Advanced Scheduling Techniques

Source:
https://www.cmu.edu/cee/projects/PMbook/11_Advanced_Scheduling_Techniques.html

11.1 Use of Advanced Scheduling Techniques

Construction project scheduling is a topic that has received extensive research over a number of
decades. The previous chapter described the fundamental scheduling techniques widely used and
supported by numerous commercial scheduling systems. A variety of special techniques have
also been developed to address specific circumstances or problems. With the availability of more
powerful computers and software, the use of advanced scheduling techniques is becoming easier
and of greater relevance to practice. In this chapter, we survey some of the techniques that can be
employed in this regard. These techniques address some important practical problems, such as:

 scheduling in the face of uncertain estimates on activity durations,

 integrated planning of scheduling and resource allocation,
 scheduling in unstructured or poorly formulated circumstances.

A final section in the chapter describes some possible improvements in the project scheduling
process. In Chapter 14, we consider issues of computer based implementation of scheduling
procedures, particularly in the context of integrating scheduling with other project management
procedures.

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11.2 Scheduling with Uncertain Durations

Section 10.3 described the application of critical path scheduling for the situation in which
activity durations are fixed and known. Unfortunately, activity durations are estimates of the
actual time required, and there is liable to be a significant amount of uncertainty associated with
the actual durations. During the preliminary planning stages for a project, the uncertainty in
activity durations is particularly large since the scope and obstacles to the project are still
undefined. Activities that are outside of the control of the owner are likely to be more uncertain.
For example, the time required to gain regulatory approval for projects may vary tremendously.
Other external events such as adverse weather, trench collapses, or labor strikes make duration
estimates particularly uncertain.

Two simple approaches to dealing with the uncertainty in activity durations warrant some
discussion before introducing more formal scheduling procedures to deal with uncertainty. First,
the uncertainty in activity durations may simply be ignored and scheduling done using the
expected or most likely time duration for each activity. Since only one duration estimate needs to
be made for each activity, this approach reduces the required work in setting up the original
schedule. Formal methods of introducing uncertainty into the scheduling process require more
work and assumptions. While this simple approach might be defended, it has two drawbacks.
First, the use of expected activity durations typically results in overly optimistic schedules for
completion; a numerical example of this optimism appears below. Second, the use of single
activity durations often produces a rigid, inflexible mindset on the part of schedulers. As field
managers appreciate, activity durations vary considerable and can be influenced by good
leadership and close attention. As a result, field managers may loose confidence in the realism of
a schedule based upon fixed activity durations. Clearly, the use of fixed activity durations in
setting up a schedule makes a continual process of monitoring and updating the schedule in light
of actual experience imperative. Otherwise, the project schedule is rapidly outdated.

A second simple approach to incorporation uncertainty also deserves mention. Many managers
recognize that the use of expected durations may result in overly optimistic schedules, so they
include a contingency allowance in their estimate of activity durations. For example, an activity
with an expected duration of two days might be scheduled for a period of 2.2 days, including a
ten percent contingency. Systematic application of this contingency would result in a ten percent
increase in the expected time to complete the project. While the use of this rule-of-thumb or
heuristic contingency factor can result in more accurate schedules, it is likely that formal
scheduling methods that incorporate uncertainty more formally are useful as a means of
obtaining greater accuracy or in understanding the effects of activity delays.

The most common formal approach to incorporate uncertainty in the scheduling process is to
apply the critical path scheduling process (as described in Section 10.3) and then analyze the
results from a probabilistic perspective. This process is usually referred to as the PERT
scheduling or evaluation method. [1] As noted earlier, the duration of the critical path represents
the minimum time required to complete the project. Using expected activity durations and
critical path scheduling, a critical path of activities can be identified. This critical path is then
used to analyze the duration of the project incorporating the uncertainty of the activity durations
along the critical path. The expected project duration is equal to the sum of the expected
durations of the activities along the critical path. Assuming that activity durations are
independent random variables, the variance or variation in the duration of this critical path is
calculated as the sum of the variances along the critical path. With the mean and variance of the
identified critical path known, the distribution of activity durations can also be computed.

The mean and variance for each activity duration are typically computed from estimates of
"optimistic" (ai,j), "most likely" (mi,j), and "pessimistic" (bi,j) activity durations using the
formulas:

(11.1)

and

(10.2)
where and are the mean duration and its variance, respectively, of an activity
(i,j). Three activity durations estimates (i.e., optimistic, most likely, and pessimistic durations)
are required in the calculation. The use of these optimistic, most likely, and pessimistic estimates
stems from the fact that these are thought to be easier for managers to estimate subjectively. The
formulas for calculating the mean and variance are derived by assuming that the activity
durations follow a probabilistic beta distribution under a restrictive condition. [2] The probability
density function of a beta distributions for a random varable x is given by:

(11.3)

where k is a constant which can be expressed in terms of and . Several beta distributions for
different sets of values of and are shown in Figure 11-1. For a beta distribution in the

interval having a modal value m, the mean is given by:

(11.4)

If + = 4, then Eq. (11.4) will result in Eq. (11.1). Thus, the use of Eqs. (11.1) and (11.2)
impose an additional condition on the beta distribution. In particular, the restriction that
= (b - a)/6 is imposed.
 Figure 11-1 Illustration of Several Beta Distributions

Since absolute limits on the optimistic and pessimistic activity durations are extremely difficult
to estimate from historical data, a common practice is to use the ninety-fifth percentile of activity
durations for these points. Thus, the optimistic time would be such that there is only a one in
twenty (five percent) chance that the actual duration would be less than the estimated optimistic
time. Similarly, the pessimistic time is chosen so that there is only a five percent chance of
exceeding this duration. Thus, there is a ninety percent chance of having the actual duration of an
activity fall between the optimistic and pessimistic duration time estimates. With the use of
ninety-fifth percentile values for the optimistic and pessimistic activity duration, the calculation
of the expected duration according to Eq. (11.1) is unchanged but the formula for calculating the
activity variance becomes:

(11.5)
The difference between Eqs. (11.2) and (11.5) comes only in the value of the divisor, with 36
used for absolute limits and 10 used for ninety-five percentile limits. This difference might be
expected since the difference between bi,j and ai,j would be larger for absolute limits than for the
ninety-fifth percentile limits.

