CASE ANALYSIS:

SOUTHWESTERN UNIVERSITY

Submitted by:
CHIONG, Zeimuill Andrau P.
GAMOTIN, Jessa Mae E.
IBALE, Charissa Joyce D.S.
ACA

Submitted to:
MRS. LHEIDA MARIZ L. BARACCAO
BA24 Teacher

February 01, 2020

 SOUTHWESTERN UNIVERSITY
Case Analysis PART I
I. The Case:
Southwestern University (SWU), a large state college in Stephenville, Texas, 30 miles southwest of the
Dallas/Fort Worth metroplex, enrolls close to 20,000 students. In a typical town–gown relationship, the school is a
dominant force in the small city, with more students during fall and spring than permanent residents.
A longtime football powerhouse, SWU is a member of the Big Eleven conference and is usually in the top
20 in college football rankings. To bolster its chances of reaching the elusive and long-desired number-one ranking,
in 2009, SWU hired the legendary Phil Flamm as its head coach.
One of Flamm’s demands on joining SWU had been a new stadium. With attendance increasing, SWU
administrators began to face the issue head-on. After 6 months of study, much political arm wrestling, and some
serious financial analysis, Dr. Joel Wisner, president of Southwestern University, had reached a decision to expand
the capacity at its on-campus stadium.
Adding thousands of seats, including dozens of luxury skyboxes, would not please everyone. The
influential Flamm had argued the need for a first-class stadium, one with built-in dormitory rooms for his players
and a palatial office appropriate for the coach of a 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 2015 season ended. This would allow
exactly 270 days until the 2016 season opening game. The contractor, Hill Construction (Bob Hill being an alumnus,
of course), signed his contract. Bob Hill looked at the tasks his engineers had outlined and looked President Wisner
in the 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 Wisner. “The contract penalty of $10,000 per day for running late is nothing
compared to what Coach Flamm will do to you if our opening game with Penn State is delayed or canceled.” Hill,
sweating slightly, did not need to respond. In football-crazy Texas, Hill Construction would be mud if the 270-day
target was missed.
Back in his office, Hill again reviewed the data (see Table 3.6) and noted that optimistic time estimates
can be used as crash times. He then gathered his foremen. “Folks, if we’re not 75% sure we’ll finish this stadium
in less than 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!”

Table 3.6: Southwestern University Project

TIME ESTIMATES (DAYS)
Most Crash
Activity Description Predecessor Optimistic Pessimistic
Likely Cost/Day
A Bonding, insurance, tax structuring - 20 30 40 $ 1,500
B Foundation, concrete footings for boxes A 20 65 80 3,500
C Upgrading skybox stadium seating A 50 60 100 4,000
D Upgrading walkways, stairwells, elevators C 30 50 100 1,900
E Interior wiring, lathes B 25 30 35 9,500
F Inspection approvals E 0.1 0.1 0.1 0
G Plumbing D, F 25 30 35 2,500
H Painting G 10 20 30 2,000
I Hardware/AC/metal workings H 20 25 60 2,000
J Tile/carpet/windows H 8 10 12 6,000
K Inspection J 0.1 0.1 0.1 0
L Final detail work/cleanup I, K 20 25 60 4,500

Discussion Questions:
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 is 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.

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 II. Analysis

Question No.1

Determine a network drawing for Hill Construction and determine the critical path. How long is the project
expected to take?

Step 1: To compute for “Normal Days” to be used in AoN Network, we will use PERT:
Table 1. Project Scheduling Considering Uncertain Activity Times
Activity Description Optimistic Most likely Pessimistic Expected time Variance
a m b t = (a+4m+b)/6 [(b-a)/6]2
A Bonding, insurance, tax structuring 20 30 40 30 11.11
B Foundation, concrete footings for boxes 20 65 80 60 100
C Upgrading skybox stadium seating 50 60 100 65 69.44
D Upgrading walkways, stairwells, elevators 30 50 100 55 136.11
E Interior wiring, lathes 25 30 35 30 2.78
F Inspection approvals 0.1 0.1 0.1 0.1 0
G Plumbing 25 30 35 30 2.78
H Painting 10 20 30 20 11.11
I Hardware/AC/metal workings 20 25 60 30 44.44
J Tile/carpet/windows 8 10 12 10 0.44
K Inspection 0.1 0.1 0.1 0.1 0
L Final detail work/cleanup 20 25 60 30 44.44
TOTAL 360.2 422.65

