SCHEDULING

RESOURCES AND
COSTS (CHAPTER 8 )

Dr. Mohamad al masarwah

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LEARNING OBJECTIVES:
• Overview of the Resource Scheduling Problem
• Types of Resource Constraints
• Classification of a Scheduling Problem
• Resource Allocation Methods
• Computer Demonstration of Resource-Constrained Scheduling
• Splitting Activities

• Benefits of Scheduling Resources

• Assigning Project Work
• Multiproject Resource Schedules
• Using the Resource Schedule to Develop a Project Cost Baseline

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• This chapter completes the final two planning tasks that become the master plan for your project
resource and cost scheduling.

• If all projects and their respective resources are computer scheduled, the feasibility and impact of
adding a new project to those in process can be quickly assessed.

• The project manager uses the same schedule for implementing the project. If changes occur during
project implementation, the computer schedule is easily updated and the effects easily assessed.

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OVERVIEW OF THE RESOURCE SCHEDULING
PROBLEM
• Project manager listed the following questions that still needed to be addressed:
• Will the assigned labor and/or equipment be adequate and available to deal with my project?
• Will outside contractors have to be used?
• Do unforeseen resource dependencies exist? Is there a new critical path?
• How much flexibility do we have in using resources?
• Is the original deadline realistic?

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OVERVIEW OF THE RESOURCE SCHEDULING PROBLEM

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OVERVIEW OF THE RESOURCE SCHEDULING PROBLEM

• Resource smoothing: resources are adequate but the demand varies widely over the life of the
project, it may be desirable to even out resource demand by delaying noncritical activities (using
slack) to lower peak demand and, thus, increase resource utilization.
• Resource constrained scheduling : resources are not adequate to meet peak demands, the late start of
some activities must be delayed, and the duration of the project may be increased.

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THE CONSEQUENCES OF FAILING TO SCHEDULE
LIMITED RESOURCE:
1) are costly and project delays usually manifest themselves midway in the project when quick
corrective action is difficult.

2) ignoring the peaks and valleys of resource usage over the duration of the project.

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TYPES OF RESOURCE CONSTRAINTS:
1) People: this is the most obvious and important project resource.

2) Materials: project materials cover a large spectrum: for example, chemicals for a scientific project,
concrete for a road project, survey data for a marketing project.

3) Equipment: is usually presented by type, size, and quantity. In some cases equipment can be
interchanged to improve schedules, but this is not typical.

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CLASSIFICATION OF A SCHEDULING PROBLEM :

• Time-constrained project: is one that must be completed by an imposed date. If required, resources
can be added to ensure the project is completed by a specific date. Although time is the critical
factor, resource usage should be no more than is necessary and sufficient.

• Resource-constrained project: is one that assumes the level of resources available cannot be
exceeded. If the resources are inadequate, it will be acceptable to delay the project, but as little as
possible.

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 RESOURCE ALLOCATION METHODS

Assumptions
- splitting activities will not be allowed
- the level of resources used for an activity cannot be changed.

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TIME-CONSTRAINED PROJECTS: SMOOTHING RESOURCE DEMAND
 Scheduling time-constrained projects focuses on resource utilization, when demand for a specific
resource type is erratic, it is difficult to manage, and utilization may be very poor.

 All leveling techniques delay noncritical activities by using positive slack to reduce peak demand
and fill in the valleys for the resources.

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BOTANICAL GARDEN (EXAMPLE)
• The top bar chart shows the activities on a
time scale. The dependencies are shown with
the vertical connecting arrows. The horizontal
arrows following activities represent activity
slack (for example, irrigation requires six days
to complete and has six days slack).
• The number of backhoes needed for each task
is shown in the shaded activity.
• The middle chart shows the resource profile
for the backhoes. For periods 4 through 10,
four backhoes are needed.

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THE BOTANICAL GARDEN PROJECT SCHEDULE
REACHED THE THREE GOALS OF SMOOTHING:
1) The peak of demand for the resource was reduced.

2) Resources over the life of the project have been reduced.

3) The fluctuations in resource demand were minimized.

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RESOURCE CONSTRAINED PROJECTS
• The parallel method is the most widely used approach to apply heuristics, which have been found to
consistently minimize project delay over a large variety of projects.

• The parallel method is an iterative process that starts from the beginning of project time and, when
resources needed exceed the resources available, retains activities first by the priority rules:
1) Minimum slack.
2) Smallest duration.
3) Lowest activity identification number.

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COMPUTER DEMONSTRATION OF RESOURCE-
CONSTRAINED SCHEDULING
• We will use the EMR project to demonstrate how this is done using MS Project, It is important to
note that the software is not “managing” the project.

• The software is simply a tool the project manager uses to view the project from different
perspectives and conditions.

• EMR is the name given to the development of a handheld electronic medical reference guide to be
used by emergency medical technicians and paramedics.

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• The number of engineers required to perform each
task is noted in the network, where 500 percent
means five design engineers are needed for the
activity. For example, activity 5, feature specs,
requires four design engineers (400 percent). The
project begins January 1, and ends February 14, a
duration of 45 workdays.

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• The time-limited (constrained)
bar chart for the project is shown
in Figure 8.7. This bar chart
incorporates the same
information used to develop the
project network, but presents the
project in the form of a bar chart
along a time line.

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• Figure 8.8A observe that the time-limited
project requires 21 design engineers on January
18 and 19 (168 hrs/8 hrs per engineer =21
engineers).

• Figure 8.8B is a resource loading chart for

design engineers. Notice that the peak is 21
engineers and the limit of 8 engineers is shown
by the gray shaded area.