While the PERT method has been made widely available, it suffers from three major problems.
First, the procedure focuses upon a single critical path, when many paths might become critical
due to random fluctuations. For example, suppose that the critical path with longest expected
time happened to be completed early. Unfortunately, this does not necessarily mean that the
project is completed early since another path or sequence of activities might take longer.
Similarly, a longer than expected duration for an activity not on the critical path might result in
that activity suddenly becoming critical. As a result of the focus on only a single path, the PERT
method typically underestimates the actual project duration.

As a second problem with the PERT procedure, it is incorrect to assume that most construction
activity durations are independent random variables. In practice, durations are correlated with
one another. For example, if problems are encountered in the delivery of concrete for a project,
this problem is likely to influence the expected duration of numerous activities involving
concrete pours on a project. Positive correlations of this type between activity durations imply
that the PERT method underestimates the variance of the critical path and thereby produces
over-optimistic expectations of the probability of meeting a particular project completion
deadline.

Finally, the PERT method requires three duration estimates for each activity rather than the
single estimate developed for critical path scheduling. Thus, the difficulty and labor of
estimating activity characteristics is multiplied threefold.

As an alternative to the PERT procedure, a straightforward method of obtaining information

about the distribution of project completion times (as well as other schedule information) is
through the use of Monte Carlo simulation. This technique calculates sets of artificial (but
realistic) activity duration times and then applies a deterministic scheduling procedure to each set
of durations. Numerous calculations are required in this process since simulated activity
durations must be calculated and the scheduling procedure applied many times. For realistic
project networks, 40 to 1,000 separate sets of activity durations might be used in a single
scheduling simulation. The calculations associated with Monte Carlo simulation are described in
the following section.

A number of different indicators of the project schedule can be estimated from the results of a
Monte Carlo simulation:

 Estimates of the expected time and variance of the project completion.

 An estimate of the distribution of completion times, so that the probability of meeting a
particular completion date can be estimated.
 The probability that a particular activity will lie on the critical path. This is of interest
since the longest or critical path through the network may change as activity durations
change.
The disadvantage of Monte Carlo simulation results from the additional information about
activity durations that is required and the computational effort involved in numerous scheduling
applications for each set of simulated durations. For each activity, the distribution of possible
durations as well as the parameters of this distribution must be specified. For example, durations
might be assumed or estimated to be uniformly distributed between a lower and upper value. In
addition, correlations between activity durations should be specified. For example, if two
activities involve assembling forms in different locations and at different times for a project, then
the time required for each activity is likely to be closely related. If the forms pose some
problems, then assembling them on both occasions might take longer than expected. This is an
example of a positive correlation in activity times. In application, such correlations are
commonly ignored, leading to errors in results. As a final problem and discouragement, easy to
use software systems for Monte Carlo simulation of project schedules are not generally available.
This is particularly the case when correlations between activity durations are desired.

Another approach to the simulation of different activity durations is to develop specific scenarios
of events and determine the effect on the overall project schedule. This is a type of "what-if"
problem solving in which a manager simulates events that might occur and sees the result. For
example, the effects of different weather patterns on activity durations could be estimated and
the resulting schedules for the different weather patterns compared. One method of obtaining
information about the range of possible schedules is to apply the scheduling procedure using all
optimistic, all most likely, and then all pessimistic activity durations. The result is three project
schedules representing a range of possible outcomes. This process of "what-if" analysis is similar
to that undertaken during the process of construction planning or during analysis of project
crashing.

Example 11-1: Scheduling activities with uncertain time durations.

Suppose that the nine activity example project shown in Table 10-2 and Figure 10-4 of Chapter
10 was thought to have very uncertain activity time durations. As a result, project scheduling
considering this uncertainty is desired. All three methods (PERT, Monte Carlo simulation, and
"What-if" simulation) will be applied.

Table 11-1 shows the estimated optimistic, most likely and pessimistic durations for the nine
activities. From these estimates, the mean, variance and standard deviation are calculated. In this
calculation, ninety-fifth percentile estimates of optimistic and pessimistic duration times are
assumed, so that Equation (11.5) is applied. The critical path for this project ignoring uncertainty
in activity durations consists of activities A, C, F and I as found in Table 10-3 (Section 10.3).
Applying the PERT analysis procedure suggests that the duration of the project would be
approximately normally distributed. The sum of the means for the critical activities is 4.0 + 8.0 +
12.0 + 6.0 = 30.0 days, and the sum of the variances is 0.4 + 1.6 + 1.6 + 1.6 = 5.2 leading to a
standard deviation of 2.3 days.

With a normally distributed project duration, the probability of meeting a project deadline is
equal to the probability that the standard normal distribution is less than or equal to (PD - D)|
D where PD is the project deadline, D is the expected duration and D is the standard
deviation of project duration. For example, the probability of project completion within 35 days
is:

where z is the standard normal distribution tabulated value of the cumulative standard
distribution appears in Table B.1 of Appendix B.

