Operational Research (or) Case/Problem Solution

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Operational Research (OR)

DR. SUPRIYA KUMAR DE

ASSIGNMENT

XLRI-PGCBM-18

NAME: GH. RASOOL WANI

SMS ID: 2217429

Table of Contents

1.Problem:1

2.Solution:2

2.1Manual Approach2
2.2Linear programming approach2
2.2.1Decision Variables:3
2.2.2Objective Function:3
2.2.3Constraints:3
2.3Excel Solution.6
2.3.1Excel Solution Embedded:6

3.Analysis:6

3.1Sensitivity Analysis: Objective Function6
3.2Sensitivity Analysis: Right Hand Side of the constraints7

Problem:

Mr. Ramesh Chandra is a Software Development Project Manager in one of the renowned Indian Software Services Company, namely “ABC Technologies”. The company’s business division has recently won a project from a major European telecom company. This Project is very important for the “ABC Technologies” as it is first time the company is entering in the telecom sector for the software services.

The “ABC Technologies” has been given whole end to end responsibility for this software package from Requirement Analysis till final Deployment.

Customer has communicated recently to the business director of “ABC Technologies” that they would like to see the final Project Plan with a Breakdown of the tasks, Total Cost of the Project and Total duration of the Project by end of next week.

“ABC Technologies” management has decided to assign Ramesh Chandra as the Project Manager for this Project and has been told to come up with the Project Plan so that they can share it with the Customer by end of next week. Ramesh has already been provided with all the required inputs so that he can be prepared for the plan.

Mr. Ramesh worked very hard and came up with the following plan.

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Table-1: Initial Plan

Durations and Effort are here in Person Days (pdays).

AS per this plan, Activities/Tasks A-B-C-D-E-F-H-I-L-M are on Critical Path and the Project duration comes to 64 days.

The Total Cost of the Project comes to $20,000.

During the plan discussion with the customer, customer commented that the duration of 64 days for this project is not acceptable to them and they would like the project duration be reduced by at least 20 days with a very minimal extra cost impact.

Ramesh agreed during the meeting that he would try to reduce the duration and will come up with the new plan in a couple of days.

Solution:

Being a Project Manager, Ramesh knows that Project time cam be reduced by a technique called Crashing which takes care to reduce the duration on a minimal extra cost.

To start the Crashing, Ramesh needs to know how much time each activity can be crashed to and how much it will cost. He starts this activity and comes with the following analysis for each activity.

Durations and Effort are here in Person Days (pdays).

[pic]

Table-2: Plan with Crash Time and Crash Cost against each activity.

There are two approaches to the problem:

1 Manual Approach

For crashing project time, the first task is to identify the normal critical path and the critical activities. Then it is required to determine the crash cost per time period (cost-time slopes) for various activities. The cost-time slopes can be computed using the following formula:

Crash Cost – Normal Cost
Slope = -------------------------------------- Normal Time –Crash Time

The next step is to identify the activity on the critical path with the smallest crash cost per time period. This activity will be crashed to the maximum possible extent or to the point at which management’s desired deadline has been reached.

Then it should be checked that the critical path that were being crashed is still critical. If the path is still critical then crash the activity that has second lowest cost-time slopes and continue this process until the goal has been reached. If, a reduction in a critical activity time causes a...
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