CHAPTER 6

PROJECT TIME-COST TRADE-OFF

 Activity durations can often vary depending upon the
type and amount of resources that are applied.

 Assigning more workers to a particular activity will

normally result in a shorter duration.

 Greater speed may result in higher costs and lower

quality, however. Reducing both construction projects’
cost and time is critical in today’s market-driven economy.

 This relationship between construction projects’ time and

cost is called time- cost trade-off decisions.
ETU, Construction Management PROJECT
TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
 Cont’d
 Time-cost trade-off decisions are complex and require
selection of appropriate construction method for each
project task.

 Time-cost trade-off, is an important management tool

for overcoming one of the critical path method
limitations of being unable to bring the project schedule
to a specified duration.

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
6.1 Objective Time-Cost Trade-Off
 The objective of the time-cost trade-off analysis is to:
 Reduce the original project duration, determined form the
critical path analysis,
 Meet a specific deadline, with the least cost.
 Finish the project in a specific time
 Recover early delays.
 Avoid liquidated damages.
 Free key resources early for other projects.
 Avoid adverse weather conditions that might affect productivity.
 Receive an early completion-bonus.
 Improve project cash flow ETU, Construction Management PROJECT
TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
 Cont’d
 Reducing project duration can be done by adjusting overlaps
between activities or by reducing activities’ duration.
For Instance: A simple case arises in the use of overtime
work. By:
 scheduling weekend or evening work, calendar days will be
reduced the completion time of projects.
 However, extra wages must be paid for such overtime work,
Also, overtime work is more prone to accidents and quality
problems that must be corrected, so costs may increase.

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
Therefore, The activity duration can be reduced by one of
the following actions:
 Applying multiple-shifts/move/ delay work.
 Working extended hours (over time).
 Offering incentive payments to increase the
productivity.
 Working on week ends and holidays.
 Using additional resources.
 Using alternate construction methods or sequence.

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
6.2 Activity Time-Cost Relationship
 In general, there is a trade-off(the act of balancing b/n two things
that you need)
 The time and the direct cost to complete an activity;
 The less expensive the resources, the larger duration they take to
complete an activity.

 Shortening the duration on an activity will normally increase its

direct cost which comprises the cost of labor, equipment, and
material. It should never be assumed that the quantity of resources
deployed and the task duration are inversely related.

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
A simple representation of the possible relationship between the
duration of an activity and its direct costs appears in Figure 2.1.

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
 Cont’
 The slope of the line connecting the normal point (lower
point) and the crash point (upper point) is called the cost
slope of the activity.

 The slope of this line can be calculated mathematically

by knowing the coordinates of the normal and crash
points.

Cost slope = crash cost – normal cost

normal duration – crash duration

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
 Cont’

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
Example 1.1. Cont’d
• A subcontractor has the task of erecting 8400 square meter of
metal scaffolds. The contractor can use several crews with various
costs. It is expected that the production will vary with the crew size
as given below:

• Consider the following rates: Labor LE96/day; carpenter LE128/day;

foreman LE144/day and scaffolding LE60/day. Determine the direct
cost of this activity considering different crews formation.

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
 Cont’d
Solution

Step 1. The duration for installing the metal scaffold can be

determined by dividing the total quantity by the
estimated daily production.

Step 2. The cost can be determined by summing up the daily

cost of each crew and

Step 3. then multiply it by the duration of using that crew.

The calculations are shown in the following table.

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
 Cont’d

This example illustrates the options which the planner

develops as he/she establishes the normal duration for an
activity by choosing the least cost alternative. The cost slop
for this activity can be calculates as follow:

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
 Cost slope 1. (b/n points 1 and 2) = Cont’d
(33936 – 33252) = 76.22 LE/day
(51 – 42)
 Cost slope 2. (b/n points 2 and 3) =
(34632 – 33936) = 139.2 LE/day
(42 – 37)

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
2.3. Project Time-Cost Relationship Cont’d
 Total project costs include both direct costs and indirect costs of
performing the activities of the project.

 Direct costs for the project include the costs of materials,

labor, equipment, and subcontractors. As the direct cost for the
project equals the sum of the direct costs of its activities, then
the project direct cost will increase by decreasing its duration

 Indirect costs, on the other hand, are the necessary costs of

doing work which can not be related to a particular activity,
and in some cases can not be related to a specific project.
While the indirect cost will decrease by decreasing the project
duration

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
 Cont’d
• illustrates the direct and indirect cost relationships
with the project duration.