Monte Carlo simulation results provide slightly different estimates of the project duration
characteristics. Assuming that activity durations are independent and approximately normally
distributed random variables with the mean and variances shown in Table 11-1, a simulation can
be performed by obtaining simulated duration realization for each of the nine activities and
applying critical path scheduling to the resulting network. Applying this procedure 500 times, the
average project duration is found to be 30.9 days with a standard deviation of 2.5 days. The
PERT result is less than this estimate by 0.9 days or three percent. Also, the critical path
considered in the PERT procedure (consisting of activities A, C, F and I) is found to be the
critical path in the simulated networks less than half the time.

TABLE 11-1 Activity Duration Estimates for a Nine Activity Project

Activity Optimistic Duration Most Likely Duration Pessimistic Duration Mean Variance
A 3 4 5 4.0 0.4
B 2 3 5 3.2 0.9
C 6 8 10 8.0 1.6
D 5 7 8 6.8 0.9
E 6 9 14 9.3 6.4
F 10 12 14 12.0 1.6
G 2 2 4 2.3 0.4
H 4 5 8 5.3 1.6
I 4 6 8 6.0 1.6

If there are correlations among the activity durations, then significantly different results can be
obtained. For example, suppose that activities C, E, G and H are all positively correlated random
variables with a correlation of 0.5 for each pair of variables. Applying Monte Carlo simulation
using 500 activity network simulations results in an average project duration of 36.5 days and a
standard deviation of 4.9 days. This estimated average duration is 6.5 days or 20 percent longer
than the PERT estimate or the estimate obtained ignoring uncertainty in durations. If correlations
like this exist, these methods can seriously underestimate the actual project duration.
Finally, the project durations obtained by assuming all optimistic and all pessimistic activity
durations are 23 and 41 days respectively. Other "what-if" simulations might be conducted for
cases in which peculiar soil characteristics might make excavation difficult; these soil
peculiarities might be responsible for the correlations of excavation activity durations described
above.

Results from the different methods are summarized in Table 11-2. Note that positive correlations
among some activity durations results in relatively large increases in the expected project
duration and variability.

TABLE 11-2 Project Duration Results from Various Techniques and Assumptions for an
Example
Standard Deviation
Procedure and Assumptions Project Duration (days) of Project Duration (days)
Critical Path Method 30.0 NA
PERT Method 30.0 2.3
Monte Carlo Simulation
No Duration Correlations 30.9 2.5
Positive Duration Correlations 36.5 4.9
"What-if" Simulations
Optimistic 23.0 NA
Most Likely 30.0 NA
Pessimistic 41.0 NA

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11.3 Calculations for Monte Carlo Schedule Simulation

In this section, we outline the procedures required to perform Monte Carlo simulation for the
purpose of schedule analysis. These procedures presume that the various steps involved in
forming a network plan and estimating the characteristics of the probability distributions for the
various activities have been completed. Given a plan and the activity duration distributions, the
heart of the Monte Carlo simulation procedure is the derivation of a realization or synthetic
outcome of the relevant activity durations. Once these realizations are generated, standard
scheduling techniques can be applied. We shall present the formulas associated with the
generation of normally distributed activity durations, and then comment on the requirements for
other distributions in an example.

To generate normally distributed realizations of activity durations, we can use a two step
procedure. First, we generate uniformly distributed random variables, ui in the interval from zero
to one. Numerous techniques can be used for this purpose. For example, a general formula for
random number generation can be of the form:
(11.6)

where = 3.14159265 and ui-1 was the previously generated random number or a pre-selected
beginning or seed number. For example, a seed of u0 = 0.215 in Eq. (11.6) results in u1 = 0.0820,
and by applying this value of u1, the result is u2 = 0.1029. This formula is a special case of the
mixed congruential method of random number generation. While Equation (11.6) will result in a
series of numbers that have the appearance and the necessary statistical properties of true random
numbers, we should note that these are actually "pseudo" random numbers since the sequence of
numbers will repeat given a long enough time.

With a method of generating uniformly distributed random numbers, we can generate normally
distributed random numbers using two uniformly distributed realizations with the equations: [3]

(11.7)

with

where xk is the normal realization, x is the mean of x, x is the standard deviation of x, and u1
and u2 are the two uniformly distributed random variable realizations. For the case in which the
mean of an activity is 2.5 days and the standard deviation of the duration is 1.5 days, a
corresponding realization of the duration is s = 2.2365, t = 0.6465 and xk = 2.525 days, using the
two uniform random numbers generated from a seed of 0.215 above.

Correlated random number realizations may be generated making use of conditional

distributions. For example, suppose that the duration of an activity d is normally distributed and
correlated with a second normally distributed random variable x which may be another activity
duration or a separate factor such as a weather effect. Given a realization xk of x, the conditional
distribution of d is still normal, but it is a function of the value xk. In particular, the conditional
mean ( 'd|x = xk) and standard deviation ( 'd|x = xk) of a normally distributed variable given a
realization of the second variable is:
(11.8)

where dx is the correlation coefficient between d and x. Once xk is known, the conditional
mean and standard deviation can be calculated from Eq. (11.8) and then a realization of d
obtained by applying Equation (11.7).

Correlation coefficients indicate the extent to which two random variables will tend to vary
together. Positive correlation coefficients indicate one random variable will tend to exceed its
mean when the other random variable does the same. From a set of n historical observations of
two random variables, x and y, the correlation coefficient can be estimated as:

(11.9)

The value of xy can range from one to minus one, with values near one indicating a positive,
near linear relationship between the two random variables.

It is also possible to develop formulas for the conditional distribution of a random variable
correlated with numerous other variables; this is termed a multi-variate distribution. [4] Random
number generations from other types of distributions are also possible. [5] Once a set of random
variable distributions is obtained, then the process of applying a scheduling algorithm is required
as described in previous sections.

