In this section we consider the details of

project scheduling for a problem involving

new-product research and development.
Because many of the activities in such a
project have never been attempted by this
organization, the project manager wants to
account for uncertainties in the activity times.
Let us show how project scheduling can be
conducted with the uncertain activity times.
The H.S. Daugherty Company has manufactured industrial
vacuum cleaning systems for many years. Recently, a
member of the company’s new-product research team
submitted a report suggesting that the company consider
manufacturing a cordless vacuum cleaner. The new product,
referred to as Porta-Vac, could contribute to Daugherty’s
expansion into the household market. Management hopes
that the Porta-Vac can be manufactured at a reasonable cost
and that its portability and no-cord convenience will make it
extremely attractive to potential consumers.
 Daugherty’s management wants to study
the feasibility of manufacturing the Porta-Vac Accurate activity time
estimate are important in
product. The feasibility study will provide a
the development of an
recommendation on the action to be taken. To activity schedule. When
complete this study, information must be activity times are uncertain,
obtained from the firm’s research and the three time estimates-
optimistic, most probable,
development (R&D), product testing, and pessimistic-allow the
manufacturing, cost estimating, and market project manager to take
research groups. uncertainty into
consideration in determining
Again, the first step in this project the critical path and the
activity schedule. This
scheduling process is to identify all activities approach was developed by
that make up the project and determine the the designers of PERT
immediate predecessor(s) for each activity.
Activity Description Immediate Predecessor

A Develop product design -

B Plan market research -

C Prepare routing ( manufacturing engineering) A

D Build prototype model A

E Prepare marketing brochure A

F Prepare cost estimates (industrial engineering) C

G Do preliminary product testing D

H Complete market survey B,E

I Prepare pricing and forecast report H

J Prepare final report F,G,I

 F
C
Cost
Routing
Estimates

A J
D G
Prepare Final Finish
Design
Prototype Testing Report

E H I
Start Marketing Market Pricing and
Brochure Survey Forecast

B
Plan Market
Research
Once we develop the project network, we will need information on the time
required to complete each activity. This information is used in calculating
the total time required to complete the project and in scheduling of specific
activities. For repeat projects, such as construction and maintenance
projects, managers may have the experience and historical data necessary
to provide accurate activity time estimates. However, for new or unique
projects, estimating the time for each activity may be quite difficult. In fact,
in many cases activity times are uncertain and are best described by a
range of possible values rather than by one specific time estimate. In these
instances, the uncertain activity times are treated as random variables with
associated probability distributions. As a result, probability statements will
be provided about the ability to meet a specific project completion date.
 To incorporate uncertain activity times into the analysis, we need to
obtain three time estimates for each activity:

Optimistic time a = the minimum activity time if everything progress ideally

Most probable time m = the most probable activity time under normal conditions

Pessimistic time b = the maximum activity time if substantial delays are encountered

To illustrate the PERT/CPM procedure with uncertain activity times, let

us consider the optimistic, most probable, and pessimistic time estimates for
the Porta-Vac activities presented in Table 9.4. Using A as an example, we
see that the most probable time is 5 weeks, with a range from 4 weeks
(optimistic) to 12 weeks (pessimistic).
If the activity could be repeated a large number of times, what is the
average time for the activity? This average or expected time (t) is as
follows:

(9.4)

For activity A we have an average or expected time of

Activity Optimistic (a) Most Probable (m) Pessimistic (b)

A 4 5 12

B 1 1.5 5

C 2 3 4

D 3 4 11

E 2 3 4

F 1.5 2 2.5

G 1.5 3 4.5

H 2.5 3.5 7.5

I 1.5 2 2.5

J 1 2 3
With the uncertain activity times, we can use the variance to describe the
dispersion or the variation in the activity time values. The variance of the
activity time is given by the formula 1

