INSE 6230: Assignment 1 - Winter (0% of final grade) 1. The table below provides information about a short IT project.

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1 INSE 6230: Assignment - Winter 208 (0% of final grade). The table below provides information about a short IT project. Activity Predecessors Duration (Months) A - 2 B - 3 C A 4 D A, B 2 E D 2 F B, C, E 3 A. Draw an AOA network diagram for this project. A C 4 F 5 0 X Y E B 2 3 D B. Find the critical path(s) in the network. Path Duration A-C-F 2+4+3=9 A-X-D-E-F =9 A-X-Y-F =5 B-D-E-F =0 B-Y-F 3+0+3=6 B-D-E-F is the longest path which would make it the critical path. Its duration is 0 months. INSE 6230 Winter 208 Assignment

2 C. Draw Gantt Chart for this project Task Name Start Date (Month Begin) Duration (Months) A 0 2 B 0 3 C 3 4 D 4 2 E 6 2 F 8 3 Months D. Consider the following situations: a. Activity A takes one month longer than planned. b. Activity B takes one month longer than planned. c. Activity C takes one month longer than planned. For each of the cases above, determine what happens: with the completion time of the project with the next (following) activity Situation Effect on completion Effect on next activity A (one month longer) It won t affect the whole project completion as it is not on the critical path Activity C s start date will be delayed for one day. Activity D is dependent on activity A but it is also dependent to B this delay is not greater than B s completion so there will be A (one month longer) B (one month longer) Two paths including activity A will become critical paths as well. (A-C-F,A-X-D-E-F) we will have three critical paths all with the duration of 0 months, the completion time won t change. This task is on the critical path, so the whole project will be delayed for one month no change in D s start Activity C s start date will be delayed for one month. Activity D is dependent on activity A but it is also dependent to B this delay is not greater than B s completion so there will be no change in D s start Activities D and F are depending on B. INSE 6230 Winter Assignment

3 B (one month longer) C (one month longer) C (one month longer) This task is on the critical path, so the whole project will be delayed for one month It won t affect the whole project completion as it is not on the critical path The ACF path will become the critical path with the duration of 0 months so the completion time doesn t change D will be delayed instantly and F will be delayed for the same amount consequently. Activities D and F are depending on B. D will be delayed instantly and F will be delayed for the same amount consequently. F is depending on C: C finish date is not later than E finish date so there will be no change to F start date F is depending on C: C finish date is not later than E finish date so there will be no change to F start date INSE 6230 Winter Assignment

4 2. Fill the AON network below based on the Start node pattern, i.e. calculate ES, LS, EF, LF, TF and FF. Indicate the critical path of the network. What is the project completion time? This network has 3 Critical paths: B-E-G-F, B-E-I-K, B-E-I-J The project completion time is 59 days. INSE 6230 Winter Assignment

5 3. Draw an AOA and AON networks for the project with the following activities. Activity Predecessors Min Most Likely Max A B C A, B D C E C F D G D, E AOA: A=5 0 B=7 X 2 C=3 4 F=3 D=5 3 Y 6 E=8 G=6 5 AON: A D F Start C End B E G INSE 6230 Winter Assignment

6 A. Use PERT method to calculate the mean and standard deviation of the project completion time. Expected project duration: E(T) = = days Variance: Standard deviation: Var(T) = =.33 σ =.33 =.5 B. Calculate the critical path with and without considering the 3-point estimation. Answer: The Critical Path is the same with and without considering 3-point estimation, therefore: B-C-D-F is the critical path and its duration is the project duration. The expected duration of the critical path is days 4. Consider a project that requires an initial investment of $50,000 in year 0. It has a duration of 7 years. For year to year 7, the labor cost and materials cost are each year are as follows: $0,000 per year and $5,000 per year, respectively. The annual benefit is $30,000 from year to year 7. The company uses a discount rate of 0%. Initial Investment = Duration 7 years Labor= 0000 /year Material= 5000 / year Annual benefit= /year Interest rate= 0. Year Costs Benefits Discount Factor Discounted Discounted Cumulative (Multiply to discount) Costs Benefits PV ( ) = ( ) = ( ) = ( ) = ( ) = INSE 6230 Winter Assignment

7 ( ) = ( ) = ( ) = Total A. Calculate NPV for this project. Based on the NPV criterion, would you recommend investing in this project? The NPV is positive so the investment is recommended based on the NPV criterion. B. If the company s required maximum payback period is 2 years, should this project be accepted? The first row where the cumulative NPV is a positive number is the 5 th year which means the breakeven point (NPV=0) is between 4 th and 5 th year which is further than 2 nd year (company s expectation), so the company should not accept this project. C. Calculate ROI for this project. ROI = NPV Total Cost = = 0.87 = 9% INSE 6230 Winter Assignment

8 5. The tasks of a project and the related data is given below. It is required to complete the project in 56 days at minimum possible cost. Activity Predecessors Duration Maximum number of days to crash Cost of crash per day A B C D A E A F C G C H E, B, F I E, B, F J H, D AOA: A. Draw the network for this project (AON or AOA) D A E H 4 0 B 2 J C F I 5 3 G AON: INSE 6230 Winter Assignment

9 A D J E H Start B End I F C G B. What is the critical path(s) and the project duration at this point? The critical path is C-F-H-J. The duration is 72 days C. Determine the critical path(s), the project duration and the additional project cost after each crashing step, and show the details about the activities you have crashed. Please, create a summary table of your crashing steps similar to the one below. Step Activity(-ies) to be crashed By how many days? For what additional cost? Project duration after this step Total additional project cost Critical path(s) after this step H C-F-H-J 2 C-F-H-J F A-D-J 3 C-F-H-J J A-D-J 4 C-F-H-J A & C 7 & 7 35 & A-D-J B-H-J A-D-J B-H-J INSE 6230 Winter Assignment

10 D. What is the final critical path(s), the project duration and the final additional project cost after the crashing? The final duration is 56 days The final additional cost for the project is 09 after crashing The following is a possible continuation of the problem (not required in the assignment): The project has reached the requested duration of 56 days. If, for any reason, further crashing is required there can be one additional crashing step: 5 A & B & C,, 5 & 7 & C-F-H-J A-D-J B-H-J The C-F-H-J cannot be crashed anymore and is the critical path so we cannot crash project anymore. The final duration is 55 days The final additional cost for the project is 26 after crashing INSE 6230 Winter Assignment

Project Planning. Identifying the Work to Be Done. Gantt Chart. A Gantt Chart. Given: Activity Sequencing Network Diagrams

Project Planning. Identifying the Work to Be Done. Gantt Chart. A Gantt Chart. Given: Activity Sequencing Network Diagrams Project Planning Identifying the Work to Be Done Activity Sequencing Network Diagrams Given: Statement of work written description of goals work & time frame of project Work Breakdown Structure Be able