PROGRAM EVALUATION & REVIEW TECHNIQUE

PERT

It is a project management tool and technique used to plan and manage complex projects,
particularly those with a high degree of uncertainty.

In CPM the activities timings are deterministic in nature. Whereas in PERT each activity will
have three time estimates.

OPTIMISTIC TIME: The shortest time an activity can be completed under ideal conditions.

MOST LIKELY TIME- The most realistic estimate of the time required for an activity to be
completed.

PESSIMISTIC TIME- The longest time an activity might take under adverse conditions.

PERT calculates the expected time for each activity using a weighted average formula. Here
Optimistic time is the shortest time required to complete the task, most likely time is the most
probable duration required to complete the task and pessimistic time is the longest time
required to complete the task.

The formula can also be written as

Te= t0+4tm+tp / 6
Consider example for the calculation of PERT.
In the given table we have activities, predecessors, and duration in weeks. So, here we have
to first construct the project network and then find the expected duration of each activity. And
then we will find the critical path.

Now we will see how to construct the project network. So look at the problem. For activities
A, B, and C there is no predecessor. For every activity we have 2 nodes first is the starting
node and the other one is the ending node. For activity A we have two nodes starting node
and the ending node. Similarly, for activity B we have 2 nodes. The same is for activity C.
Without any predecessor these are the three activities straight away starts.

Now look at the next activity. Activity D starts where activity A has ended. Activity E starts
where activity B has ended. Next is Activity F, Activity F starts where activity C has ended at
the same time F ended along with activity E. The next activity is G , Activity G starts where
activity C has ended.

The next activity is H, activity H starts where activity E and F ended at the same time H ends
along with G. The next Activity is I , I starts where activity D has ended. The last activity is J,
So, activity J starts where activity H & G has ended. And the last activity end up with the last
node that is node 8.
So For Activity A mean duration will be calculated as

5+(4*6)+7/ 6 = 6

Activity B = 1+(4*3)+ 5/6 = 3

Activity C = 1+(4*4)+7/6 = 4

Similarly, the means duration for activity D,E,F,G,H,I & J are 2,3,5,3,5,5 & 3 respectively.
So based on the calculated mean duration we will now find the critical path. To determine the
critical path we need to determine

 EARLIEST START TIME - FORWARD PASS

 LATEST COMPLETION TIME - BACKWARD PASS

EARLIEST START TIME

So the earliest start time of node 1 is 0. For nodes 2 3 & 4 it is the earliest start time of the
starting node plus duration which is 0+6 =6, 0+3 = 3 & 0+4 =4 respectively.
Now for Node 5, it is the earliest start time of node 2 plus duration that is 6+2 which is equal
to 8.For Node 6 we have 2 options

One is from 3 to 6 which is 3+3=6

& another is from 4 to 6 which is 4 + 5 = 9, here we will take the maximum value which is 9

For Node 7 again we have 2 options

One is from 6 to 7 which is 9+5 = 14

And another one is from 4 to 7 which is 4+3 = 7, here we will again take the maximum value
which is 14.

For the last node that is node 8 we have 2 options

One is from 5 to 8 which is 8+5= 13

Another is from 7 to 8 which is 14 + 3 = 17, So again here we will take the maximum value
which is 17.

LATEST COMPLETION TIME

Now let us calculate the backward pass or latest completion time for each and every node.

Latest completion time of i. i represents starting node = minimum of latest completion time
of j. where j represents ending node minus duration. In forward pass calculation, we have
added the duration but in backward pass calculation, we have to subtract the duration from
the latest completion time of the jth activity.
So, For the last 8th node latest completion time will always be equal to the earliest start time
which is 17. Now for node 7, it is 17 minus duration which is 3 = 14

For node 6, it is 14- 5 = 9

For node 5, it is 17-5 = 12

For node 4, we have three options that is 14-3=11,

9-5=4, In the backward pass we will consider the minimum value that is 4.

For node 3, it is 9-3=6

For node 2, it is 12-2 =10

For node 1 again we have three options

That is 10-6=4

6-3=3 & 4-4=0

So, we will take the minimum value which is zero.

Now we need to find the critical path. So in order to find the critical path we have 3
conditions.

