Developing a project schedule and assigning resources to each task is a critical phase in Project Management, mainly due to the inherent variability of future activities execution time and associated costs. Nowadays, PERT and Monte Carlo Simulation are among the most frequently adopted methods by best-in-class companies, especially in engineering and constructing sector, to schedule project activities. Critical Path Method (CPM) is also commonly used to identify the optimal project duration. In fact, notwithstanding the inherent variability associated with the execution of each activity, expected project completion date can be trimmed by acting on the expected duration of some of the activities. This is particular relevant considering that, often, the contract includes economic penalties if the project activities are delayed beyond expected completion date, while there can also be incentives, be the project completed ahead of schedule. Critical Path Method (CPM) algorithms typically start considering an initial project schedule based on “standard” activities duration and proceed reducing the expected duration until the marginal saving due to the reduction of the indirect costs equals the marginal cost deriving from the additional resources required to carry out the activity. The procedure is iterated for every activity lying on the project’s critical path. One of the limiting assumption of known algorithms is that they approximate the CPM cost curve as the straight segment joining the standard time/standard cost point with the accelerated time / increased cost one. The present paper discusses the problem of analytical determination of the CPM curve through a software tool embedded in one of the most known Project Management software (Primavera 5.0). The developed system encompasses two modules. The first module is a classic PERT tool, whose output is the definition of the slacks and of the critical path. The second module is able to define in real time and simulate the time-cost curves through polynomial functions whose parameters are set-up through regression of a set of historical data concerning similar activities. The system is able to dynamically adjust its overall schedule taking into account changes occurring in the project (e.g. an unexpected event causing a delay, or the sudden unavailability of a resource already scheduled to carry out a certain activity, etc.) and calculates in real time the optimal duration of each activity with respect to its costs and related resources. The prototype system has been tested in an engineering company involved in the design and realization of infrastructures (shelters and related facilities) for a new high-speed railway station. The application allowed the company to close the project in advance with respect to expected times and without extra costs.

Real time project resources schedule through a simulation approach of Critical Path Method

Savino M;
2008

Abstract

Developing a project schedule and assigning resources to each task is a critical phase in Project Management, mainly due to the inherent variability of future activities execution time and associated costs. Nowadays, PERT and Monte Carlo Simulation are among the most frequently adopted methods by best-in-class companies, especially in engineering and constructing sector, to schedule project activities. Critical Path Method (CPM) is also commonly used to identify the optimal project duration. In fact, notwithstanding the inherent variability associated with the execution of each activity, expected project completion date can be trimmed by acting on the expected duration of some of the activities. This is particular relevant considering that, often, the contract includes economic penalties if the project activities are delayed beyond expected completion date, while there can also be incentives, be the project completed ahead of schedule. Critical Path Method (CPM) algorithms typically start considering an initial project schedule based on “standard” activities duration and proceed reducing the expected duration until the marginal saving due to the reduction of the indirect costs equals the marginal cost deriving from the additional resources required to carry out the activity. The procedure is iterated for every activity lying on the project’s critical path. One of the limiting assumption of known algorithms is that they approximate the CPM cost curve as the straight segment joining the standard time/standard cost point with the accelerated time / increased cost one. The present paper discusses the problem of analytical determination of the CPM curve through a software tool embedded in one of the most known Project Management software (Primavera 5.0). The developed system encompasses two modules. The first module is a classic PERT tool, whose output is the definition of the slacks and of the critical path. The second module is able to define in real time and simulate the time-cost curves through polynomial functions whose parameters are set-up through regression of a set of historical data concerning similar activities. The system is able to dynamically adjust its overall schedule taking into account changes occurring in the project (e.g. an unexpected event causing a delay, or the sudden unavailability of a resource already scheduled to carry out a certain activity, etc.) and calculates in real time the optimal duration of each activity with respect to its costs and related resources. The prototype system has been tested in an engineering company involved in the design and realization of infrastructures (shelters and related facilities) for a new high-speed railway station. The application allowed the company to close the project in advance with respect to expected times and without extra costs.
8888198148
Critical Path Method; Resource Costs; Simulation
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Utilizza questo identificativo per citare o creare un link a questo documento: http://hdl.handle.net/20.500.12070/11148
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