The difference between the pessimistic (b) and optimistic (a) time estimates
greatly affects the value of the variance. Large differences in these two values
reflect a high degree of the uncertainty in the activity time. Using equation (9.5),
we obtain the measure of uncertainty- that this is, the variance- of activity A,
denoted
2 2
 Most Probable Expected (t)

Optimistic Pessimistic

0 4 5 6
Activity Expected Time (weeks) Variance

A 6 1.78

B 2 0.44

C 3 0.11

D 5 1.78

E 3 0.11

F 2 0.03

G 3 0.25

H 4 0.69

I 2 0.03

J 2 0.11

Total 32
 C F
3 2

A D G J
Finish
6 5 3 2

E H I
Start
3 4 2

B
2
 When uncertain
When we have the project network and the expected activity times, we
activity times are
are ready to proceed with the critical path calculations necessary to
considered, the actual
determine the expected time required to complete the project and
time required to
determine the activity schedule. In these calculations, we find the
complete the project
critical path for the Porta-Vac project by applying the critical path
may differ from the
procedure introduced in section 9.1 to the expected activity times.
expected time to
After the critical activities and the expected time to complete the
complete the project
project have been determined, we analyze the effect of the activity
provided by the
time variability. Proceeding with a forward pass through the network
critical path
shown in figure 9.9, we can establish the earliest start (ES) and
calculations. However,
earliest (EF) times for each activity. Figure 9.10 shows the project
for planning purposes,
network with the ES and EF values, Note that the earliest finish time
the expected time
for activity J, the last activity, is 17 weeks, Thus, the expected
provides valuable
completion time for the project is 17 weeks. Next, we make a
information for the
backward pass through the network. The backward pass provides the
project manager
latest start (LS) and the latest finish (LF) times shown in Figure 9.11
 C 6 9 F 9 11
3 2

A 0 6 D 6 11 G 11 14 J 15 17
Finish
6 5 3 2

E 6 9 H 9 13 I 13 15
Start
3 4 2

B 0 2
2
 C 6 9 F 9 11
3 10 13 2 13 15

A 0 6 D 6 11 G 11 14 J 15 17
Finish
6 0 6 5 7 12 3 12 15 2 15 17

E 6 9 H 9 13 I 13 15
Start
3 6 9 4 9 13 2 13 15

B 0 2
2 7 9
Activity Earliest Start Latest Start Earliest Finish Latest Finish Slack (LS - ES) Critical
(ES) (LS) (EF) (LF) Path?

A 0 0 6 6 0 Yes

B 0 7 2 9 7

C 6 10 9 13 4

D 6 7 11 12 1

E 6 6 9 9 0 Yes

F 9 13 11 15 4

G 11 12 14 15 2

H 9 9 13 13 0 Yes

I 13 13 15 15 0 Yes

J 15 15 17 17 0 Yes
For a project involving uncertain activity times, the probability that the project
can be completed within a specified amount of time is helpful managerial
information. To understand the effect of variability on project management, we
consider the variation along every path through the Porta-Vac project network.
Examining Figure 9.11, we observe four paths through the project network:
path 1= A-E-H-I-J, path 2= A-C-F-J, path 3= A-D-G-J, and path 4= B-H-I-J. Let
the random variable Ti denote the total time to complete the path i . The
expected value of Ti is equal to the sum of the expected times of the activities
along path i . For path 1 (the critical path), the expected time is
The variance of Ti is the sum of the variances of the activities along path. For
path 1 (the critical path)’, the variance in completion time is
2

Where are the variances of the activities A,E,H,I and J.

The formula for is based on the assumption that the activity times are
independent.

If two or more activities are dependent, the formula provides only an

approximation of the variance of the path completion time. The closer the
activities are to being independent, the better the approximation.