 The project total time-cost relationship can be determined by adding

up the direct cost and indirect cost values together.
 The optimum project duration can be determined as the project
duration that results in the least project total cost.
ETU, Construction Management PROJECT
TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
2.4 Shortening Project Duration Cont’
 The minimum time to complete a project is called the
project-crash time. This minimum completion time can be
found by applying critical path scheduling with all
activity durations set to their minimum values.

 This minimum completion time for the project can then

be used to determine the project-crash cost.

 Since there are some activities not on the critical

path that can be assigned longer duration without
delaying the project,
 it is advantageous to change the all-crash schedule
and thereby reduce costs.
ETU, Construction Management PROJECT
TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
 Cont’d
 Essentially, the planner develops a list of activities on the
critical path ranked with their cost slopes. The heuristic
solution proceeds by shortening activities in the order of
their lowest cost slopes.
 As the duration of activities on the shortest path are
shortened, the project duration is also reduced.

• Eventually, another path becomes critical, and a new

list of activities on the critical path must be
prepared. Using this way, good but not
necessarily optimal schedules can be identified.

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
2.3.1. procedure for shortening project duration can be summarized
in the following steps:
1. Draw the project network.
2. Perform CPM calculations and identify the critical path, use normal
durations and costs for all activities.
3. Compute the cost slope for each activity from the following equation:
cost slope = crash cost – normal cost / normal duration – crash duration
4. Start by shortening the activity duration on the critical path which has
the least cost slope and not been shortened to its crash duration.
5. Reduce the duration of the critical activities with least cost slope until
its crash duration is reached or until the critical path changes.
6. When multiple critical paths are involved, the activity(ies) to shorten
is determined by comparing the cost slope of the activity which lies
on all critical paths (if any), with the sum of cost slope for a group of
activities, each one of them lies on one of the critical paths.

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
 Cont’d
7. Having shortened a critical path, you should adjust activities timings,
and floats.
8. The cost increase due to activity shortening is calculated as the
cost slope multiplied by the time of time units shortened.

9. Continue until no further shortening is possible, and then the crash

point is reached.

10. The results may be represented graphically by plotting project

completion time against cumulative cost increase. This is the project
direct-cost / time relationship. By adding the project indirect cost to
this curve to obtain the project time / cost curve. This curve gives the
optimum duration and the corresponding minimum cost.

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
 Cont’d
Example 2.2
Assume the following project data given in Table 2.1. It is required to
crash the project duration from its original duration to a final duration of
110 days. Assume daily indirect cost of LE 100.

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
Solution Cont’d
The cost slope of each activity is calculated. Both the crash ability and
the cost slope are shown beneath each activity in the precedence
diagram. The critical path is B-C-D-E and the project duration in 140
days. Project total normal direct cost = sum of normal direct costs of all
activities = LE 48300.

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
 Cont’d
1. The activity on the critical path with the lowest cost slope
is of activity “D”, this activity can be crashed by 10 days.
Then adjust timing of the activities.

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
 Cont’d
A new critical path will be formed, B-F-E. New Project duration is 130
days.
The project direct cost is increased by 10 x 60 = LE 600.
Project direct cost = 48300 + 600 = LE 48900
2. At this step activity “E” will be crashed, as this activity lies on both
critical paths. Activity “E” will be shortened by 10 days.

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
 Cont’d
• Accordingly, all activities will be turn to critical activities.
• New Project duration is 120 days.
• The project direct cost is increased by 10 x 120 = LE 1200.
• Project direct cost = 48900 + 1200 = LE 50100

3. In this step, it is difficult to decrease one activity’s duration and achieve

decreasing in the project duration. So, either to crash an activity on all critical
paths (if any), otherwise, choose several activities on different critical paths. As
shown, activities “A” and “B” can be crashed together which have the least cost
slope (100 + 200).
Then, crash activities “A” and “B” by 5 days.

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
New Project duration is 115 days.

New Project duration is 115 days.

The project direct cost is increased by 5 x (100 + 200) = LE 1500.
Project direct cost = 50100 + 1500 = LE 51600
ETU, Construction Management PROJECT
TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
 Cont’d
4. In this final step, it is required to decrease the duration of an
activity from each path.
 The duration of activity ”A” will be crashed to 110 days, “C” to 35
days, and “F” to 55 days. Thus, achieving decreasing project
duration to 110 days. Also, increase in the project direct cost by 5 x
(100 + 600 + 300) LE 5000

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
Example 2.3 Cont’d
 The durations and direct costs for each activity in the network of a
small construction contract under both normal and crash
conditions are given in the following table. Establish the least
cost for expediting the contract. Determine the optimum duration of
the contract assuming the indirect cost is LE 125/day.

