Southwestern University Stadium Project

A PERT/CPM Case Study

Presented to

Ms. Emilina R. Sarreal of the Business Management Department,

De La Salle University - Manila

In partial fulfillment of the requirements in MANASCI

Submitted by

Garcia, Amanda Elise

Simbulan, Cyrene Pamela

Umaly, Isabella

Yu, Tedrick

K37

On

March 24, 2011

Southwestern University Stadium Construction

After six months of study, much political arm wrestling, and some financial analysis, Dr.

Martin Starr, president of Southwestern University, had reached a decision. To delight of its

students, and to the disappointment of its athletic boosters, SWU would not be relocating to a

new football site but would expand the capacity at its on-campus stadium.

Adding 21, 000 seats, including dozens of luxury skyboxes, would not please everyone.

The influential football coach, Bo Pitterno, had long argued the need for a first class stadium,

one with built in dormitory rooms for his players palatial office appropriate for the coach of

future NCAA champion team. But the decision was made, and everyone, including the coach,

would learn to live with it.

The job now was to get construction going immediately after the 2007 season ended. This

would allow exactly 270 days until the 2008 season opening game. The contractor, Hill

Construction(Bob Hill being an alumnus, of course), signed the contract. Bob Hill looked at the

tasks his engineers had outlined and looked President Starr in eye. ”I guarantee the team will be

able to take the field on schedule next year”, he said with a sense of confidence. ”I sure hope so”,

replied the Starr. ”The contract penalty of 10, 000 per day for running late is nothing compared

to what Coach Pitterno will do to you if our opening game with Penn State is delayed or

cancelled.” Hill, sweating slightly, did not respond. In football-crazy Texas, Hill Construction

would be mud if the 270-day target were missed.

Back in his office, Hill again reviewed the data. He then gathered his foreman. ”People, if

we’re not 75% sure we’ll finish this stadium in 270 days, I want this project crashed! Give me

the cost figures for a target date of 250 days-also for 240 days. I want to be early, not just on

time!”
Southwestern University Stadium Project

TIME ESTIMATES (DAYS)

ACTIVITY DESCRIPTION
PREDE- MOST CRASH/COST
OPTIMISTIC PESSIMISTIC
CESSORS LIKELY DAY(S)
Bonding, insurance, tax
A structuring - 20 30 40 1,500
Foundation, concrete footing
B for boxes A 20 65 80 3,500
Upgrading skyboxes, stadium
C seating A 50 60 100 4,000
Upgrading walkways,
D stairwells, elevators C 30 50 100 1,900

E Interior wiring, lathes B 25 30 35 9,500

F Inspection approvals E 1 1 1 0

G Plumbing D, E 25 30 35 2,500

H Painting G 10 20 30 2,000
Hardware/air conditioning/
I metal workings H 20 25 60 2,000

J Tile/carpeting/windows H 8 10 12 6,000

K Inspection J 1 1 1 0

L Final detail work/cleanup I, K 20 25 60 4,500

1. Develop a network drawing for Hill Construction and determine the critical path. How long

is the project expected to take?

2. What is the probability of finishing in 270 days?

3. If it were necessary to crash to 250 or 240 days, how would Hill do so, and at what costs? As

noted in the case, assume that optimistic time estimates can be used as crash times.
 Network drawing for Hill Construction:
F
Inspection
approvals

End
B E I
Foundation Interior Hardware/air
concrete wiring, conditioning/
footing for lathes metal workings
boxes

A G H L
Bonding, Plumbing Painting Final
insurance, detail
Start tax work/
structuring cleanup

C D J K
Upgrading Upgrading Tile/ Inspection
skyboxes, walkways, carpeting/
stadium stairwells, windows
seating elevators

PATHS TIME TOTAL TIME

ABEF 30+65+30+1 126
ABEGHIL 30+65+30+30+20+25+25 225
ABEGHJKL 30+65+30+30+20+10+1+25 211
ACDGHIL 30+60+50+30+20+25+25 240
ACDGHJKL 30+60+40+30+20+10+1+25 196

The longest route time path route through the network drawing for Hill Construction is

ACDGHIL. The project is expected to take 240 days to finish.

Time Estimates (Days) for Hill Construction

OPTIMISTIC MOST EXPECTED

ACTIVITY PESSIMISTIC VARIANCE
PROBABLE TIME
A 20 30 40 30 11.1111

C 50 60 100 65 69.4444

D 30 50 100 55 136.1111

G 25 30 35 30 2.7778

H 10 20 30 20 11.1111

I 20 25 60 30 44.4444

L 20 25 60 30 44.4444

Project Variance = 11.1111+69.4444+136.1111+2.7778+11.1111+44.4444+44.4444

= 319.4443

Project Standard Deviation = 319 .4443

= 17.87 days

250 − 240
Z=
17 .87

= 0.55959709

= 55.96%

Thus, there is 55.96% chance that the expansion of the on-campus stadium can be

accomplished in 270 days or less.

 To be able to crash to 240 days, we reduced two activities which has the lowest crash cost

per day. First to crash is activity A, this has the lowest cost of $1,500. The duration of activity A

can only be reduced by 10 days maximum; thus cost of $1,500 multiplied by 10 is $15,000. The

next one to be crashed is activity D which has the cost of $1,900. The duration of activity A can

only be reduced by 20 days maximum; thus $1,900 multiplied by 20 is $38,000. The total

additional cost necessary to crash to 240 days is $53,000 (15,000+38,000).

On the other hand in order to crash to 250, we did the same procedure but instead of choosing

reducing the duration of activity D by 20, we reduced it by 10 days only; thus $1,900 multiplied

by 10 is $19,000. The total additional cost necessary to crash to 250 days is $34,000

(15,000+19,000).