Knowing that the standard deviation is the square root of the variance,
we compute the standard deviation for path 1 completion time as
Assuming that the distribution of the path completion time Ti follows a normal
or bellshaped distribution allows us to draw the distribution shown in Figure
9.12. With this distribution, we can compute the probability that a path of
activities will meet be completed within a specified time. For example, suppose
that management allotted 20 weeks for the Porta-Vac project. What is the
probability that path 1 will be completed within 20 weeks? We are asking for
the probability that Ti < 20, which corresponds graphically to the shaded area
in Figure 9.13. The z-score for the normal probability distribution at Ti = 20 is
Using z = 1.82 and the table for the normal distribution (see
Appendix B), we find that the probability of path 1 meeting
the 20-week deadline is 0.9565.
The normal distribution
As Table 9.7 shows, path 2 and path 4 are virtually
tends to be a better
guaranteed to be completed by the 20-week deadline and approximation of the
path 3 has a probability of 0.9783 of meeting the 20-week distribution of completion
deadline. time for larger projects.

Appendix 9.1 describes how

One method for estimating the probability that the
to compute cumulative
entire Porta-Vac project will be completed by the 20-week probabilities for normal
deadline is to consider only the path with the smallest random variables in Excel.
completion probability. As is often the case, the critical path
(path 1) has the smallest completion probability. So a
simple estimate of the probability that the entire Porta-Vac
project will be complete within 20 weeks is 0.9656.
 Expected
completion time

T
17
Time (Weeks)
 17 20
Time (Weeks)
 Expected Path Standard Deviation of z-score Probability of Meeting
Completion Time Path Completion Time Deadline
 A common computational shortcut is to base the probability estimate of
the entire being complete by a deadline solely on the critical path. However, a
probability estimate based only on the critical activities may be overly
optimistic. When uncertain activities times exist, longer-than-expected
completion times for one or more noncritical activities may cause an original
noncritical activity to become critical and hence increase the time required to
complete the project.

Because all paths must be completed in order for the entire project to be
completed, an alternative method for computing the entire project’s chance of
completion by the deadline is

P (path completed by deadline) x P (path 2 completed by deadline x P (path 3

completed by deadline) x P (path 4 completed by deadline)

0.9656 x 1.0 x 0.9783 x 1.0 = 0.9446

 This calculation assumes that each path is
independent. As all of these paths share at least one
common activity, this assumption is violated.
Consequentially, this estimate will be a pessimistic
Simulation is another estimate of the likelihood of meeting the project deadline.
technique used in project
management and is Regardless of the method to estimate the completion
particularly useful for probability, a project manager should frequently monitor
estimating the probability
the progress of the project. In particular, the project
of an extremely complex
manager should monitor activities with large variances in
project being completed
by a specific deadline. their activity times. The management Science in Action,
Project Management Helps the U.S. Air Force Reduce
Maintenance Time, describes how closely managing the
progress of individual activities and the assignment of
resources led to dramatic improvements in the
maintenance of military aircraft.
Warner Robins Air Logistics Center (WR-ALC) Identifying tasks at a level of detail that allowed
provides maintenance and repair services for U.S. supervisors to clearly assign mechanics,
Air Force aircraft and ground equipment. To maintenance tools, and facilities resulted in a project
support combat zone efforts, the U.S. Air Force network of approximately 450 activities.
requested that WR-ALC reduce the amount of
By explicitly accounting for each task’s
time it took to complete maintenance service on its resource requirements (mechanics, aircraft parts,
C-5 transporter aircraft. maintenance tools, etc.), CCPM identifies a “critical
chain” of activities. Efforts to reduce the critical chain
To identify ways to improve the management
led to the insight that a task should not be started
of its repair and overhaul process, WR-ALC until all resources needed to complete the task are
adopted the method of critical chain project available. While this approach, called “pipelining”,
management (CCPM) by viewing each aircraft at often results in an initial delay to start of a task, it
its facility as a project with a series of tasks, allows for a quicker completion of the task by
precedence dependencies between these tasks, eliminating delays after the task’s launch and by
and resource requirements. reducing efficiency-robbing multitasking (across
tasks) by the mechanics.