Net work Analysis/Critical Path Analysis (L1) Learning Objective – Understand CPA Learning Outcomes - By the end of the lesson students should be able to: Calculate earliest start times and latest finish times Explain what a float is in relation to CPA Assess the value of CPA

Starter activity Business Quiz - ness-studies/C173/ ness-studies/C173/

What is the critical path? The sequence of project activities which add up to the longest overall duration The critical path determines the shortest time possible to complete the project The sequence of project activities which add up to the longest overall duration The critical path determines the shortest time possible to complete the project

The need to plan complex projects Many larger businesses get involved in projects that are complex and involve significant investment and risk As the complexity and risk increases it becomes even more necessary to identify the relationships between the activities involved and to work out the most efficient way of completing the project

Information needed for CPA A list of all activities required to complete the project The time (duration) that each activity will take to completion The dependencies between the activities (e.g. activity D cannot be completed until activity B&C done)

CPA calculates… The longest path of planned activities to the end of the project The earliest and latest time that each activity can start and finish without making the project longer Which activities are "critical" (i.e. on the longest path) and which have "total float" (i.e. can be delayed without making the project longer)

Why is the critical path so important? Any delay of an activity on the critical path directly impacts the planned project completion date (i.e. there is no float on the critical path)

Class activity Question 1 page 348 of Hall

Answers a) = 47 minutes b)Yes the minimum would be 43 minutes – = 43 minutes

Example: Putting flat back furniture together Ever done this?? Instructions show the best way to build furniture. A slots into B etc. Meanwhile someone else can be gluing C and D

Activity Read and complete the CPA worksheet (DIFF)

Net work Analysis/Critical Path Analysis (L2) Learning Objective – Understand CPA Learning Outcomes - By the end of the lesson students should be able to: Calculate earliest start times and latest finish times Explain what a float is in relation to CPA Assess the value of CPA

Activity Question 2 page 350 of Hall

Task Use pages of the A Level textbook to make notes on CPA Ext - Analyse the advantages and disadvantages of CPA

Benefits and Drawbacks of CPA AdvantagesDisadvantages Most importantly – helps reduce the risk and costs of complex projects Reliability of CPA largely based on accurate estimates and assumptions made Encourages careful assessment of the requirements of each activity in a project CPA does not guarantee the success of a project Help spot which activities have some slack (“float”) and could therefore transfer some resources = better allocation of resources Resources may not actually be as flexible as management hope when they come to address the network float A decision-making tool and a planning tool – all in one! Too many activities may the network diagram too complicated. Activities might themselves have to be broken down into mini-projects Provides managers with a useful overview of a complex project Links well with other aspects of business planning, including cash flow forecasting and budgeting

Advantages Requires careful planning improving the smooth operation of an important project. Identifies events that can be carried out simultaneously. The resources needed for each activity can be ordered no earlier than their EST. (JIT) If any delays occur, the network diagram is a good place to start when deciding appropriate actions.

Disadvantages A complex project can mean that drawings can become unmanageable. Does not, in itself, ensure the effective management of a project. The value of the network reduced slightly because the activity lines are not in proportion to duration.

Extension/Homework Case study – Newport Holdings page 353 of the Hall A Level textbook

Net work Analysis/Critical Path Analysis (L3) Learning Objective – Understand CPA Learning Outcomes - By the end of the lesson students should be able to: Calculate earliest start times and latest finish times Explain what a float is in relation to CPA Assess the value of CPA

Calculating the FLOAT ActivityLFTEST Duration Total FLOAT A AA140 0 B Total FLOAT = the amount of spare time available for an activity without delaying the whole project Question – What does this mean? FLOAT= LFT – (EST+ Duration)

What does this mean? This data tells us: Activity A can be delayed 2 weeks without delaying the whole project Activity AA is CRITICAL  any delay will hold up the project Activity B is CRITICAL ActivityLFTEST Duration Total FLOAT A AA140 0 B171430

CPA and Lean Production Lean production aims to reduce wastage and thereby make a business more efficient and competitive. Two operational strategies based on CPA to achieve Lean Production:  Kaizen (continuous improvement)  JIT – Just In Time production

Kaizen Employees attempt to improve what they do in some small way every day Small regular contributions from the whole firm can have big cumulative effects

JIT Holding stock increases costs:  Warehousing, breakages, capital JIT aims to minimise the stocks held at any point of the production process: Raw Materials and components Work in progress (unfinished goods) Work in progress (unfinished goods) Finished goods

CPA – Application and Analysis Read and complete the January 2013 exam paper Q1 OR Read and complete the June 2010 exam paper Q3 Homework – Self assessment using the mark scheme