Resources to Projects  Most solutions start with the PERT/CPM schedule  If the demand for a resource exceeds its supply, the software considers the tasks one by one and assigns resources to the tasks according to some priority rule chosen by the PM  Tasks that do not get resources are delayed until ongoing tasks are completed and the required resources are freed-up for use. Some Comments about Constrained Resources  Every time a project falls behind schedule, the Pm is apt to plead for more resources  Serious cases of resource scarcity rarely apply to resources in general but rather one or two specific resources – such resources are called Walts Some Priority Rules  There are many possible rules for assigning preference to some activities over others when allocating scarce resource  Several of the most commonly used rules are: 1. As soon as possible: this is the standard rule for scheduling. Activities are scheduled to start on their ESTs, and resources are made available with that in mind 2. As late as possible: with this rule, resources are made available so that activities start on their LSTs whenever possible without increasing the
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