ISACA COBIT 5 – Define (BOK IV) Part 9

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- January 26, 2023

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**23. Analytical Tools – Activity Network Diagrams (BOK IV.D.5) **

So coming to the next tool here, which is activity network diagram. Activity network diagram is used to manage a number of tasks in sequence. So if you have a number of things to do, number of tasks to do which are in sequence, then you use activity network diagram. So what you do is you list down all the tasks, what you have to do, task number one, task number two, task number three and the time each task is supposed to take. So task number one is going to take two days. Task number two is supposed to take four days. You list down that and you note down the predecessor and successor tasks. So if you have two tasks, task number A and task number B. So you finish task number A and then you go to task number B. Task number A is predecessor.

You need to complete task number A to go to task number B and task number B is successor here. And then it helps in identifying the bottlenecks, which is the bottleneck, which is the critical path, which is the path on which you should not be making compromise because if you make any delay in that path that will lead to overall delay in the project, we will talk about that. Let’s move on to the next slide to have more understanding on activity network diagrams.

In activity network Diagrams critical path method CPM is a commonly used method and as I talked on the previous slide that for activity network diagram we need to have activity what all activities we have. So here I have a table which tells me what all activities I need to complete for a project and then what is the duration of that and what it depends on. So it tells what is the predecessor of this particular activity.

So if I have to draw a network diagram of this, so what I will be doing is I will be having a starting point. So this is my starting point. Then I will have activity number A and activity number A is going to take two days and then I have activity B which is going to take four days. And as you see for activity B it depends on activity A and that’s what I have represented here. And then comes activity C which is depending on A. So I will have a activity C which is depending on completion of A and activity C takes one day. Then the next item here is activity D which is depending on activity B.

So here I have to draw activity number D which is depending on B and this takes two days and then I have activity E which depends on B and C. So here is my activity number E and this activity takes seven days and with this I complete my project. So here my project ends. So this is the start and this is the end of this project and this is how you draw activity network diagram where each box represents the activity and you note down the time or the duration of this activity and that’s what we have here.

So it includes a list of all activities which we have here ABCD time for each activity dependencies and endpoints such as a milestone and deliverable items. So we could have even had starting and ending here. So this could have been ending here, this could have been the starting point. So this is how you draw an activity network diagram. So as I earlier said, that critical path method CPM is a technique which is used in activity network diagram. Commonly used method is CPM and here I will be talking about two terms which are float and critical path. So if you have a number of activity which depends on each other interconnected and there is a starting and there is a ending point, there will be one path in that flow which is critical. And which is critical means any delay on that path will lead to project delay. But then there will be a number of other activities where you will have float or where you will have slack. So that is the time, even if you delay a particular activity by that many days it really doesn’t matter.

So for example, let’s take a simple example here we’ll be talking of our main example in the next slide but let’s say you have an activity A here and then you have an activity B and then you have a activity C and then you complete this project and here and you have a starting here. Activity A takes one day, activity B takes four days and activity C takes eight days. Now for project to end you should have B and C completed because they are in the path. Now if I have to complete activity number A and activity B and go to end it takes me five days from here to here and going from here to here it takes me one day for activity A and eight days for activity C.

So which takes me total nine days, five days here, nine days here. This activity, this sequence which is AC is the critical path because any delay here will delay my project. But for example if I delay my activity number B by four days, if activity B gets delayed by four days what’s going to happen? Nothing is going to happen because if activity B gets delayed by four days so instead of four days it’s going to take eight days and together with A and B it’s going to take nine days. So by the time AC will complete there’s a time for A and B to complete.

So A, B, even if activity B is delayed by four days it’s not going to affect the project and this is what is float. So there is a float of four days in activity B. So critical path is AC AC. AC is critical path because that is the path which takes the maximum time and float of B is four days. So four days as long as there is four days delay in activity B, still your project will be completed at the same time. So let’s look at this example here where we have five activities activity ABCDE and they have specific duration for each of these activities and activities depend on each other.

for example, activity B takes four days to complete and it depends on A. That means activity B cannot be started till activity A has been completed. So let’s draw a network diagram for this and then we will understand how do we calculate float and how do we find out critical path in this case. So let’s draw this. So here I have a starting point. So this is the start point and then I have an activity A.

