1. Accelerating the project Edina Nagy Lajos Kiss Szabolcs Hornyák

2. Overview Introduction Project acceleration terminology  Normal Time, normal cost  Crash Time, crash cost  Direct Costs  Indirect Costs  Total Project Cost  Optimum Project Duration Project acceleration principles References Introduction Project acceleration terminology  Normal Time, normal cost  Crash Time, crash cost  Direct Costs  Indirect Costs  Total Project Cost  Optimum Project Duration Project acceleration principles References

3. „When I know all information, only can make a right decisions.” Paulo Coelho Introduction

4. Steps of right decision:  Definiate: Time and costs  Analysed the possibilities  Compare the opportunities  Choose the best way Steps of right decision:  Definiate: Time and costs  Analysed the possibilities  Compare the opportunities  Choose the best way Introduction

5. Project acceleration terminology Normal Time, normal cost This is the usual time that would be needed to carry out the electrical services work under normal circumstances, estimated at 12 days with a cost of £10.000.

6. Project acceleration terminology Crash Time, crash cost The crash time is the maximum time the operation can be compressed by increasing the resources. Crash time: 8 days Crash cost: £18.000

7. Project acceleration terminology Cost Slope

8. Project acceleration terminology Activity ranking Analysed the precedence relationship Identified the critical activities Ranking by the cost Reduce the duration Define the critical path

9. Project acceleration terminology Direct costs: Labour Plants Materials Subcontractors Overheads and profit

10. Project acceleration terminology Indirect costs: Project supervision Site hutting and accomodation Site office telephones, heating and lighting Vans and site transport

11. Project acceleration terminology Direct costs + Indirect costs Total cost

12. Optimum project duration

13. Project acceleration principles Example – based on a network arrow diagram

14. Project acceleration principles Project datas PROJECT DATA ActivityNormal TimeNormal CostCrash TimeCrash Cost A612 000420 000 B824 000448 000 C318 000220 000 D618 000424 000 E636 000454 000 F1010 000650 000 G520 000330 000 H840 000650 000 I220 0002 Summation£198 000 Indirect costs £2000 per week

15. Project acceleration principles Normal time / Normal Cost analysis

16. Project acceleration principles Normal time / Normal Cost analysis Cost Slope Assessment ActivityNormal TimeCrash TimeSaving in Time Normal Cost (£000) Crash Cost (£000) Increase in Cost (£000) Cost SlopeFloatOrder/ Ranking A642122084000Zero2nd E6423654189000Zero3rd F1064 504010000Zero4th D642182463000Zero1st B84424482460005 Non critical operations G53220301050003 H86240501050003 I22020 005 C3211820220005

17. Project acceleration principles Revised arrow diagram

18. Project acceleration principles Activity Normal Time (weeks) Crash Time (weeks) Reduction in Time (weeks)Cost slope (£) Increase in direct cost (£) D64230006000 A64240008000 E6519000 Reduction in overall time = 5 Increase in direct cost due to this reduction in time = 23000 Total Project Costs at week 23. Direct costs =£198 000 + £23 000 =£221 000 Indirect costs =23 weeks x £2 000 =£46 000 Total Project Cost £267 000 Therefore, in order to achieve an acceleration of 5 weeks, the project cost will be increased by £13 000, that is: Crash Cost =£267 000 Less Normal Cost =£254 000 Acceleration Cost =£13 000 Reduction in project period

19. References - pp. 186-196 Paragraph 9.9 Accelerating the project

20. Thanks…