Project Management Assignment 2: Crashing Analysis for MBA Students

This assignment analyzes a project network diagram, focusing on project crashing techniques to optimize project duration and cost. The solution identifies the critical path (ABEG) and calculates the duration of various paths. It details the crashing of activities B, D, E, F, and G, and determines the total cost after crashing. The analysis includes the impact of a bonus for early completion, evaluating different crashing scenarios to find the most acceptable and optimum cost. The final analysis suggests crashing only activity E to complete the project one day earlier than the expected duration, considering the incremental costs associated with crashing activities and bonus for early completion. The assignment covers critical path methodology, crashing activities, and cost optimization strategies within project management.

PROJECT MANAGEMENT

TABLE OF CONTENTS
Question: 1.......................................................................................................................................3
Question: 2.......................................................................................................................................4

Question: 1
The various path to complete the project is as follows:
ABEG = A + B + E + G = 5 + 8 + 3 + 9 = 25
ACEG = A + C + E + G = 5 + 2 + 3 + 9 = 19
ACFG = A + C + F + G = 5 + 2 + 4 + 9 = 20
ADFG = A + D + F + G = 5 + 6 + 4 + 9 = 24
On the basis of above calculation of various path, it is identified that ABEG is a critical
path as it has longest duration i.e., 25 days out of all alternative. It is because in the project
management, the path which take longest time to complete the particular project is considered as
critical path.
Activity Normal time Normal cost Crash time
Allowable
crash time
Crash
cost
Crash cost
per day
A 5 300 5 0 300 NA
X (No
crashing
possible)
B 8 250 5 3 400 50
C 2 100 2 0 100 NA
X (No
crashing
possible)
D 6 300 3 3 600 100
E 3 150 2 1 300 150
F 4 275 3 1 300 25
G 9 700 8 1 900 200
2075 2900
Project
Duration Activity / ies Crashed
Incremental cost of
crashing
Cumulative crash
cost
25 _ 0 0
24 B 50 50

23 B&F 75 125
22 B&D 150 275
21 G 200 475
20 D&E 250 725
Total cost of the project post crashing all the activities = 2075 + 725 = 2800.
Question: 2
After performing project crashing, it has been realized that only activities B, D, E, F and G can
be crashed. Accordingly, it can be said that the project could be finished earlier by 5 days that is i
just within the duration of 20 days as against the expected duration of the project determined
through critical path method.
Also, for finishing project earlier by one day, there will be an additional cost of $125 per day
which would be amounted to 125 * 5 = 625 for the difference in the duration of 5 days between
the expected duration and duration determined after crashing the activities of project.
Accordingly, the combination of cumulative cost of crashing, bonus associated with earlier
completion of project and normal cost of the project would be amounted to 2075 + 625 + 725 =
3425.
After investigating through the cost of the project, it has been found that there is an increase of
cost of the project would be 65%.
Therefore, only activity E would be crashed and the project would be completed just 1
day before the expected duration of the project that within 24 days. Accordingly, the most
acceptable and optimum cost of the project would be amounted to 2075 + 125+ 300 = 2500.