Project Management

Chapter 6

Resource Allocation

6-2

Resource Allocation

Activities compete with one another and Projects compete with one another for resources

Allocate scarce recourses to competing activities in an efficient way. Material Human Resources Capital Resources- i.e. equipment

Resource allocation requires trade-offs time constraint resource constraint Performance constraint

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Resource Loading

1. For each resource

2. For each time period: Determine the total resource time required by all activities

3. If total Time Required < Capacity Go to 2

4. Re-schedule some activities to eliminate resource overloading in that time period

5. Delay activities that have slack time first; No impact on CP

6. If that doesn’t work, then delay one or more critical activity

7. Go to 1

6-4

Resource Loading/Leveling and Uncertainty

28,282 Hours Needed during the next 34 weeks

Group Capacity21 (people) 40 (hours/week) 34 weeks = 28,560 labor hours

Correction for Holidays21 (people) 3 (days) 8 (hours) = 504 labor hours

Vacations11 (people) 2 (weeks) 40 (hours) = 880 labor hours

Hours Available28,560 - 504 - 880 = 27,176

about 1100 less than needed

28,282/27176 = 1.04, or 104% of capacity

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6-5

Resource Loading/Leveling and Uncertainty

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6-6

Allocation Priority Rules

As soon as possible: Standard rule in scheduling. Activities are scheduled to start on their ESTs

As late as possible: Activities start on their LSTs whenever possible without increasing the project’s duration

Shortest task duration first: Consistent with technological precedence's,

Minimum slack first: Tasks are supplied with resources in inverse order of their slacks

Most critical followers: Activities with a higher number of critical successors take precedence

Most successors: Same as previous rule except all successors are counted

Most resources first: The greater the use of a specific resource on a task, the higher the task’s priority for the resource

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6-7

Standards to Measure Schedule Effectiveness

Schedule Slippage The difference between actual completion date and the planned date Slippage may cause penalties Expediting one project can cause others to slip Taking on a new project can cause existing projects to slip

Resource Utilization The percentage of a resource actually used We prefer balanced utilization among most of the resource types

In-Process Inventory The volume of work waiting to be processed because there is a

shortage of some resource Similar to WIP in manufacturing The cost here is holding cost of the resources waiting

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Assignments

Review Questions: 1,3,4,5,8

Discussion Questions: 12,13,14,18

Problems: 23

Cases: 1 St. Dismas -4

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