Step 2: Activity-on-Node (AoN) Network:

30 B 90 90 E 120 120 F 120.1 200 I 230

59.9 60 119.9 119.9 30 149.9 149.9 0.1 150 200 30 230

0 A 30 150 G 180 180 H 200 230 L 260

0 30 30 150 30 180 180 20 200 230 30 260

30 C 95 95 D 150 200 J 210 210 K 210.1

30 65 95 95 55 150 219.9 10 229.9 229.9 0.1 230

Step 3:
Critical Path (CP): A–C–D–G–H–I–L
Projected Finish Time: 30 + 65 + 55 + 30 + 20 +30 +30
= 260 DAYS
Projected Variance of CP: 11.11 + 69.44 + 136.11 + 2.78 + 11.11 + 44.44 + 44.44
= 319.43
Standard Deviation of CP: √Projected Variance of CP or √319.43
= 17.87

Analysis for Step 1 to Step 3:

The identified critical path is A – C – D – G – H – I – L with a total of projected 260 days in order to
complete the Southwestern University Project. The identified “critical” activities included in the critical path cannot
be delayed since it has no slack time, in other words, it must be on time or else the whole project schedule will
be tumbled-down (see Table 2). On the other hand, “noncritical” activities can be delayed. In the case of Activity
B, E, and F, it can be delayed for 29.9 days.
Also, take note that this problem presented “uncertainty of activity times” that is why by using the Program
Evaluation and Review Technique (PERT), we are able to compute for the average of the three presented time

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estimates (optimistic, most likely, and pessimistic) and come up the expected time for each activity using the
formula presented in Table 1. Since there are three given time estimates, we need to know the dispersion or
variation (see Table 1) in the activity time values. The difference between the pessimistic (b) and optimistic (a)
time estimates greatly affects the value of the variance. Large difference between these two values reflect a
high degree of uncertainty in activity times. Moreover, due to this fact, we can conclude that the projected 260
days of completion is not absolute enough because variation in activities can cause variation in the project
completion time. However, the variation on noncritical activities ordinarily has no effect on the projected completion
time because of the slack time associated with these activities. Take note that for planning purposes, the expected
time still provides valuable information for project managers.

Table 2. Activity Schedule

Activity Earliest Start Latest Start Earliest Finish Latest Finish Slack (LS-ES) Critical Path?
A 0 0 30 30 0 Yes
B 30 59.9 90 119.9 29.9 No
C 30 30 95 95 0 Yes
D 95 95 150 150 0 Yes
E 90 119.9 120 149.9 29.9 No
F 120 149.9 120.1 150 29.9 No
G 150 150 180 180 0 Yes
H 180 180 200 200 0 Yes
I 200 200 230 230 0 Yes
J 200 219.9 210 229.9 9.9 No
K 210 229.9 210.1 230 19.9 No
L 230 230 260 260 0 Yes

PERT calculates a weighted average as the PERT estimate by using the formula: Pert Estimate =
(Optimistic + (4 x Most Likely) + Pessimistic)/6. That means that we are weighting the most likely estimate by a
factor of four (4) and then determining the average of the weighted most likely time, the best-case scenario and
the worst-case scenario. In the case of Activity A (refer to Table 1), that will be (20 +(4 x 30) +40)/6. The PERT
estimate is therefore calculated as 30 days. If we compare the PERT estimate of 30 days with the normal average
of the three estimates of 30 days (20 + 30 + 40 / 3 = 30) we can see that the PERT estimated is weighted towards
the most likely estimate. We use a weighted average calculation because statistically we find that the largest
portion of a randomly occurring population of data will be found close to the mean as can be seen from the following
bell curve, also called a normal distribution curve:
Mean

Percentage of
cases in 8 portions
of the curve .13% 2.14% 13.59% 34.13% 34.13% 13.59% 2.14% .13%

