Topic 3
Probabilistic Activity Times
PERT
Lecture: PhD. Đinh Bá Hùng Anh
Tel: 01647.077.055/090.9192.766
Mail:
[email protected] Contents
Probabilistic Activity Times
Probability Analysis of a Project Network
Project Crashing
Example Problem
3-2
Probabilistic Activity Times
■ Activity time estimates usually cannot be made with certainty.
■ PERT used for probabilistic activity times.
■ In PERT, three time estimates are used: most likely time (m), the
optimistic time (a), and the pessimistic time (b).
■ These provide an estimate of the mean and variance of a beta
distribution: Three-Point Method
2
b - a
variance: v
6
mean (expected time)
t a 4m b
6
a m b
3-3
Probabilistic Activity Times
Figure 3.1: Network for Installation Order Processing System 3-4
Probabilistic Activity Times
Table 3.1: Activity Time Estimates for Figure 3.1 3-5
Probabilistic Activity Times
Figure 3.2: Earliest and Latest Activity Times 3-6
Probabilistic Activity Times
Expected Project Time and Variance
■ Expected project time is the sum of the expected times of the
critical path activities.
■ Project variance is the sum of the critical path activities’ variances
■ The expected project time is assumed to be normally distributed
(based on central limit theorem).
■ In example, expected project time (tp) and variance (vp) interpreted
as the mean () and variance (2) of a normal distribution:
= 25 weeks
2 = 62/9
= 6.9 (weeks)2
3-7
Probability Analysis of a Project Network
■ Using the normal distribution, probabilities are determined by
computing the number of standard deviations (Z) a value is from
the mean.
■ The Z value is used to find corresponding probability in Table
3.2.
3-8
Probability Analysis of a Project Network
P(Z < 0,12) = (0,12) = 0,5478
3-9
Probability Analysis of a Project Network
Table 3.2
3-10
Probability Analysis of a Project Network
Figure 3.3: Normal Distribution of Network Duration
3-11
Probability Analysis of a Project Network
What is the probability that the new order processing system will
be ready by 30 weeks?
µ = 25 weeks
2 = 6.9 = 2.63 weeks
Z = (x-)/ = (30 -25)/2.63 = 1.90
Z value of 1.90 corresponds to probability of 0.9713 in Table 3.2.
Probability of completing project in 30 weeks or less = 0.9713.
3-12
Probability Analysis of a Project Network
Figure 3.3: Probability the Network will be completed in 30 weeks or less
3-13
Probability Analysis of a Project Network
■ A customer will trade elsewhere if the new ordering system is
not working within 22 weeks. What is the probability that she
will be retained?
Z = (22 - 25)/2.63 = -1.14
■ Z value of 1.14 (ignore negative) corresponds to probability
of .8729 in Table 3.2.
■ Probability that customer will be retained is .1271
3-14
Probability Analysis of a Project Network
Figure 3.4: Probability the Network will be completed in 22 weeks
or less.
3-15
Project Crashing
■ Project duration can be reduced by assigning more resources
to project activities.
■ However, doing this increases project cost.
■ Decision is based on analysis of trade-off between time and
cost.
■ Project crashing is a method for shortening project duration
by reducing one or more critical activities to a time less than
normal activity time.
3-16
Project Crashing
Figure 3.5: The Project Network for Building a house
3-17
Project Crashing
Crash cost & crash time have a linear relationship:
Total Crash Cost $2000
Total Crash Time 5 weeks
$400 / wk
Figure 3.6
3-18
Project Crashing
Table 3.3
3-19
Project Crashing
Figure 3.7: Network with Normal Activity times and weekly crashing
costs 3-20
Project Crashing
As activities are crashed, the critical path may change and several
paths may become critical.
Figure 3.8: Revised
Network with activity 1
crashed
3-21
Project Crashing
■ Project crashing costs and indirect costs have an inverse
relationship.
■ Crashing costs are highest when the project is shortened.
■ Indirect costs increase as the project duration increases.
■ Optimal project time is at minimum point on the total cost
curve.
3-22
Project Crashing
Figure 3.9: The Time-Cost Trade-Off
3-23
Project Crashing
Example
j 1 2 3 4 5 6 7 8 9 10 11 12 13 14
8, 10, 12,
Prio. - 1 1 2 3 3 4 5,6 5,6 7
9 11
11
13
pj 5 6 9 12 7 12 10 6 10 9 7 8 7 5
cashj 3 5 7 9 5 9 8 3 7 5 4 5 5 2
cj 7 2 4 3 4 3 4 4 4 5 2 2 4 8
cjcash 20 25 20 15 30 40 35 25 30 20 25 35 20 10
3-24
Project Crashing
Maximum Processing Times
6 12 10
2 4 7 9
5 10
12 10 8 5
1
6 9 12 14
9 7 7
3 11 13
7 6
5 8
3-25
Project Crashing
6 12 10 9
processing time
2 4 7 10 8
5
12 10 12 5
S 1
6 9 14 T
9 7 7
3 11 13
7 6
5 8
longest path 56 1 3 6 9 11 12 14
3-26
Project Crashing
Maximum Processing Times
Pmax = 56
6 12 10
2 4 7
9
5 10
12 10 8 5
1
6 9 12 14
9 7 7
3 11 13
7 6
5 8
Minimum cut sets: {1}, {3}, {6}, {9}, {11}, {12}, {14}
3-27
Project Crashing
Critical Path Subgraph (Gcp)
C1=7
C6=3 C9=4 C12=2 C14=8
1
6 9 12 14
3 11
C3=4 C11=2
Cut sets: {1},{3},{6},{9}, Minimum cut set with
{11},{12},{14}. lowest cost: {11} and {12}.