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
Solution
Step 1. The cost slope of each activity is calculated. Both the
crushability and the cost slope are shown beneath each activity in the
precedence diagram. Activities Cost slope
A 100
B 150
C 100
D 0
E 50
F 300
G 60
H 40
I 75

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
 Cont’d
Step 2. The critical path is A-C-G-I and the contract
duration in 59 days.

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
Step3. The activity on the critical path with the lowest cost slope is
“G”, Therefore, activity “G will be crashed by 2 days only. Then adjust
timing of the activities.

A new critical path will be formed, A-C-F-H-I. New contract duration

is 57 days and the cost increase is: 2 x 60 = LE 120.
ETU, Construction Management PROJECT
TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
Then, At this step the activities that can be crashed are listed below:
Either “A” at cost LE 100/day
Or “C” at cost LE 200/day
Or “I” at cost LE 75/day
Or “F & G” at cost LE 360/day
Or “H & G” at cost LE 100/ day
Then, Activity “I” is chosen because it has the least cost slope, and it can
be crashed by 2 days. Because it is last activity in the network, it has no
effect on other activities.

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
 Cont’d

New contract duration is 55 days and the cost

increase is:
2 x 75 = LE 150.

New contract duration is 55 days and the cost increase is:

2 x 75 = LE 150.

And Cumulative cost increase = 120 + 150 = LE 270

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
 Cont’d
Then, Now, we could select “A” or both “H & G”, because they have
the same cost slope. Activity “A” is chosen to be crashed. This will
change the timings for all activities, but no new critical path will be
formed.

New contract duration is 53 days and the cost increase is 2 x 100 = LE

200. Accordingly, cumulative cost increase = 270 + 200 = LE 4704.
ETU, Construction Management PROJECT
TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
 Cont’d
Then, Now, activities “H & G” can be crashed by 2 days each and new
critical path A- B-D-I will be formed.

New contract duration is 51 day and the cost increase is:

2 x 100 = LE 200.
cumulative cost increase = 470 + 200 = LE 670

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
• And again At this stage, the network has three critical paths.
The activities that can be crashed are listed below:
• Either C & B at cost LE 350/day or F, G & B at cost LE 510/day.
Activities C & B are chosen because they have the least cost slope.

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
And the New contract duration is 49 days and the cost increase is 2 x
350 = LE 700. Cumulative cost increase = 670 + 700 = LE 1370
Now, there is no further shortening is possible.
The contract duration and the corresponding cost are given in the table
below.

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).
 Exemple III
 With in -Admin Cost and Assume Admin cost = $500

Activity Predecessor Days Time

(normal, crash) (normal, crash)
a - 3, 2 $250,500

b a 5,3 200, 400

c b 5, 2 200, 800

d c 3,3

x a 5,2 1450, 2500

y x 4,2 500, 750

z y 3,1 1110, 1760

FTVETI, Construction Management, Lecture Notes, 2013, Teddy A. (MSc.).
Activity $ Saved/
Day (Slope)
a 250
b 100
c 200
d -
x 350
y 125
z 325

FTVETI, Construction Management, Lecture Notes, 2013, Teddy A. (MSc.).

 5 5 3
Normal
Crash
(per period)
Duration: 3 B C D Costs
2 3 A -$250
A 3
3
Minimum 5 4 B-$100
Duration: 2
X Y Z C-$200
2 2 1
Admin Cost = $500 D-
X-$350
Path Duration
ABCD 16 Y-$125
AXYZ 15 Which Z-$325
activity
should we
crash?
FTVETI, Construction Management, Lecture
Notes, 2013, Teddy A. (MSc.).
 3 Crash Costs
5 5 per period)
Normal
Duration: 3 B C D A -$250

2 3 B-$100
A 3
4 3 C-$200
Minimum 5
Duration: 2 D-
X Y Z
X-$350
2 2 1
Admin Cost = $500 Y-$125
Z-$325
Path Duration
ABCD 16
AXYZ 15

FTVETI, Construction Management, Lecture Notes, 2013, Teddy A. (MSc.).