 So, the first condition is Earliest start time of the starting node must be equal to the
latest completion time of the same starting node
  Second is the Earliest start time of the ending node must be equal to the Latest
completion time of the ending node)
 The third one is the earliest start time of the ending node minus Earliest start time of
the starting node must be equal to the duration
 The latest completion of the ending node minus the latest completion of the starting
node must be equal to the duration
 So these are the three conditions to be satisfied in order to consider a particular
activity as a critical path.

SO, 1 to 4, 4 to 6,6 to 7 and 7 to 8 is the critical path we have based on the given
conditions and the expected project completion time is sum of duaration of the critical
path which is 4+5+5+3 = 17 weeks

IMPLEMENTATION PLAN FOR TOP MANAGEMENT

Implementation is the phase during which all the predetermined tasks are executed. Before
initiating a project's execution, senior management should conduct an assessment of their
internal strengths and weaknesses, as well as external opportunities and threats. The project
should make the most of its strengths and opportunities, which are positive factors that can
help the project to run smoothly. Whereas, weaknesses and threats can slow down the project.
So the project manager should ensure that they devise means of overcoming the weaknesses
and threats.
This plan serves as a roadmap, detailing how the project will be carried out, what resources
are needed, and how risks and challenges will be managed.

Here's an explanation of the key components typically found in an implementation plan for
top management:

1. Project Title and Objective:

This clearly states the project's name and its primary goal or purpose. It sets the stage
and provides a quick overview of what the project aims to achieve.
2. Scope:
Scope defines the boundaries of the project. What is included in the project, and what
is not? Describe the specific deliverables and outcomes expected.
3. Key Stakeholders:
It List the individuals, groups, or organizations with a vested interest in the project's
success. This helps identify who needs to be kept informed and engaged throughout
the project.
4. Project Team:
This component identifies the members of the project team, including their roles and
responsibilities. This ensures everyone knows their tasks and accountabilities.
5. Timeline:
Timeline provides a detailed schedule with milestones and deadlines. This helps in
tracking progress and ensures that everyone is aware of critical timeframes.
6. Budget:
Budget Specify the financial resources allocated to the project. Include both the total
budget and how it will be distributed among various project activities.
7. Resources:
This component lists the equipment, materials, and personnel required to carry out the
project and ensure that necessary resources are available when needed.
8. Risk Assessment:
It identifies potential risks and challenges that could affect the project. Develop
strategies to mitigate these risks and contingencies for handling unforeseen issues.
9. Strengths and Opportunities:
It highlights the project's positive aspects and how they can be leveraged to ensure
success. This section focuses on capitalizing on advantages.
10. Weaknesses and Threats:
 This component identifies any weaknesses or threats that might hinder the project and
Propose strategies to address these challenges and minimize their impact.
11. Implementation Strategy:
Explain the approach and methodology for carrying out the project. This includes the
step-by-step plan for achieving project goals.
12. Monitoring and Evaluation:
Monitoring and evaluation describes how progress will be monitored and how
performance will be assessed during the project. This ensures that the project stays on
track.
13. Communication Plan:
Communication plan details how information will be shared with stakeholders,
including top management. Specify how issues or updates will be communicated and
resolved.
14. Quality Assurance:
It explains how the project's quality will be ensured and maintained. Detail any
quality control processes that will be in place.
15. Change Management:
This component outlines how changes to the project plan will be managed. Define the
process for requesting, evaluating, and implementing changes.
Summarize the key points of the implementation plan. Reiterate the commitment to
achieving the project's objectives and highlight the critical considerations.
Provide a space for top management to review and sign off on the implementation
plan, indicating their support and agreement with the proposed approach.
An implementation plan is a vital tool for project management and communication
with top management. It ensures that everyone is aligned on the project's goals and
how it will be executed, monitored, and controlled to achieve success.

PLANNING BUDGET

Creating a project budget is a critical step in project planning and management. A well-
structured budget helps ensure that financial resources are allocated appropriately, and it
provides a roadmap for tracking and controlling project expenditures. Here are the steps for
planning the budget for a project:
Define the Project Scope:

Clearly define the scope of the project, including its goals, objectives, deliverables, and
expected outcomes. A well-defined scope provides a basis for estimating costs accurately.