Example 11-2: A Three-Activity Project Example

Suppose that we wish to apply a Monte Carlo simulation procedure to a simple project involving
three activities in series. As a result, the critical path for the project includes all three activities.
We assume that the durations of the activities are normally distributed with the following
parameters:
Activity Mean (Days) Standard Deviation (Days)
A 2.5 1.5
B 5.6 2.4
C 2.4 2.0
To simulate the schedule effects, we generate the duration realizations shown in Table 11-3 and
calculate the project duration for each set of three activity duration realizations.

For the twelve sets of realizations shown in the table, the mean and standard deviation of the
project duration can be estimated to be 10.49 days and 4.06 days respectively. In this simple
case, we can also obtain an analytic solution for this duration, since it is only the sum of three
independent normally distributed variables. The actual project duration has a mean of 10.5 days,

and a standard deviation of days. With only a limited

number of simulations, the mean obtained from simulations is close to the actual mean, while the
estimated standard deviation from the simulation differs significantly from the actual value. This
latter difference can be attributed to the nature of the set of realizations used in the simulations;
using a larger number of simulated durations would result in a more accurate estimate of the
standard deviation.

TABLE 11-3 Duration Realizations for a Monte Carlo Schedule Simulation

Simulation Number Activity A Activity B Activity C Project Duration
1 1.53 6.94 1.04 9.51
2 2.67 4.83 2.17 9.66
3 3.36 6.86 5.56 15.78
4 0.39 7.65 2.17 10.22
5 2.50 5.82 1.74 10.06
6 2.77 8.71 4.03 15.51
7 3.83 2.05 1.10 6.96
8 3.73 10.57 3.24 17.53
9 1.06 3.68 2.47 7.22
10 1.17 0.86 1.37 3.40
11 1.68 9.47 0.13 11.27
12 0.37 6.66 1.70 8.72
Estimated Mean Project Duration = 10.49
Estimated Standard Deviation of Project Duration = 4.06
Note: All durations in days.

Example 11-3: Generation of Realizations from Triangular Distributions

To simplify calculations for Monte Carlo simulation of schedules, the use of a triangular
distribution is advantageous compared to the normal or the beta distributions. Triangular
distributions also have the advantage relative to the normal distribution that negative durations
cannot be estimated. As illustrated in Figure 11-2, the triangular distribution can be skewed to
the right or left and has finite limits like the beta distribution. If a is the lower limit, b the upper
limit and m the most likely value, then the mean and standard deviation of a triangular
distribution are:
(11.10)

(11.11)

The cumulative probability function for the triangular distribution is:

(11.12)

where F(x) is the probability that the random variable is less than or equal to the value of x.

Figure 11-2 Illustration of Two Triangular Activity Duration Distributions

Generating a random variable from this distribution can be accomplished with a single uniform
random variable realization using the inversion method. In this method, a realization of the
cumulative probability function, F(x) is generated and the corresponding value of x is calculated.
Since the cumulative probability function varies from zero to one, the density function
realization can be obtained from the uniform value random number generator, Equation (11.6).
The calculation of the corresponding value of x is obtained from inverting Equation (11.12):

(11.1
3)

For example, if a = 3.2, m = 4.5 and b = 6.0, then x = 4.8 and x = 2.7. With a uniform
realization of u = 0.215, then for (m-a)/(b-a) 0.215, x will lie between a and m and is found to
have a value of 4.1 from Equation (11.13).

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11.4 Crashing and Time/Cost Tradeoffs

The previous sections discussed the duration of activities as either fixed or random numbers with
known characteristics. However, activity durations can often vary depending upon the type and
amount of resources that are applied. Assigning more workers to a particular activity will
normally result in a shorter duration. [6] Greater speed may result in higher costs and lower
quality, however. In this section, we shall consider the impacts of time, cost and quality tradeoffs
in activity durations. In this process, we shall discuss the procedure of project crashing as
described below.

A simple representation of the possible relationship between the duration of an activity and its
direct costs appears in Figure 11-3. Considering only this activity in isolation and without
reference to the project completion deadline, a manager would undoubtedly choose a duration
which implies minimum direct cost, represented by Dij and Cij in the figure. Unfortunately, if
each activity was scheduled for the duration that resulted in the minimum direct cost in this way,
the time to complete the entire project might be too long and substantial penalties associated with
the late project start-up might be incurred. This is a small example of sub-optimization, in which
a small component of a project is optimized or improved to the detriment of the entire project
performance. Avoiding this problem of sub-optimization is a fundamental concern of project
managers.
 Figure 11-3 Illustration of a Linear Time/Cost Tradeoff for an Activity

At the other extreme, a manager might choose to complete the activity in the minimum possible
time, Dcij, but at a higher cost Ccij. This minimum completion time is commonly called the
activity crash time. The linear relationship shown in the figure between these two points implies
that any intermediate duration could also be chosen. It is possible that some intermediate point
may represent the ideal or optimal trade-off between time and cost for this activity.