j 1 2 3 4 5 6 7 8 9 10 11 12 13 14
cj 7 2 4 3 4 3 4 4 4 5 2 2 4 8
3-28
Project Crashing
Activity N.time C.time N.Cost C.Cost Crash cost/pd Crash by Crashing cost
Project 56 37
1 5 3 7 20 6.5 2 13
2 6 5 2 25 23 1 23
3 9 7 4 20 8 2 16
4 12 9 3 15 4 3 12
5 7 5 4 30 13 0 0
6 12 9 3 40 12.33 3 37
7 10 8 4 35 15.5 2 31
8 6 3 4 25 7 0 0
9 10 7 4 30 8.67 3 26
10 9 5 5 20 3.75 4 15
11 7 4 2 25 7.67 3 23
12 8 5 2 35 11 3 33
13 7 5 4 20 8 2 16
14 5 2 8 10 .67 3 2
TOTALS 56 247
3-29
Project Crashing
6 12 10 9 processing time
2 4 7 10 7
5
12 10 12 5
S 1
6 9 14 T
9 7 7
3 11 13
7 6
5 8
longest path 55 : 1 3 6 9 11 12,13 14
3-30
Project Crashing
Critical Path Subgraph (Gcp)
C1=7
C6=3 C9=4 C12=2 C14=8
1
6 9 12 14
3 11 13
C3=4 C11=2 C13=4
Minimum cut sets: {1},{3},{6}, Minimum cut set with
{9}, {11},{12,13},{14}. lowest cost {11}
C11 = 2 < C0 = 6 net saving of 4 P11 = 6.
j 1 2 3 4 5 6 7 8 9 10 11 12 13 14
cj 7 2 4 3 4 3 4 4 4 5 2 2 4 8
3-31
Project Crashing
Critical Path Subgraph (Gcp)
C1=7
C6=3 C9=4 C12=2 C14=8
1
6 9 12 14
3 11 13
C3=4 C11=2 C13=14
Reduce processing time Reduce processing
next on job 6 time
3-32
Project Crashing
6 12 10 9 processing time
2 4 7 10 7
5
12 10 12 5
S 1
6 9 14 T
9 6 7
3 11 13
7 6
5 8
longest path 54 : 1 3 6 9 11 12,13 14
or : 1 2 4 7 10 12 14
minimum cut sets :
1, i, j: i 2,4,7,10,12 j {3,6,9,11}, 12,13, 14
minimum cut set with lowest costs : 2,11
c 2 c11 4 c 0 6 net savings of 2 p2 : 5*, p11 : 5 3-33
Project Crashing
job 2 hits 5min 12 10 9 processing time
minimum 2 4 7 10 7
5
12 10 12 5
S 1
6 9 14 T
9 5 7
3 11 13
7 6
5 8
longest path 53 : 1 3 6 9 11 12,13 14
or : 1 2 4 7 10 12 14
minimum cut sets :
1, i, j: i 4,7,10,12 j {3,6,9,11}, 12,13, 14
minimum cut set with lowest costs : 4,11
c 4 c11 5 c 0 6 net savings of 1 p 4 : 11, p11 : 4 * 3-34
Project Crashing
5min 11 10 9 processing time
2 4 7 10 7
5
12 10 12 5
S 1
6 9 14 T
9 4min 7
3 11 13
7 6
5 8
longest path 52 : 1 3 6 9 11 12,13 14
or : 1 2 4 7 10 12 14
minimum cut sets :
1, i, j: i 4,7,10,12 j {3,6,9}, 12,13, 14
minimum cut set with lowest costs : 4,6
c 4 c 6 6 c 0 6 no net savings STOP 3-35
Example Problem
Problem Statement and Data
Given this network and the data on the following slide, determine the
expected project completion time and variance, and the probability
that the project will be completed in 28 days or less.
3-36
Example Problem
Problem Statement and Data
3-37
Example Problem
Solution
Step 1: Compute the expected activity times and variances.
2
b -
a
t a 4m b
v
6 6
3-38
Example Problem
Step 2: Determine the earliest and latest activity times & slacks
3-39
Example Problem
Step 3: Identify the critical path and compute expected
completion time and variance.
Critical path (activities with no slack): 1 3 5 7
Expected project completion time: tp = 9+5+6+4 = 24 days
Variance: vp = 4 + 4/9 + 4/9 + 1/9 = 5 (days)2
3-40
Example Problem
Step 4: Determine the Probability That the Project Will be
Completed in 28 days or less (µ = 24, = 5)
Z = (x - )/ = (28 -24)/5 = 1.79
Corresponding probability from Table 3.2, is .9633 and P(x 28)
= 0.9633.
3-41
Home work
Precedence Relationships Chart
Immediate
Activity Optimistic Most Likely Pessimistic
predecessor
A - 76 86 120
B A 12 15 18
C B 4 5 6
D G 15 18 33
E D 18 21 24
F A 16 26 30
G C, F 10 13 22
H D 24 18 32
I A 22 27 50
J D, I 38 43 60
3-42