Identify Project Costs:

Identify all the costs associated with the project. These costs can be categorized into two
main types:

Direct Costs: Direct costs are costs directly tied to the project and can include:

Labour: Salaries and wages of project team members and contractors.

Materials: The cost of materials and supplies specific to the project. - Equipment: Expenses
related to renting or purchasing equipment.

Subcontractors: Costs associated with outsourcing specific tasks or services.

Indirect Costs (Overheads): These are costs that cannot be traced directly to the project but
are necessary for its execution. Examples include office space, utilities, and administrative
salaries.

Estimate Costs:

For each cost category, estimate the specific expenses. You can use historical data, industry
benchmarks, expert opinions, or detailed cost analysis to make accurate estimates.

Create a Cost Breakdown Structure (CBS):

Organize the estimated costs into a structured breakdown, grouping related expenses together.
This helps in tracking and controlling costs more effectively.

Contingency Fund:

Set aside a contingency fund as a buffer for unforeseen expenses or scope changes. Typically,
this is a percentage of the total budget (e.g., 10%).

Calculate the Total Budget:

Sum up all the estimated costs, including both direct and indirect costs, and add the
contingency fund if applicable. This gives you the total project budget.
Allocate Resources:

Determine how the budget will be distributed over the project timeline. Create a schedule
showing when funds will be needed for different project phases or tasks.

Document Assumptions and Risks:

Document any assumptions made during the budgeting process and identify potential risks
that could impact the budget. This helps in proactive risk management.

Review and Approval:

Present the budget proposal to relevant stakeholders, including project sponsors and top
management, for review and approval. Ensure that it aligns with organizational goals and
priorities.

Budget Monitoring and Control: - Once the project is underway, continuously monitor
expenses against the budget. Implement a robust system for tracking costs, and be prepared to
make adjustments if necessary.

Reporting:- Regularly communicate budget status and financial reports to stakeholders.

Provide insights into whether the project is on track financially and highlight any significant
variances from the budget.

Effective budget planning is an iterative process that involves ongoing monitoring and
adjustment throughout the project's lifecycle. By carefully planning and managing the budget,
you increase the likelihood of a successful project that meets its financial objectives.

Procurement procedures

Procurement procedures for energy projects involve a series of structured steps and processes
to acquire the necessary goods, services, and equipment required for the development,
construction, and operation of energy-related initiatives. These projects can encompass a
wide range of energy sources, including renewable energy (solar, wind, hydro, etc.), fossil
fuels (oil, natural gas, coal), and nuclear power. Below is the key procurement procedures
typically followed for energy projects: Procurement procedures for energy projects involve a
series of structured steps and processes to acquire the necessary goods, services, and
equipment required for the development, construction, and operation of energy-related
initiatives. These projects can encompass a wide range of energy sources, including
renewable energy (solar, wind, hydro, etc.), fossil fuels (oil, natural gas, coal), and nuclear
power. Below is the key procurement procedures typically followed for energy projects:

Project Planning and Needs Assessment:

Define the objectives and scope of the energy project, including the type of energy source,
capacity, and location.

Identify the specific goods and services required, such as equipment, engineering,
construction, and maintenance services.

Budgeting and Funding:

Determine the project budget, taking into account all costs, including capital expenditure,
operational costs, and contingencies.

Secure funding through various sources, which may include government grants, loans, equity
investment, or private financing.

Procurement Strategy Development:

Develop a procurement strategy that outlines the procurement methods and processes to be
used for various project components.

Consider factors such as risk allocation, contract types (e.g., EPC, BOT, PPA), and vendor
selection criteria.

Vendor Prequalification and Selection:

Identify potential vendors, suppliers, and contractors through a competitive bidding process.

Prequalify vendors based on their qualifications, experience, financial stability, and technical
capabilities.

Select vendors through a competitive and transparent evaluation process.

Request for Proposals (RFP) or Tendering:

Prepare and issue RFPs or tender documents that clearly specify project requirements,
technical specifications, terms, and conditions.

Receive and evaluate proposals from vendors, considering factors like cost, quality, and
delivery timelines.
Contract Negotiation and Award:

Conduct negotiations with selected vendors to finalize contract terms, pricing, and other
critical aspects. Award contracts to the selected vendors after reaching mutually agreeable
terms.