 3
5 Crash
Normal 5
Duration: 3 B C D (per
Costs
period)

2 3 A -$250
A 3
5 4 3
Minimum B-$100
Duration: 2
X Y Z C-$200
2 2 1
Admin Cost = $500 D-
X-$350
Path Duration
ABCD 16 Y-$125
AXYZ 15 Z-$325

FTVETI, Construction Management, Lecture

Notes, 2013, Teddy A. (MSc.).
 3
5 5 Crash Costs
Normal
Duration: 3 B C D (per period)
A -$250
2 3
A 3 B-$100
5 4 3
Minimum
Duration: 2 C-$200
X Y Z
D-
2 2 1
Admin Cost = $500 X-$350
Path Duration Y-$125
ABCD 16 Z-$325
AXYZ 15

FTVETI, Construction Management, Lecture

Notes, 2013, Teddy A. (MSc.).
 5 5 5 33
Normal 5 Crash Costs
Duration:
3 3 B B CC DD (per period)
A -$250
2 2 33
A A 3 3 B-$100
5 5 4 4 33
Minimum
2
Duration: 2 C-$200
X X YY ZZ
D-
2 2
Admin Cost = $500
22 11
X-$350
B
Path Duration
Y-$125
ABCD 16
AXYZ 15 Choose B because it is Z-$325
the cheapest of the
three alternatives (A, B,
or C)
FTVETI, Construction Management, Lecture Notes, 2013, Teddy A. (MSc.).
 4 5 33
Normal
Crash Costs
Duration: 3 B C D (per period)
A -$250
2 3
A 3 B-$100
5 4 3
Minimum
Duration: 2 C-$200
X Y Z
D-
2 22 1
Admin Cost X-$350
= $500 B
Path Duration Y-$125
ABCD 16 15 Z-$325
AXYZ 15 15

Cost 100 Which activity(s)

Save 500 should we crash
Net 400 next?
Cumul 400 FTVETI, Construction Management, Lecture Notes, 2013, Teddy A. (MSc.).
 44 5 33
Normal
Crash Costs
Duration: 3 B C D (per period)
A -$250
2 3
A 3 B-$100
5 4 3
Minimum
Duration: 2 C-$200
X Y Z
D-
Admin Cost = $500 2 22 11
X-$350
B
Path Duration Y-$125
ABCD 16 15 Z-$325
AXYZ 15 15

Cost 100
Save 500
Net 400
Cumul 400 FTVETI, Construction Management, Lecture Notes, 2013, Teddy A. (MSc.).
 44 5 33
Normal
Crash Costs
Duration: 3 B C D (per period)
A -$250
2 3
A 3 B-$100
5 4 3
Minimum
Duration: 2 C-$200
X Y Z
D-
2 22 11
Admin Cost X-$350
= $500 B
Path Duration Y-$125
ABCD 16 15 Z-$325
AXYZ 15 15

Cost 100
Save 500
Net 400
Cumul 400 FTVETI, Construction Management, Lecture
Notes, 2013, Teddy A. (MSc.).
 44 5 33
Normal
Crash Costs
Duration: 3 B C D (per period)
A -$250
2 3
A 3 B-$100
5 4 3
Minimum
Duration: 2 C-$200
X Y Z
D-
2 22 11
Admin Cost X-$350
= $500 B
Path Duration Y-$125
ABCD 16 15 Z-$325
AXYZ 15 15

Cost 100
Save 500
Net 400
Cumul 400 FTVETI, Construction Management, Lecture Notes, 2013, Teddy A. (MSc.).
 44 5 33
Normal
Crash Costs
Duration: 3 B C D (per period)
A -$250
2 3
A 3 B-$100
5 4 3
Minimum
Duration: 2 C-$200
X Y Z
D-
Admin Cost
2 22 11
X-$350
= $500 B
Path Duration Y-$125
ABCD 16 15 Z-$325
AXYZ 15 15

Cost 100
Save 500
Net 400
Cumul 400 FTVETI, Construction Management, Lecture
Notes, 2013, Teddy A. (MSc.).
 44 5 33
Normal
Crash Costs
Duration: 3 B C D (per period)
A -$250
2 3
A 3 B-$100
5 4 3
Minimum
Duration: 2 C-$200
X Y Z
D-
2 2 11
Admin Cost X-$350
= $500 B
Path Duration Y-$125
ABCD 16 15 Z-$325
AXYZ 15 15