So this is my activity A and if you are wondering why I have put four boxes on the corner we will talk about that and then coming to activity B and for activity B to start activity A should have been completed. So here I draw activity B. So activity A is predecessor and activity B is the successor of activity A. So there is a relationship between successor and predecessor. Successor is the first activity and the later activity is predecessor.

So here I have activity B and this takes activity A takes two days, activity B takes four days and then coming to activity C. Activity C also depends on activity A. So let’s draw here. So this becomes my activity number C. Again those four boxes which I’m keeping secret till now, I’ll be telling you what these four boxes are and then we draw activity D and activity D has dependence on activity B. So here I have to draw activity D. So this is my activity D. Again those four boxes and coming to activity E. Activity E depends on B and C both. So this is my activity E and my activity E depends on B and C both. So let’s draw that come arrow coming from C and arrow coming from B and the duration of activity C was one day, activity D was two days. Activity e was seven days.

And once all these are completed we reach the end point of the project. So this is my endpoint. Okay, so what do we have in these four boxes? Let’s look at that. Let’s draw one box here, these four corners, if you see these are early start and early finish and the bottom boxes are late start and late finish.

So these are early top two are early start and early finish. The bottom two are late start and late finish. Let’s understand that. So the project started on day zero. If the project started on day zero for activity A what is the earliest start? The earliest start of course will be the day zero. On day zero you can start the activity A and how much time activity A takes two days. So if a project which has been started on day zero which takes two days to complete, then the earliest finish for this project will be two days. Zero plus two is equal to two days.

So this was early start was zero and early finish was two days for activity A. Now coming to activity number B. So in B when we can have earliest start, the earliest start will be day two. Because on day two activity A will be completed and then only B can be started and B takes four days to complete. So the earliest finish for this activity will be day six, day two to start the activity and four days to complete. So two plus four is equal to six. Going forward two activity number D, d depends on activity B and B finishes on day six. So day six we can start activity number D and it takes two days to complete. So six plus two is equal to eight. So that’s earliest finish will be day eight. Coming to the bottom, looking at activity C, c can start on day two.

When activity A has been completed, takes one day to complete. So earliest finish will be three days. Since earliest finishes three days. Can we have activity E started on day three? No, because we cannot start activity E till both B and C have been completed. Even though C gets completed on day three, but the activity B doesn’t get completed which gets completed on day six. So this is the earliest we can start activity E when both B and C have been completed. And starting on day six takes seven days to complete. So activity E will get completed on day 13 and our project is going to take 13 days to complete. So this was early start and early finish. Now coming to late start and late finish, that calculation we do going backwards.

So early start and early finish we did calculation from starting to ending. Now to calculate the late start and late finish we need to do calculation backwards. So for early start and early finish we did from left to right and for late start and late finish we will do calculation from right to left. So projects finishes on day 13. So this is the latest these two activities which is D and E should be finished. So activity E should be finished latest by day 13 and same is with D. D also should be finished by day 13. Going backwards for activity E. Since the late finish is 13, then the latest start has to be seven days less out of that which is six days. Similarly for activity D which was the latest finish on day 13, then latest start has to be day eleven because this activity takes two days to complete.

So going backward to c since activity E has the latest start date six, so C should finish latest by day six and since C takes one day to complete so latest start has to be day five coming to activity number B. This is tricky because B should finish by day six because if B doesn’t get finished by day six, the latest finished by day six, it will affect activity number E. So you could have chosen eleven or six because since the D has the latest start of 11th day and E has the latest start of six days, you need to finish Activity B by day six. If you don’t do that activity E will get affected and which will affect the schedule of the project. So with this six as the latest finish, the latest start of this activity B will be day two. Now coming to activity A, activity A should be finished latest by day two because if you don’t do that activity B will get affected and since the latest finish is two days so latest start will be zero days. So this is how you create your network diagram. Now you’re looking at two things.