Contract Management:

Establish a robust contract management system to oversee vendor performance, compliance

with terms, and progress tracking. Monitor quality, schedule adherence, and budget control
during the project implementation phase.

Risk Management:

Identify and assess project risks related to procurement, such as supply chain disruptions,
price volatility, and contractual disputes. Develop risk mitigation strategies to minimize the
impact of potential issues.

Quality Assurance and Testing:

Implement quality control measures to ensure that procured goods and services meet
specified standards and requirements. Conduct testing and inspections as needed to verify the
performance of equipment and systems.

Commissioning and Handover:

Verify that all procured equipment and services are correctly installed, integrated, and fully
functional. Plan for commissioning process, including performance testing and acceptance.

Operation and Maintenance Contracts:

If applicable, establish operation and maintenance contracts to ensure the ongoing reliability
and performance of the energy project.

Documentation and Reporting:

Maintain detailed records of all procurement activities, contracts, invoices, and

correspondence. Prepare regular reports on project progress, financial status, and
procurement-related matters for stakeholders and regulatory authorities.

Compliance and Regulatory Approvals:

Ensure compliance with all relevant environmental, safety, and regulatory requirements.
Obtain necessary permits and approvals for the energy project.

Post-Project Evaluation:

Conduct a post-project evaluation to assess the performance, cost-effectiveness, and lessons

learned from the procurement process.

Use the findings to inform future energy project procurement.

Procurement procedures for energy projects are often complex due to the technical nature of
the industry, regulatory requirements, and the long-term impact of project decisions.
Therefore, careful planning, transparent processes, and effective project management are
essential to the successful execution of energy projects.

Project Construction

Project construction means making sure that all parts and systems of a big industrial machine
are created, put in place, tested, used, and looked after the way the user needs them to be.
This process is called commissioning and it can be used not just for new projects but also for
existing ones that are subject to expansion, renovation, or revamping.

In real life, commissioning is like using a bunch of engineering methods and steps to
carefully check, inspect, and test every part of a project. This includes everything from small
things like instruments and equipment to bigger combinations like sections, parts, and whole
systems.

These commissioning tasks are important all throughout the project, from the early design
stages to buying stuff, building it, and even when it's handed over to the owner. Sometimes,
they even help with making sure it runs smoothly when it starts being used.

Measurement and verification

Measurement and Verification (M&V), sometimes also known as monitoring and verification,
is a process used to calculate energy and demand reductions. M&V is primarily employed in
energy efficiency projects where the profitability of the investment depends on the
anticipated energy savings. In such cases, M&V becomes a crucial aspect of the project
contract, especially when payments or performance guarantees hinge on the size of the
energy savings resulting from implementing energy-efficient measures. The main focus of
M&V is on identifying and addressing risks that could impact the accuracy of measuring or
determining energy or water savings in efficiency programs. These risks are typically
outlined in the contractual agreements among project participants.

The process involves several key activities:

Verification: This involves confirming that the project is following the planned processes
and procedures. It ensures that the project team is doing what they said they would do.
Verification activities often include reviewing documentation, conducting inspections, and
comparing project progress to the project plan.

Measurement: This involves assessing the project's performance against established metrics
and key performance indicators (KPIs). Measurement helps in evaluating whether the project
is meeting its objectives and delivering the expected outcomes. It can include tracking budget
expenditures, timelines, quality standards, and other project-specific criteria.

Quality Assurance: Part of the verification and measurement process involves quality
assurance activities. These ensure that the project's deliverables meet the required quality
standards and specifications. Quality assurance may include conducting audits, inspections,
and tests to verify the quality of work.

Risk Management: Verification and measurement also play a role in identifying and
mitigating risks. By continuously assessing project progress and potential issues, project
teams can proactively address challenges and minimize their impact on the project's success.

Communication: Effective communication is essential in the verification and measurement

process. Project stakeholders, including team members, management, and clients, need to be
kept informed about the project's status and any adjustments made based on measurements
and verifications.

Continuous Improvement: Verification and measurement provide valuable feedback for

continuous improvement. By analyzing project data and results, project teams can identify
areas where processes can be enhanced, efficiency improved, and outcomes optimized.