What is the reason for an increase in direct cost as the activity duration is reduced? A simple case
arises in the use of overtime work. By scheduling weekend or evening work, the completion time
for an activity as measured in calendar days will be reduced. However, premium wages must be
paid for such overtime work, so the cost will increase. Also, overtime work is more prone to
accidents and quality problems that must be corrected, so indirect costs may also increase. More
generally, we might not expect a linear relationship between duration and direct cost, but some
convex function such as the nonlinear curve or the step function shown in Figure 11-4. A linear
function may be a good approximation to the actual curve, however, and results in considerable
analytical simplicity. [7]
 Figure 11-4 Illustration of Non-linear Time/Cost Tradeoffs for an Activity

With a linear relationship between cost and duration, the critical path time/cost tradeoff problem
can be defined as a linear programming optimization problem. In particular, let Rij represent the
rate of change of cost as duration is decreased, illustrated by the absolute value of the slope of
the line in Figure 11-3. Then, the direct cost of completing an activity is:

(11.14)

where the lower case cij and dij represent the scheduled duration and resulting cost of the activity
ij. The actual duration of an activity must fall between the minimum cost time (Dij) and the crash
time (Dcij). Also, precedence constraints must be imposed as described earlier for each activity.
Finally, the required completion time for the project or, alternatively, the costs associated with
different completion times must be defined. Thus, the entire scheduling problem is to minimize
total cost (equal to the sum of the cij values for all activities) subject to constraints arising from
(1) the desired project duration, PD, (2) the minimum and maximum activity duration
possibilities, and (3) constraints associated with the precedence or completion times of activities.
Algebraically, this is:
(11.15
)
subject to the constraints:

where the notation is defined above and the decision variables are the activity durations dij and
event times x(k). The appropriate schedules for different project durations can be found by
repeatedly solving this problem for different project durations PD. The entire problem can be
solved by linear programming or more efficient algorithms which take advantage of the special
network form of the problem constraints.

One solution to the time-cost tradeoff problem is of particular interest and deserves mention
here. The minimum time to complete a project is called the project-crash time. This minimum
completion time can be found by applying critical path scheduling with all activity durations set
to their minimum values (Dcij). This minimum completion time for the project can then be used
in the time-cost scheduling problem described above to determine the minimum project-crash
cost. Note that the project crash cost is not found by setting each activity to its crash duration and
summing up the resulting costs; this solution is called the all-crash cost. Since there are some
activities not on the critical path that can be assigned longer duration without delaying the
project, it is advantageous to change the all-crash schedule and thereby reduce costs.

Heuristic approaches are also possible to the time/cost tradeoff problem. In particular, a simple
approach is to first apply critical path scheduling with all activity durations assumed to be at
minimum cost (Dij). Next, the planner can examine activities on the critical path and reduce the
scheduled duration of activities which have the lowest resulting increase in costs. In essence, the
planner develops a list of activities on the critical path ranked in accordance with the unit change
in cost for a reduction in the activity duration. The heuristic solution proceeds by shortening
activities in the order of their lowest impact on costs. As the duration of activities on the shortest
path are shortened, the project duration is also reduced. Eventually, another path becomes
critical, and a new list of activities on the critical path must be prepared. By manual or automatic
adjustments of this kind, good but not necessarily optimal schedules can be identified. Optimal
or best schedules can only be assured by examining changes in combinations of activities as well
as changes to single activities. However, by alternating between adjustments in particular activity
durations (and their costs) and a critical path scheduling procedure, a planner can fairly rapidly
devise a shorter schedule to meet a particular project deadline or, in the worst case, find that the
deadline is impossible of accomplishment.

This type of heuristic approach to time-cost tradeoffs is essential when the time-cost tradeoffs for
each activity are not known in advance or in the case of resource constraints on the project. In
these cases, heuristic explorations may be useful to determine if greater effort should be spent on
estimating time-cost tradeoffs or if additional resources should be retained for the project. In
many cases, the basic time/cost tradeoff might not be a smooth curve as shown in Figure 11-4,
but only a series of particular resource and schedule combinations which produce particular
durations. For example, a planner might have the option of assigning either one or two crews to a
particular activity; in this case, there are only two possible durations of interest.

Example 11-4: Time/Cost Trade-offs

The construction of a permanent transitway on an expressway median illustrates the possibilities

for time/cost trade-offs in construction work. [8] One section of 10 miles of transitway was built
in 1985 and 1986 to replace an existing contra-flow lane system (in which one lane in the
expressway was reversed each day to provide additional capacity in the peak flow direction).
Three engineers' estimates for work time were prepared:

 975 calendar day, based on 750 working days at 5 days/week and 8 hours/day of
work plus 30 days for bad weather, weekends and holidays.
 702 calendar days, based on 540 working days at 6 days/week and 10 hours/day
of work.
 360 calendar days, based on 7 days/week and 24 hours/day of work.

The savings from early completion due to operating savings in the contra-flow lane and contract
administration costs were estimated to be $5,000 per day.

In accepting bids for this construction work, the owner required both a dollar amount and a
completion date. The bidder's completion date was required to fall between 360 and 540 days. In
evaluating contract bids, a $5,000 credit was allowed for each day less than 540 days that a
bidder specified for completion. In the end, the successful bidder completed the project in 270
days, receiving a bonus of 5,000*(540-270) = $450,000 in the $8,200,000 contract. However, the
contractor experienced fifteen to thirty percent higher costs to maintain the continuous work
schedule.

Example 11-5: Time cost trade-offs and project crashing

As an example of time/cost trade-offs and project crashing, suppose that we needed to reduce the
project completion time for a seven activity product delivery project first analyzed in Section
10.3 as shown in Table 10-4 and Figure 10-7. Table 11-4 gives information pertaining to
possible reductions in time which might be accomplished for the various activities. Using the
minimum cost durations (as shown in column 2 of Table 11-4), the critical path includes
activities C,E,F,G plus a dummy activity X. The project duration is 32 days in this case, and the
project cost is $70,000.
 TABLE 11-4 Activity Durations and Costs for a Seven Activity Project
Change in
Activity Minimum Cost Normal Duration Crash Cost Crash Duration Cost per Day
A 8 6 14 4 3
B 4 1 4 1 ---
C 8 8 24 4 4
D 10 5 24 3 7
E 10 9 18 5 2
F 20 12 36 6 2.7
G 10 3 18 2 8

Examining the unit change in cost, Rij shown in column 6 of Table 11-4, the lowest rate of
change occurs for activity E. Accordingly, a good heuristic strategy might be to begin by
crashing this activity. The result is that the duration of activity E goes from 9 days to 5 days and
the total project cost increases by $8,000. After making this change, the project duration drops to
28 days and two critical paths exist: (1) activities C,X,E,F and G, and (2) activities C, D, F, and
G.