One is float and the second thing is critical path. So if you look at activity E for example, there is no float, there is a zero float because zero float means there is no gap between the earliest finish and late finish or earliest start and the late start there is no difference between these two. So that gives the float as zero float. So float could be calculated as float will be equal to latest finish minus earliest finish or this could equally be said as latest start minus early start. So for activity E we have a zero float, for activity C we have a float of three days float. So we have a three day’s float here in activity C because six minus three is equal to three. Similarly if you look at activity D we have five days float, activity B has no float or zero float. A has no float. So this is how you can calculate the float in the activity. That means if your activity C gets delayed, if instead of one day your activity C takes four days, not a problem that is not going to affect the overall schedule of the project or if your activity D gets delayed by five days that’s not a problem because D has five days of float.

The only thing which you need to monitor is your zero float activities do not get delayed because if your zero float activity gets delayed that will affect the overall schedule. So that means your critical path passes through zero float activities. So here zero float activities are A and then B and then E. This is your critical path, that’s your critical path. So if by giving this information of activity duration and dependence on if in your exam, if it is asked to find out what is the critical path? You can find out using this method. This might be a little bit longer to do that slowly if you become comfortable with this you can manually look at that and with that you can find out what is the critical path because critical path is the one which takes the longest time. So the easy way to do this in the exam would be something like this which I will be showing here. So you will have start activity A, activity B, activity C then you have activity E which takes from B and C and then you have activity D and this is the end. So if the same question comes in the exam this is how I would be doing that.

So activity A has two days, B has four days, D has two days, C has one day and E has seven day. I will be looking at the longest path of this, where is the longest path? So if I calculate A to C to E and end so this is going, this path is going to take two plus one plus seven is equal to so this path takes me ten days. Okay? But if I look at this path which is A, B, then B, E and end. So this takes me so let’s put it here, let’s say A-C-E this takes ten days. If I look at A-B-E this takes me two plus four plus 713 days. Other paths to go to end from start would be A, B and D which is taking two plus four plus two which is eight days and which of these is longest? So this is the longest. So I can quickly say that Abe is the critical path. That’s how I would do in a quick exam where I don’t have time otherwise when you have a big complex diagram then probably you might want to use this early start, early finish, late start, late finish. This is more useful for the complex network diagrams.

So earlier when we talked about activity network diagram in activity network diagram there could be two things CPM and Pert critical path method and pert which is program evaluation and review technique. We talked about CPM earlier we draw the network diagram, we found out the critical path, we found out the float. The key difference between CPM and Pert is the duration of the activity. So earlier we said that activity A will be taking two days, activity B will be taking three days but in reality that is not the fact. You cannot say that activity A will take two days or four days. You say with some sort of a certainty that there is a good chance that activity A will get completed in two days. If everything works well under the most optimum condition that activity A could be completed in one day instead of two days or if things go bad then the worst case would be that activity A will be taking four days. So in part you use the probabilistic approach of estimating the activity time.

So you have three things for each activity. Instead of saying activity A is going to take two days, you will say that activity A optimistic time is two days. Most likely time is three days and the most pessimistic time is, let’s say seven days is the worst case. This might take up to seven days. So this is how you will be representing the time for each activity in the port. And once you have these numbers, then you can calculate a single number which is expected time using this formula. So expected time would be expected time is equal to optimistic plus four into most likely plus pessimistic time divided by six. So in this above example, if the optimistic time is two days plus four into most likely days, most likely is three. So four into three is equal to twelve days plus the most pessimistic is seven days divided by six. So this comes out to be the expected time which is here is 21 by six days is equal to 3. 5 days.

So this is how you calculate the expected time from the optimistic most likely and pessimistic time in part. So on the previous slide we took an activity A. So A had optimistic time of two days, most likely time of three days and the pessimistic time of seven days. So we calculated that the expected time is expected time was equal to optimistic plus four into most likely plus pessimistic divided by six. And this we did earlier on the previous slide and we found out that the expected time is 3. 5 days. But if you are looking for standard deviation for this, the standard deviation for this activity is calculated by standard deviation is equal to pessimistic minus optimistic divided by six. So this is another thing which you might expect in your exam or which you might need to understand in your own working field. So here in the same example, we have a pessimistic time of seven days minus optimistic time of two days divided by six. So five divided by six is equal to zero point, so which comes out to be zero point 83 days. So this will be the standard deviation. So from optimistic most likely and pessimistic you can calculate the average or the expected time and you can calculate the standard deviation.

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