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A2 Operations Management

A2 Operations Management. Critical Path Analysis. How long will it take?.

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A2 Operations Management

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  1. A2 Operations Management Critical Path Analysis

  2. How long will it take? • Walls have decided to launch a new Magnum ice cream. Machine delivery will take 9 weeks, installation takes 5 weeks, staff recruitment 4 weeks and training a further week. Suppliers need 2 weeks lead time and the trial production run will take 2 weeks. • How long until the new magnums will be in the retailers fridges? • Answers? • 22 weeks? • Longer? • Shorter?

  3. Prepare a grid.

  4. Answer

  5. Critical Path Analysis • The process of planning the sequence of activities in a project in order to discover the most efficient and quickest way of completing it. • Widely used in industries such as construction where it is possible to operate a range of activities in parallel • By mapping out the network of different activities firms can see which activities can be run at the same time • It also allows firms to see which activities can not be delayed without holding up the overall project

  6. Critical Path Analysis involves constructing a network diagram. • A node denotes the start and finish of an activity. It is split into 3 sections • An arrow represents an activity which is labelled and put above the arrow. Each activity has a duration which is put underneath the arrow. Earliest start time (EST) that an activity can commence and depends on the completion of the previous activity Number of the node. Provides a unique identity 1 Latest finishing time (LFT) of the previous activity without delaying the next activity A 5 days

  7. This diagram represents a project with four activities - A,B,C and D. D can not start until C has been completed. B C A D 1 2 3 4

  8. Student activity • Draw a network using the following information: A,B and C begin together. D follows A, E follows B, F follows C and E.

  9. Answer A D B E F C

  10. Constructing a critical path network • Prerequisite - the activity that must be completed before our selected activity can occur. E.g. digging foundations for a house before building the walls

  11. Constructing a critical path network • Step 1: Draw a node to represent the start of the network. All networks must start and end with a node. Do not draw a node at the end of an activity line immediately, ensure it is right first. A node represents the point at which a new activity can begin. • Step 2: Identify activities with no prerequisites. Draw lines from left to right from node 1. • Step 3: Label activity lines with description and duration • Step 4: Move onto the first activity with a prerequisite. Place a node at the end of the line and draw the next activity which is reliant on the previous activity being completed. • Step 5: Repeat steps 3 and 4 until complete. Then calculate the ESTs and LFTs. Then the critical path can be established.

  12. Constructing the Critical Path Analysis • Earliest starting time (EST) - Move forward through the nodes and always pick the largest of the options. Work right choosing the highest option for each node. • Latest finishing time (LFT) - move back from the final node and always pick the smallest of the options. Work left choosing the lowest option for each node.

  13. The Critical Path • The sequence of activities that cannot be delayed without delaying the overall completion of the project. • It is represented by activities that have identical LFTs and ESTs and it is the longest path between nodes.

  14. Student activity - Complete the critical path analysis for the following project. Identify the critical path.

  15. A 5 B B D C 7 9 0 3 2 3 4 1 7 9 0 3 2 3 3 4 D C 2 4 Answer The critical path is B, C, D

  16. Tips • Always ask your self the question: What activity can I do next? • A node is like a full stop. It must go at the end of an activity, it does not represent an activity

  17. Critical path analysis - Lesson 2 - Recap • Critical path analysis is a way of showing how a lengthy and complex project (e.g. a building project, marketing campaign) can be completed in the shortest possible time. • It shows which of the activities are ‘critical’ - this means that if these activities are delayed, then the project will not be able to be completed on time.

  18. Student Activity - Produce a critical path for the following project. Identify the critical path.

  19. Node 1 always start with anESTof zero and should have anLFTof zero Answer • Step 1 - Draw the activities and nodes in the correct order • Step 2 calculate the ESTs and LFTs • EST - Earliest the next activity can begin • LFT - latest finishing time that the previous activity can finish without delaying the next activity LFT = work backwards subtracting the activity from the previous LFT if there is an option choose the smallest value EST= Previous EST plus activity length (between node 1 and 2: 0 + 6 = 6) EST F A B 0 G 6 14 19 21 1 2 4 5 6 0 6 7 6 15 4 2 19 21 C D 5 3 LFT E 3 11 If you have a choice between two different EST values as at node 4 choose the biggest 11 8

  20. Step 3 - Label the Critical Path • The critical path is the sequence of activities that cannot be delayed without delaying the overall project completion. • It is represented by the activities with identical ESTs and LFTs and the longest path between the nodes • The critical path for the previous example would be: • Critical path A,C,E,G • On the diagram the critical path activities will be symbolised with two lines through the activity line

  21. Float Times • Float time - the amount of time that non-critical activities within a project can be delayed without affecting the deadline for completion of the whole project. • Total float for an activity- the amount of time an activity can be delayed without delaying the whole project • Total Float for an activity= LFT -EST - duration of the activity • E.g. Activity D = 15 - 11 - 3 = 1 day • Therefore the activity may be delayed by 1 day without affecting the whole project

  22. Critical Path Analysis • Produce a critical path network for the following Marketing campaign. Calculate the EST, LFT, critical path and total float for each activity A

  23. 0 3 2 1 0 3 B D 8 3 21 10 5 3 13 21 Calculating float times Float for the activity = LFT – EST - Duration Float for this activity = 3 – 3 - 0 = 0 Float for this activity = 21 – 10 - 8 = 3

  24. Float times for Marketing strategy activity • A = 4 - 0 - 4 = 0 • B = 13 – 4 – 6 = 3 • C = 11 – 7 – 4 = 0 • D = 21 – 13 – 8 = 0 • E = 21 – 11 – 10 = 0 • F = 30 – 21 – 9 = 0 • G = 35 – 30 – 5 = 0

  25. Student Activity • Complete the exam question 2 a) for January 2005 Unit 4 exam paper

  26. Answer January 2005 Question 2a)

  27. Problems of using CPA • Can encourage rigidity • If every activity is strictly time-tabled a delay in a critical activity may result in a greater overall delay • CPA focuses on speed of completion rather than quality • CPA relies on estimated completion times • Complex projects may be difficult to produce • Sub-contractors are outside of the firms control and may not stick to deadlines • Supplies may be delayed

  28. Business Implications of Critical Path Analysis • Read and highlight the information on the business implications of using CPA • Complete questions 1 and 2 on the information sheet • For both critical path questions calculate all ESTs, LFTs, the critical path and the float time of each activity

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