-4ϭ -3ϭ -2ϭ -1ϭ 0 +1ϭ +2ϭ +3ϭ +4ϭ

Standard Deviation
One Sigma: 68%
Two Sigma: 95%
Three Sigma: 99.7%

Normal Bell-Shaped Curve

This bell curve shows us that if we divide the data into 6 equal portions, then by far the majority of the
instances will be found in the 2 portions next to and on both sides of the middle line (mean) while the probability of
the occurrence falling in either the optimistic or pessimistic block is much lower. We divide the graph into 6 equal
block by calculating the standard deviation also called the sigma (identified by the sigma symbol “ϭ”). By using the
simple formula Sigma = (Pessimistic – Optimistic) / 6 we divide the graph in 6 equal blocks. From this we can see
that the PERT estimating formula using (Optimistic + (4 x Most Likely) + Pessimistic)/6 is based on this natural

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distribution. This also gives us a tool with which we can quantify the probability of how the data will be distributed.
Applying this to Activity A:
Mean

Percentage of
cases in 8 portions
of the curve .13% 2.14% 13.59% 34.13% 34.13% 13.59% 2.14% .13%

-4ϭ -3ϭ -2ϭ -1ϭ 0 +1ϭ +2ϭ +3ϭ +4ϭ

Standard Deviation
20 23.33 26.67 30 33.33 36.67 40

Solution:
1 Standard Deviation: 30 + 3.33 = 33.33
-1 Standard Deviation: 30 – 33.33 = 26.67 Same formula applies for the rest.

From the bell curve above, we can thus predict that for Activity A, there is a:
 68% probability of completing the activity between 26.67 and 33.33 days.
 95% probability of completing the activity between 23.33 and 36.67 days.
 99.7% probability of completing the activity between 20 and 40 days.

The same formulas can be used to calculate the one, two and three sigma figures for the critical activities.

Table 3. Normal Distribution of the Critical Activities

Activity O ML P ET Ϭ2 ϭ -3ϭ -2ϭ -1ϭ Mean +1ϭ +2ϭ +3ϭ
A 20 30 40 30 11.11 3.33 20.00 23.33 26.67 30.00 33.33 36.67 40.00
C 50 60 100 65 69.44 8.33 40.00 48.33 56.67 65.00 73.33 81.67 90.00
D 30 50 100 55 136.11 11.67 20.00 31.67 43.33 55.00 66.67 78.33 90.00
G 25 30 35 30 2.78 1.67 25.00 26.67 28.33 30.00 31.67 33.33 35.00
H 10 20 30 20 11.11 3.33 10.00 13.33 16.67 20.00 23.33 26.67 30.00
I 20 25 60 30 44.44 6.67 10.00 16.67 23.33 30.00 36.67 43.33 50.00
L 20 25 60 30 44.44 6.67 10.00 16.67 23.33 30.00 36.67 43.33 50.00
NOTE: The assumption used for the computation in the table above is that all the activities are independent. The main purpose of this
calculation is for the project management to see the individual movements of the activity. Different approach will be used when computing
for the overall project.

The project standard deviation can be calculated by determining the square root of the sum of the PERT
variances. As per presented in the Table 1, the PERT variances is 319.43. The square root of 319.43 is 17.87 (see
computations on page 3). Therefore, one standard deviation for the project as a whole is 17.87 days. This value
can now be used to calculate the values for one, two and three sigma for the total project.

Conclusion:
From the fact stated in the paragraph above we can now conclude that there is:
 68% probability of completing the project between 242.13 and 277.87 days.
 95% probability of completing the project between 224.26 and 295.74 days.
 99.7% probability of completing the project between 206.39 and 313.61 days.

In practice these percentages can be used to indicate, due to the uncertainty of the estimates, that there is a:
 50% probability that the project will be completed within 260 days.
 68% probability that the project will be completed within 278 days.
 95% probability that the project will be completed within 296 days.
 99.7% probability that the project will be completed within 314 days.

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Question No. 2:
What is the probability of finishing in 270 days?

Assuming that the distribution of the path completion time follows a normal or bell-shaped distribution, we
can now compute the probability that a path of activities will meet be completed within a specified time. Now,
suppose the project manager wanted to know probability of finishing the project in 270 days, he can go back to the
values computed before— the Expected Time and Standard Deviation, using the formula:
Due Date - Expected Time
z=
Standard Deviation
Computation: Conclusion:
Referring to the Standard Normal Distribution Table, the corresponding value
270 - 260
z= = 0.5595970901 for 0.56 is 0.7123. This means that the probability of finishing the project
17.87 in 270 days is 71.23%
As you have noticed, there is a small difference between the conclusion in Question No.1 (“There is a
68% probability that the project will be completed within 278 days.”) and No. 2. This is because there is really no
absolute prediction. Moreover, there are quite difference in the underlying assumptions in the formula used.
Remember that all these percentages were all based on estimates and estimates have their own basis.