Examining the unit changes in cost again, activity F has the lowest value of Rijj. Crashing this
activity results in an additional time savings of 6 days in the project duration, an increase in
project cost of $16,000, but no change in the critical paths. The activity on the critical path with
the next lowest unit change in cost is activity C. Crashing this activity to its minimum
completion time would reduce its duration by 4 days at a cost increase of $16,000. However, this
reduction does not result in a reduction in the duration of the project by 4 days. After activity C
is reduced to 7 days, then the alternate sequence of activities A and B lie on the critical path and
further reductions in the duration of activity C alone do not result in project time savings.
Accordingly, our heuristic corrections might be limited to reducing activity C by only 1 day,
thereby increasing costs by $4,000 and reducing the project duration by 1 day.

At this point, our choices for reducing the project duration are fairly limited. We can either
reduce the duration of activity G or, alternatively, reduce activity C and either activity A or
activity B by an identical amount. Inspection of Table 11-4 and Figure 10-4 suggest that
reducing activity A and activity C is the best alternative. Accordingly, we can shorten activity A
to its crash duration (from 6 days to 4 days) and shorten the duration of activity C (from 7 days
to 5 days) at an additional cost of $6,000 + $8,000 = $14,000. The result is a reduction in the
project duration of 2 days.

Our last option for reducing the project duration is to crash activity G from 3 days to 2 days at an
increase in cost of $8,000. No further reductions are possible in this time since each activity
along a critical path (comprised of activities A, B, E, F and G) are at minimum durations. At this
point, the project duration is 18 days and the project cost is $120,000., representing a fifty
percent reduction in project duration and a seventy percent increase in cost. Note that not all the
activities have been crashed. Activity C has been reduced in duration to 5 days (rather than its 4
day crash duration), while activity D has not been changed at all. If all activities had been
crashed, the total project cost would have been $138,000, representing a useless expenditure of
$18,000. The change in project cost with different project durations is shown graphically in
Figure 11-5.

Figure 11-5 Project Cost Versus Time for a Seven Activity Project

Example 11-8: Mathematical Formulation of Time-Cost Trade-offs

The same results obtained in the previous example could be obtained using a formal optimization
program and the data appearing in Tables 10-4 and 11-4. In this case, the heuristic approach used
above has obtained the optimal solution at each stage. Using Eq. (11.15), the linear programming
problem formulation would be:

Minimize z

= [8+3(6-dA)] + [4] + [8+4(8-dC)] + [10+7(5-dD)]

+ [10+2(9-dE)] + [20+2.7(9-dF)] + [10+2(3-dG)]
subject to the constraints
x(6) = PD x(0) + dA x(2)
x(0) + dC x(1)
x(1) x(3)
x(2) + dB x(4)
x(1) + dD x(4)
x(2) + dE x(4)
x(4) + dF x(5)
x(5) + dG x(6)
x(0) = 0
4 dA 6
1 dB 1
4 dC 8
3 dD 5
5 dE 9
6 dF 12
2 dG 3

which can be solved for different values of project duration PD using a linear programming
algorithm or a network flow algorithm. Note that even with only seven activities, the resulting
linear programming problem is fairly large.

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11.5 Scheduling in Poorly Structured Problems

The previous discussion of activity scheduling suggested that the general structure of the
construction plan was known in advance. With previously defined activities, relationships among
activities, and required resources, the scheduling problem could be represented as a mathematical
optimization problem. Even in the case in which durations are uncertain, we assumed that the
underlying probability distribution of durations is known and applied analytical techniques to
investigate schedules.

While these various scheduling techniques have been exceedingly useful, they do not cover the
range of scheduling problems encountered in practice. In particular, there are many cases in
which costs and durations depend upon other activities due to congestion on the site. In contrast,
the scheduling techniques discussed previously assume that durations of activities are generally
independent of each other. A second problem stems from the complexity of construction
technologies. In the course of resource allocations, numerous additional constraints or objectives
may exist that are difficult to represent analytically. For example, different workers may have
specialized in one type of activity or another. With greater experience, the work efficiency for
particular crews may substantially increase. Unfortunately, representing such effects in the
scheduling process can be very difficult. Another case of complexity occurs when activity
durations and schedules are negotiated among the different parties in a project so there is no
single overall planner.

A practical approach to these types of concerns is to insure that all schedules are reviewed and
modified by experienced project managers before implementation. This manual review permits
the incorporation of global constraints or consideration of peculiarities of workers and
equipment. Indeed, interactive schedule revision to accomadate resource constraints is often
superior to any computer based heuristic. With improved graphic representations and
information availability, man-machine interaction is likely to improve as a scheduling procedure.

More generally, the solution procedures for scheduling in these more complicated situations
cannot be reduced to mathematical algorithms. The best solution approach is likely to be a
"generate-and-test" cycle for alternative plans and schedules. In this process, a possible schedule
is hypothesized or generated. This schedule is tested for feasibility with respect to relevant
constraints (such as available resources or time horizons) and desireability with respect to
different objectives. Ideally, the process of evaluating an alternative will suggest directions for
improvements or identify particular trouble spots. These results are then used in the generation of
a new test alternative. This process continues until a satisfactory plan is obtained.

