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CONSIDERING TIME–COST TRADE-OFFS 401

a. Develop a project network.
b. Develop an activity schedule.
c. What are the critical activities, and what is the expected project completion time?
d. Assume that the company wants to complete the project in six months or 26 weeks.
What crashing decisions do you recommend to meet the desired completion time at the
least possible cost? Work through the network and attempt to make the crashing
decisions by inspection.
e. Develop an activity schedule for the crashed project.
f. What added project cost is required to meet the six-month completion time?

CASE PROBLEM R.C. Coleman

.C. Coleman distributes a variety of food products that are sold through grocery store and supermarket
R outlets. The company receives orders directly from the individual outlets, with a typical order requesting the
delivery of several cases of anywhere from 20 to 50 different products. Under the company’s current warehouse
operation, warehouse clerks dispatch order-picking personnel to fill each order and have the goods moved to the
warehouse shipping area. Because of the high labour costs and relatively low productivity of hand order-picking,
management has decided to automate the warehouse operation by installing a computer-controlled order-picking
system, along with a conveyor system for moving goods from storage to the warehouse shipping area.
R.C. Coleman’s director of material management has been named the project manager in charge of the
automated warehouse system. After consulting with members of the engineering staff and warehouse
management personnel, the director compiled a list of activities associated with the project. The optimistic,
most probable and pessimistic times (in weeks) have also been provided for each activity.

Activity Description Immediate Predecessor
A Determine equipment needs —
B Obtain vendor proposals —
C Select vendor A, B
D Order system C
E Design new warehouse layout C
F Design warehouse E
G Design computer interface C
H Interface computer D, F, G
I Install system D, F
J Train system operators H
K Test system I, J

Activity Optimistic Time Most Probable Pessimistic

A 4 6 8
B 6 8 16
C 2 4 6
D 8 10 24
E 7 10 13
F 4 6 8
G 4 6 20
H 4 6 8
I 4 6 14
J 3 4 5
K 2 4 6

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