Cost 100
Save 500
Net 400
Cumul 400 FTVETI, Construction Management, Lecture
Notes, 2013, Teddy A. (MSc.).
 44 5 33
Normal
Crash Costs
Duration: 3 B C D (per period)
A -$250
2 3
A 3 B-$100
5 4 3
Minimum
Duration: 2 C-$200
X Y Z
D-
Admin Cost 2 2 11
= $500 X-$350
B
Path Duration Y-$125
ABCD 16 15 Z-$325
AXYZ 15 15

Cost 100
Save 500
Net 400
Cumul 400 FTVETI, Construction Management, Lecture
Notes, 2013, Teddy A. (MSc.).
 44 5 33
Normal
Crash Costs
Duration: 3 B C D (per period)
A -$250
2 3
A 3 B-$100
5 4 3
Minimum
Duration: 2 C-$200
X Y Z
D-
2 2 11
Admin Cost X-$350
= $500 B
Path Duration Y-$125
ABCD 16 15 Z-$325
AXYZ 15 15

Cost 100
Save 500
Net 400
Cumul 400 FTVETI, Construction Management, Lecture
Notes, 2013, Teddy A. (MSc.).
 44 5 33
Normal
Crash Costs
Duration: 3 B C D (per period)
A -$250
2 3
A 3 B-$100
5 4 3
Minimum
Duration: 2 C-$200
X Y Z
D-
2 2 11
Admin Cost X-$350
= $500 B BY
Path Duration Y-$125
ABCD 16 15 Z-$325
AXYZ 15 15

Cost 100
Save 500
Net 400
Cumul 400 FTVETI, Construction Management, Lecture
Notes, 2013, Teddy A. (MSc.).
 3 5 33
Normal
Crash Costs
Duration: 3 B C D (per period)
A -$250
2 3
A 3 B-$100
5 3 3
Minimum
Duration: 2 C-$200
X Y Z
D-
2 22 11
Admin Cost X-$350
= $500 B BY
Path Duration Y-$125
ABCD 16 15 14 Z-$325
AXYZ 15 15 14

Cost 100 225

Save 500 500 Which activity(s)
Net 400 275 should we crash
Cumul 400 675
FTVETI, Construction Management, Lecture next?
Notes, 2013, Teddy A. (MSc.).
 33 5 33
Crash Costs
Normal
Duration: 3 B C D (per period)
A -$250
2 3
A 3 B-$100
5 3 3
Minimum
Duration: 2 C-$200
X Y Z
D-
2 22 11
Admin Cost X-$350
= $500 B BY
Path Duration Y-$125
ABCD 16 15 14 Z-$325
AXYZ 15 15 14

Cost 100 225

Save 500 500
Net 400 275
Cumul 400 675
FTVETI, Construction Management, Lecture
Notes, 2013, Teddy A. (MSc.).
 33 5 33
Normal
Crash Costs
Duration: 3 B C D (per period)
A -$250
2 3
A 3 B-$100
5 3 3
Minimum
Duration: 2 C-$200
X Y Z
D-
2 22 11
Admin Cost X-$350
= $500 B BY
Path Duration Y-$125
ABCD 16 15 14 Z-$325
AXYZ 15 15 14

Cost 100 225

Save 500 500
Net 400 275
Cumul 400 675
FTVETI, Construction Management, Lecture
Notes, 2013, Teddy A. (MSc.).
 3 5 3
Normal
Crash Costs
Duration: 3 B C D (per period)
A -$250
2 3
A 3 B-$100
5 3 3
Minimum
Duration: 2 C-$200
X Y Z
D-
Admin Cost 2 2 1
X-$350
= $500 B BY
Path Duration Y-$125
ABCD 16 15 14 Z-$325
AXYZ 15 15 14

Cost 100 225

Save 500 500
Net 400 275
Cumul 400 675
FTVETI, Construction Management, Lecture
Notes, 2013, Teddy A. (MSc.).
 33 5 33
Normal
Crash Costs
Duration: 3 B C D (per period)
A -$250
2 3
A 3 B-$100
5 3 3
Minimum
Duration: 2 C-$200
X Y Z
1 D-
Admin Cost 2 22 1
X-$350
= $500 B BY
Path Duration Y-$125
ABCD 16 15 14 Z-$325
AXYZ 15 15 14