Two important problems must be borne in mind in applying a "generate-and-test" strategy. First,
the number of possible plans and schedules is enormous, so considerable insight to the problem
must be used in generating reasonable alternatives. Secondly, evaluating alternatives also may
involve considerable effort and judgment. As a result, the number of actual cycles of alternative
testing that can be accomadated is limited. One hope for computer technology in this regard is
that the burdensome calculations associated with this type of planning may be assumed by the
computer, thereby reducing the cost and required time for the planning effort. Some mechanisms
along these lines are described in Chapter 15.

Example 11-9: Man-machine Interactive Scheduling

An interactive system for scheduling with resource constraints might have the following
characteristics: [9]

 graphic displays of bar charts, resource use over time, activity networks and other
graphic images available in different windows of a screen simultaneously,
 descriptions of particular activities including allocated resources and chosen
technologies available in windows as desired by a user,
 a three dimensional animation of the construction process that can be stopped to
show the progress of construction on the facility at any time,
 easy-to-use methods for changing start times and allocated resources, and
 utilities to run relevant scheduling algorithms such as the critical path method at
any time.

Figure 11-6 shows an example of a screen for this system. In Figure 11-6, a bar chart appears in
one window, a description of an activity in another window, and a graph of the use of a particular
resource over time appears in a third window. These different "windows" appear as sections on a
computer screen displaying different types of information. With these capabilities, a project
manager can call up different pictures of the construction plan and make changes to accomadate
objectives or constraints that are not formally represented. With rapid response to such changes,
the effects can be immediately evaluated.
 Figure 11-6 Example of a Bar Chart and Other Windows for Interactive Scheduling

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11.6 Improving the Scheduling Process

Despite considerable attention by researchers and practitioners, the process of construction

planning and scheduling still presents problems and opportunities for improvement. The
importance of scheduling in insuring the effective coordination of work and the attainment of
project deadlines is indisputable. For large projects with many parties involved, the use of formal
schedules is indispensable.
The network model for representing project activities has been provided as an important
conceptual and computational framework for planning and scheduling. Networks not only
communicate the basic precedence relationships between activities, they also form the basis for
most scheduling computations.

As a practical matter, most project scheduling is performed with the critical path scheduling
method, supplemented by heuristic procedures used in project crash analysis or resource
constrained scheduling. Many commercial software programs are available to perform these
tasks. Probabilistic scheduling or the use of optimization software to perform time/cost trade-offs
is rather more infrequently applied, but there are software programs available to perform these
tasks if desired.

Rather than concentrating upon more elaborate solution algorithms, the most important
innovations in construction scheduling are likely to appear in the areas of data storage, ease of
use, data representation, communication and diagnostic or interpretation aids. Integration of
scheduling information with accounting and design information through the means of database
systems is one beneficial innovation; many scheduling systems do not provide such integration
of information. The techniques discussed in Chapter 14 are particularly useful in this regard.

With regard to ease of use, the introduction of interactive scheduling systems, graphical output
devices and automated data acquisition should produce a very different environment than has
existed. In the past, scheduling was performed as a batch operation with output contained in
lengthy tables of numbers. Updating of work progress and revising activity duration was a time
consuming manual task. It is no surprise that managers viewed scheduling as extremely
burdensome in this environment. The lower costs associated with computer systems as well as
improved software make "user friendly" environments a real possibility for field operations on
large projects.

Finally, information representation is an area which can result in substantial improvements.

While the network model of project activities is an extremely useful device to represent a project,
many aspects of project plans and activity inter-relationships cannot or have not been represented
in network models. For example, the similarity of processes among different activities is usually
unrecorded in the formal project representation. As a result, updating a project network in
response to new information about a process such as concrete pours can be tedious. What is
needed is a much more flexible and complete representation of project information. Some
avenues for change along these lines are discussed in Chapter 15.

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11.7 References

1. Bratley, Paul, Bennett L. Fox and Linus E. Schrage, A Guide to Simulation, Springer-
Verlag, 1973.
2. Elmaghraby, S.E., Activity Networks: Project Planning and Control by Network Models,
John Wiley, New York, 1977.
 3. Jackson, M.J., Computers in Construction Planning and Control, Allen & Unwin,
London, 1986.
4. Moder, J., C. Phillips and E. Davis, Project Management with CPM, PERT and
Precedence Diagramming, Third Edition, Van Nostrand Reinhold Company, 1983.

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11.8 Problems

1. For the project defined in Problem 1 from Chapter 10, suppose that the early, most likely
and late time schedules are desired. Assume that the activity durations are approximately
normally distributed with means as given in Table 10-16 and the following standard
deviations: A: 4; B: 10; C: 1; D: 15; E: 6; F: 12; G: 9; H: 2; I: 4; J: 5; K: 1; L: 12; M: 2;
N: 1; O: 5. (a) Find the early, most likely and late time schedules, and (b) estimate the
probability that the project requires 25% more time than the expected duration.

2. For the project defined in Problem 2 from Chapter 10, suppose that the early, most likely
and late time schedules are desired. Assume that the activity durations are approximately
normally distributed with means as given in Table 10-17 and the following standard
deviations: A: 2, B: 2, C: 1, D: 0, E: 0, F: 2; G: 0, H: 0, I: 0, J: 3; K: 0, L: 3; M: 2; N: 1.
(a) Find the early, most likely and late time schedules, and (b) estimate the probability
that the project requires 25% more time than the expected duration.