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• Figure 8.9 the resource-limited project
network indicates the project duration
has now been extended to 2/26, or 57
workdays (versus 45 days time
limited),the critical path is now 2, 3, 9,
13.

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• Figure 8.10 presents the project
bar chart and the results of
leveling the project schedule to
reflect the availability of only
eight design engineers.

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• Compare the bar chart in Figure 8.10 with the time-limited bar chart in Figure 8.7. For example,
note the different start dates for activity 8 (screen). In the time-limited plan (Figure 8.7), the start
date for activity 8 is 1/18, while the start date in the resource limited schedule (Figure 8.10) is 2/16,
almost a month later.

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THE IMPACTS OF RESOURCE-CONSTRAINED SCHEDULING

1) Reduces delay and flexibility.

2) Increases criticality of events.
3) Increases scheduling complexity.
4) May make traditional critical path no longer meaningful.
5) Can break sequence of events.
6) May cause parallel activities to become sequential and critical activities with slack to become
noncritical.

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SPLITTING ACTIVITIES
Splitting is a scheduling technique used to get a better project schedule and/or to increase resource
utilization.
• Involves interrupting the work and sending the resource to another activity for a period of time and
then having the resource resume work on the original activity.
• Can be a useful tool if the work involved does not include large start-up or shutdown costs.
• The propensity to deal with resource shortages by splitting is a major reason why projects fail to
meet schedule.

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• Figure 8.11 depicts the nature of the
splitting problem, the original activity
has been split into three separate
activities: A, B, and C.
• The shutdown and start-up times
lengthen the time for the original
activity.

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BENEFITS OF SCHEDULING RESOURCES
1) Provide the information needed to prepare time-phased work package budgets with dates.

2) Once established, they provide a quick means for a project manager to gauge the impact of
unforeseen events such as turnover, equipment breakdowns, or transfer of project personnel.

3) Allow project managers to assess how much flexibility they have over certain resources.

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ASSIGNING PROJECT WORK
• Factors need to be considered in deciding who should work together:
1) Minimize unnecessary tension, managers should pick people with compatible work habits and
personalities but who complement each other.
2) Experience is another factor, Veterans should be teamed up with new hires—not only so they can
share their experience but also to help socialize the newcomers to the customs and norms of the
organization.
3) Future needs should be considered.

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MULTIPROJECT RESOURCE SCHEDULES
• The following lists three of the more common problems encountered in managing multiproject resource
schedules:
1) Overall project slippage :
delays in one project can have a ripple effect and delay other projects.
2) Inefficient resource utilization :
Because projects have different schedules and requirements, there are peaks and valleys in overall
resource demands.
3) Resource bottlenecks :
Delays and schedules are extended as a result of shortages of critical resources that are required by multiple
projects.

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WHY A TIME BASED BUDGET BASELINE IS NEEDED
• Example

The development of a new product is to be completed in 10 weeks at an estimated cost of $400,000 per week for a
total cost of $4 million. Management wants a status report at the end of five weeks. The following information has
been collected:

• Planned costs for the first five weeks are $2,000,000.

• Actual costs for the first five weeks are $2,400,000.
Assume another set of data at the end of five weeks:
• Planned costs for the first five weeks are $2,000,000.
• Actual costs for the first five weeks are $1,700,000.
Without time-phasing cost to match your project schedule, it is impossible to have reliable information for
control purposes.

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CREATING A TIME –PHASED BUDGET
• From the development of your work breakdown structure for each work package, the following
information needed to be developed:
• 1. Define work (what).
• 2. Identify time to complete a work package (how long).
• 3. Identify a time-phased budget to complete a work package (cost).
• 4. Identify resources needed to complete a work package (how much).
• 5. Identify a single person responsible for units of work (who).
• 6. Identify monitoring points for measuring progress (how well).

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• Figure 8.12 for example, at the
intersection of the Read/write head
deliverable and the Production
department we see there are three work
packages with a total budget of $200,000.
The sum of all cost accounts in a column
should represent the total costs for the
deliverable. Conversely, the sum of the
cost accounts in a row should represent
the costs or budget for the organizational
unit responsible to accomplish the work.

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• Figure 8.13 the work package has a duration of
three weeks. Assuming labor, materials, and
equipment are tracked separately, the work
package costs for labor are distributed over the
three weeks as they are expected to occur—
$40,000, $30,000, and $50,000 for each week,
respectively. When the three-week work package
is placed in the network schedule, the costs are
distributed to the time-phased budget for the same
three scheduled weeks.

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• Figure 8.14, this activity includes two WPs.
The first, WP-1.1.3.2.4.1 (Code), is
distributed over the first three weeks. The
second, WP-1.1.3.2.4.2 (Integration), is
sequenced over weeks 3 and 4. The activity
duration is four weeks. When the activity is
placed in the schedule, the costs are
distributed starting with the schedule start—
$20,000, $15,000, $75,000, and $70,000,
respectively.

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• Figure 8.15 shows the Patient Entry Project network
schedule, which is used to place the time-phased work
packages’ budgets in the baseline.

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• Figure 8.16 presents the project time-phased budget for
the Patient Entry Project and the cumulative graph of
the project budget baseline. In this figure you can see
how the time phased work package costs were placed
into the network and how the cumulative project budget
graph for a project is developed. Notice that costs do
not have to be distributed linearly, but the costs should
be placed as you expect them to occur.

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• With your project budget baseline
established, you are also able to
generate cash flow statements for
your project like the one presented in
Figure 8.17.

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• Finally, with resource assignments
finalized you are able to generate
resource usage schedules for your
project Figure 8.18.

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