Cost 100 225

Save 500 500
Net 400 275
Cumul 400 675
FTVETI, Construction Management, Lecture
Notes, 2013, Teddy A. (MSc.).
 33 5 33
Normal
Crash Costs
Duration: 3 B C D (per period)
A -$250
2 3
A 3 B-$100
5 3 3
Minimum
Duration: 2 C-$200
X Y Z
1 D-
Admin Cost 2 22 1
X-$350
= $500 B BY A
Path Duration Y-$125
ABCD 16 15 14 Z-$325
AXYZ 15 15 14

Cost 100 225

Save 500 500
Net 400 275
Cumul 400 675
FTVETI, Construction Management, Lecture
Notes, 2013, Teddy A. (MSc.).
 3 5 3
Normal
Crash Costs
Duration: 2 B C D (per period)
A -$250
2 3
A 3 B-$100
5 3 3
Minimum
Duration: 2 C-$200
X Y Z
D-
2 2 1
Admin Cost X-$350
= $500 B BY A
Path Duration Y-$125
ABCD 16 15 14 13 Z-$325
AXYZ 15 15 14 13

Cost 100 225 250

Save 500 500 500
Net 400 275 250
Cumul 400 675 925
FTVETI, Construction Management, Lecture Notes, 2013, Teddy A. (MSc.).
 3 5 3
Normal
Crash Costs
Duration: 2 B C D (per period)
A -$250
2 3
A 3 B-$100
5 3 3
Minimum
Duration: 2 C-$200
X Y Z
D-
2 2 1
Admin Cost X-$350
= $500 B BY A
Path Duration Y-$125
ABCD 16 15 14 13 Z-$325
AXYZ 15 15 14 13

Cost 100 225 250 Which activity(s)

Save 500 500 500 should we crash
Net 400 275 250 next?
Cumul 400 675 925 Management, Lecture
FTVETI, Construction
Notes, 2013, Teddy A. (MSc.).
 3 4 3
Normal
Crash Costs
Duration: 2 B C D (per period)
A -$250
2 3
A 3 B-$100
5 2 3
Minimum
Duration: 2 C-$200
X Y Z
D-
2 2 1
Admin Cost X-$350
= $500 B BY A CY
Path Duration Y-$125
ABCD 16 15 14 13 12 Z-$325
AXYZ 15 15 14 13 12

Cost 100 225 250 325

Save 500 500 500 500
Net 400 275 250 175
Cumul 400 675 925 Management,
FTVETI, Construction 1100 Lecture
Notes, 2013, Teddy A. (MSc.).
 3 4 3
Normal
Crash Costs
Duration: 2 B C D (per period)
A -$250
2 3
A 3 B-$100
5 2 3
Minimum
Duration: 2 C-$200
X Y Z
D-
2 2 1
Admin Cost X-$350
= $500 B BY A CY
Path Duration Y-$125
ABCD 16 15 14 13 12 Z-$325
AXYZ 15 15 14 13 12

Cost 100 225 250 325 Which

activity(s)
Save 500 500 500 500 should we
Net 400 275 250 175 crash next?
Cumul 400 675 925 Management,
FTVETI, Construction 1100 Lecture
Notes, 2013, Teddy A. (MSc.).
 3 3 3
Normal
Duration: 2 B C D
2 3
A 3
5 2 2
Minimum
Duration: 2
X Y Z
Admin Cost 2 2 1
= $500 B BY A CY CZ
Path Duration
ABCD 16 15 14 13 12 11 We
AXYZ 15 15 14 13 12 11 lose
$$, so
Cost 100 225 250 325 525
Save 500 500 500 500 500 do not
Net 400 275 250 175 -25 crash
Cumul 400 675 925 1100 1075 CZ
FTVETI, Construction Management, Lecture Notes, 2013, Teddy A. (MSc.).
 3 4 3
Normal
Duration: 2 B C D
2 3
A 3
5 2 3
Minimum
Duration: 2
X Y Z
2 2 1 Achieved
by crashing
B BY A CY
Path Duration
Most economical
ABCD 16 15 14 13 12 duration
AXYZ 15 15 14 13 12
Spent $900 in
increased direct costs
Cost 100 225 250 325
Save 500 500 500 500 Avoided $2000 in
administration costs
Net 400 275 250 175
Cumul 400 675 925 1100 Net savings
FTVETI, Construction Management, Lecture Notes, 2013, Teddy A. (MSc.).
THANK YOU!!!

ETU, Construction Management PROJECT

TIME COST TRADE-OFF, Lecture Notes,
Teddy A. (MSc.).