3 to 6
The time-cost tradeoff data corresponding to each of the Problems 1 to 4 (in Chapter 10),
respectively are given in the table for the problem (Tables 11-5 to 11-8). Determine the
all-crash and the project crash durations and cost based on the early time schedule for the
project. Also, suggest a combination of activity durations which will lead to a project
completion time equal to three days longer than the project crash time but would result in
the (approximately) maximum savings.
TABLE 11-5
Activity A B C D E F G H I J K L M N O
Shortest
Possible
Completio
n Time 3 5 1 10 4 6 6 2 4 3 3 3 2 2 5
Normal
Completio
n 15 25 22 30 26 12 50 10
Time Cost 0 0 80 400 0 0 0 0 200 180 220 0 0 120 500
Change in
Cost Per
Day 20 30 Infinity 15 20 25 10 35 20 Infinity 25 15 30 Infinity 10
 Earlier
Completio
n
TABLE 11-6
Activity A B C D E F G H I J K L M N
Shortest Possible
Completion Time 2 4 1 3 3 5 2 1 2 6 1 4 3 2
Normal
Completion 45 20 30 35 55 25 48 22
Time Cost 400 0 0 0 0 0 0 180 150 0 120 500 280 0
Crash Completion 51 25 35 43 64 30 52 26
Time Cost 460 0 0 0 0 0 0 250 150 0 150 560 320 0
TABLE 11-7
Activity A B C D E F G H I J K L
Shortest
Possible
Completion
Time 4 8 11 4 1 9 6 2 3 2 7 3
Normal
Completion
Time Cost 70 150 200 60 40 120 100 50 70 60 120 70
Crash
Completion
Time Cost 90 210 250 80 60 140 130 70 90 80 150 100
TABLE 11-8
Activity A B C D E F G H I J K L M
Shortest Possible
Completion Time 3 5 2 2 5 3 5 6 6 4 5 2 2
Normal Completion
Time Cost 50 150 90 125 300 240 80 270 120 600 300 80 140
Change in Cost Per
Day
Earlier Completion Infinity 50 Infinity 40 30 20 15 30 Infinity 40 50 40 40
7 to 10
Develop a project completion time versus cost tradeoff curve for the projects in Problems
3 to 6. (Note: a linear programming computer program or more specialized programs can
reduce the calculating work involved in these problems!)

11. Suppose that the project described in Problem 5 from Chapter 10 proceeds normally on
an earliest time schedule with all activities scheduled for their normal completion time.
However, suppose that activity G requires 20 days rather than the expected 5. What might
 a project manager do to insure completion of the project by the originally planned
completion time?

12. For the project defined in Problem 1 from Chapter 10, suppose that a Monte Carlo
simulation with ten repetitions is desired. Suppose further that the activity durations have
a triangular distribution with the following lower and upper bounds: A:4,8; B:4,9, C:
0.5,2; D: 10,20; E: 4,7; F: 7,10; G: 8, 12; H: 2,4; I: 4,7; J: 2,4; K: 2,6; L: 10, 15; M: 2,9;
N: 1,4; O: 4,11.
(a) Calculate the value of m for each activity given the upper and lower bounds and the
expected duration shown in Table 10-16.
(b) Generate a set of realizations for each activity and calculate the resulting project
duration.
(c) Repeat part (b) five times and estimate the mean and standard deviation of the project
duration.

13. Suppose that two variables both have triangular distributions and are correlated. The
resulting multi-variable probability density function has a triangular shape. Develop the
formula for the conditional distribution of one variable given the corresponding
realization of the other variable.

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11.9 Footnotes

1. See D. G. Malcolm, J.H. Rosenbloom, C.E. Clark, and W. Fazar, "Applications of a

Technique for R and D Program Evaluation," Operations Research, Vol. 7, No. 5, 1959, pp. 646-
669. Back

2. See M.W. Sasieni, "A Note on PERT Times," Management Science, Vol. 32, No. 12, p 1986,
p. 1652-1653, and T.K. Littlefield and P.H. Randolph, "An Answer to Sasieni's Question on Pert
Times," Management Science, Vol. 33, No. 10, 1987, pp. 1357-1359. For a general discussion of
the Beta distribution, see N.L. Johnson and S. Kotz, Continuous Univariate Distributions-2, John
Wiley & Sons, 1970, Chapter 24. Back

3. See T. Au, R.M. Shane, and L.A. Hoel, Fundamentals of Systems Engineering - Probabilistic
Models, Addison-Wesley Publishing Company, 1972. Back

4. See N.L. Johnson and S. Kotz, Distributions in Statistics: Continuous Multivariate

Distributions, John Wiley & Sons, New York, 1973. Back

5. See, for example, P. Bratley, B. L. Fox and L.E. Schrage, A Guide to Simulation, Springer-
Verlag, New York, 1983. Back
6. There are exceptions to this rule, though. More workers may also mean additional training
burdens and more problems of communication and management. Some activities cannot be
easily broken into tasks for numerous individuals; some aspects of computer programming
provide notable examples. Indeed, software programming can be so perverse that examples exist
of additional workers resulting in slower project completion. See F.P. Brooks, jr. , The Mythical
Man-Month, Addison Wesley, Reading, MA 1975. Back

7. For a discussion of solution procedures and analogies of the general function time/cost
tradeoff problem, see C. Hendrickson and B.N. Janson, "A Common Network Flow Formulation
for Several Civil Engineering Problems," Civil Engineering Systems, Vol. 1, No. 4, 1984, pp.
195-203. Back

8. This example was abstracted from work performed in Houston and reported in U. Officer,
"Using Accelerated Contracts with Incentive Provisions for Transitway Construction in
Houston," Paper Presented at the January 1986 Transportation Research Board Annual
Conference, Washington, D.C. Back

9. This description is based on an interactive scheduling system developed at Carnegie Mellon

University and described in C. Hendrickson, C. Zozaya-Gorostiza, D. Rehak, E. Baracco-Miller
and P. Lim, "An Expert System for Construction Planning," ASCE Journal of Computing, Vol. 1,
No. 4, 1987, pp. 253-269. Back

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