Lecture Project management: A managerial approach – Chapter 9: Resource allocation

For single projects, we discuss how the resource allocation problem concerns resource leveling to minimize the cost of the resources. But for multiple projects, we learn that the issue is how to allocate limited resources among several projects in order to achieve the objectives of each.

Copyright 2015 John Wiley & Sons, Inc.

Chapter 9

Resource 

Allocation

by spending more money

 Crunching a project often introduces 

unanticipated problems

An Example of Two­Time CPM

Activity Slopes—Cost per Period for 

Crashing

Crashing the Project

Seven Day Schedule

Six Day Schedule

Five Day Schedule

Four Day Schedule

Cost­Crash Curve

Fast­tracking is another way to expedite a project

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scope are fixed

System­constrained: A project requires a fixed amount of time and resources

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Resource A

Resource B

Large projects with multiple resources are complex to levelize

Resource Leveling

Constrained Resource Scheduling

Heuristic

Approach An approach, such as a rule of thumb, that yields

a good solution that may

or may not be optimal

Optimization

Approach An approach, such as linear programming, that

yields the one best

solution

They are the only feasible methods used 

to attack large projects

While not optimal, the schedules are very good

Take the CPM/PERT schedule as a 

baseline

Multi­Project Scheduling and Resource  Allocation

Multi­Project Scheduling and Resource  Allocation  Continued

However, different projects have different goals so combining may not make sense

Must also tell us if there are resources to tackle the new projects we are 

considering

This is the amount of work waiting to be 

processed because there is a shortage of some resource

Similar to WIP in manufacturing

Holding cost is incurred

With multiproject instances a single case must be developed 

Connected with dummy activities and/or 

pseudoactivities

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Hierarchy of Gantt Charts

Do Early Finishes and Late Finishes  Cancel Out? So What? 

independent leads to underestimating the actual amount of time  needed to complete the project.

visible to project workers and is often misused.

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