Question 3:
If it is 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.

When crashing an activity, we assume that each unit of time gained by crashing an activity has the same
associated cost. For this requirement, we will select the activity on the critical path with the smallest crash cost per
day— which is Activity A. To know the maximum possible reduction in time for activity due to crashing, we will
deduct the time for activity under maximum crashing (optimistic time) from the expected time. That is 30 days –
20 days = 10 days. Thus, we can reduce the total project completion date by 10 days which means we can now
“probably” finish the project within 250 days. However, reducing A will cost $1,500 per day.
In order to further reduce the number of days to 240 days, we will still need to crash another project. This
reduction can be achieved by crashing H (using the same formula before) for an additional cost of $2,000 per day.
Now, the total cost to crash to 240 days is $35,000.

Conclusion:
Table 4. Summary of Project Crashing
Activity Description Days Reduced Cost per Day Total Cost
A Bonding, insurance, tax structuring 10 days $1,500 $15,000
H Painting 10 days 2,000 20,000
TOTAL 20 days $3,500 $35,000

You can say that we can also crash D instead of H since it has lower cost than H. However, that is not
the only factor to consider. Crashing D will reduce the days from 250 to 225. However, since it has more days than
H and remember that we assume that each unit of time gained by crashing an activity has the same associated
cost therefore it will still incur higher costs of $28,500 (25 days x $1,900) in total.

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 SOUTHWESTERN UNIVERSITY
Case Analysis PART II
I. The Case:
Southwestern University (SWU), a large state college in Stephenville, Texas, enrolls close to 20,000
students. The school is a dominant force in the small city, with more students during fall and spring than permanent
residents.
Always a football powerhouse, SWU is usually in the top 20 in college football rankings. Since the
legendary Phil Flamm was hired as its head coach in 2009 (in hopes of reaching the elusive number 1 ranking),
attendance at the five Saturday home games each year increased. Prior to Flamm’s arrival, attendance generally
averaged 25,000 to 29,000 per game. Season ticket sales bumped up by 10,000 just with the announcement of
the new coach’s arrival. Stephenville and SWU were ready to move to the big time!
The immediate issue facing SWU, however, was not NCAA ranking. It was capacity. The existing SWU
stadium, built in 1953, has seating for 54,000 fans. The following table indicates attendance at each game for the
past 6 years.
One of Flamm’s demands upon joining SWU had been a stadium expansion, or possibly even a new
stadium. With attendance increasing, SWU administrators began to face the issue head-on. Flamm had wanted
dormitories solely for his athletes in the stadium as an additional feature of any expansion.
SWU’s president, Dr. Joel Wisner, decided it was time for his vice president of development to forecast
when the existing stadium would “max out.” The expansion was, in his mind, a given. But Wisner needed to know
how long he could wait. He also sought a revenue projection, assuming an average ticket price of $50 in 2016 and
a 5% increase each year in future prices.

Southwestern University Football Game Attendance, 2010-2015

2010 2011 2012
Game Attendees Opponent Attendees Opponent Attendees Opponent
1 34,200 Ric 36,100 Miami 39,500 USC
2a 39,800 Texas 40,200 Nebraska 46,500 Texas Tech
3 38,200 Duke 39,100 Ohio State 43,100 Alaska
4b 26,900 Arkansas 25,300 Nevada 27,900 Arizona
5 35,100 TCU 36,200 Boise State 39,200 Baylor

2013 2014 2015

Game Attendees Opponent Attendees Opponent Attendees Opponent
1 41,900 Arkansas 42,500 Indiana 46,900 LSU
2a 46,100 Missouri 48,200 North Texas 50,100 Texas
3 43,900 Florida 44,200 Texas A&M 45,900 South Florida
4b 30,100 Central Florida 33,900 Southern 36,300 Montana
5 40,500 LSU 47,800 Oklahoma 49,900 Arizona State

Discussion Questions
1. Develop a forecasting model, justifying its selection over other techniques, and project attendance
through 2017.
2. What revenues are to be expected in 2016 and 2017?
3. Discuss the school’s options.

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II. Analysis

Question No.1

Develop a forecasting model, justifying its selection over other techniques, and project attendance through
2017.