Case Problem 9.2Moore Housing ContractorsMoore Housing Contractors is negotiating a deal with Countryside Realtors to buil...
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Es 08 pert case 2

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Es 08 pert case 2

  1. 1. Case Problem 9.2Moore Housing ContractorsMoore Housing Contractors is negotiating a deal with Countryside Realtors to build six houses in a newdevelopment. Countryside wants Moore Contractors to start in the late winter or early spring when the weatherbegins to moderate and build through the summer into the fall. The summer months are busy time for the realtycompany, and it believes it can sell the houses almost as soon as they are ready – sometimes before. The housesall have similar floor plans and are of approximately equal size; only the exteriors are noticeably different. Thecompletion time is so critical for Countryside Realtors that it is insisting a project management network accompanythe contractor’s bid for the job with an estimate of the completion time for a house. The realtor also needs to beable to plan its offerings and marketing for the summer. The realtor wants each house to be completed within 45days after it is started. If a house is not completed within this time frame, the realtor wants to be able to chargethe contractor a penalty. Mary and Sandy Moore, the president and vice president of Moore Housing Contractors,are concerned about the prospect of a penalty. They want to be confident they can meet the deadline for a housebefore entering into any agreement with a penalty involved. (If there is a reasonable likelihood they cannot finish ahouse within 45 days, they want to increase their bid to cover potential penalty charges.) The Moores are experienced home builders, so it was not difficult for them to list the activities involved inbuilding a house or to estimate activity times. However, they made their estimates conservatively and tended toincrease their pessimistic estimates to compensate for the possibility of bad weather and variations in theirworkforce. Following is a list of the activities for building a house and the activity time estimates: TIME (DAYS)_________Activity Description Predecessors a m b__a Excavation, pour footers - 3 4 6b Lay foundation a 2 3 5c Frame and roof b 2 4 5d Lay drain tiles b 1 2 4e Sewer (floor) drains b 1 2 3f Install insulation c 2 4 5g Pour basement floor e 2 3 5h Rough plumbing, pipes e 2 4 7i Install windows f 1 3 4j Rough electrical wiring f 1 2 4k Install furnace, air conditioner c,g 3 5 8l Exterior brickwork I 5 6 10m Install plasterboard, mud, plaster j, h, k 6 8 12n Roof shingles, flashing l 2 3 6o Attach gutter, downspouts n 1 2 5p Grading d, o 2 3 7q Lay subflooring m 3 4 6r Lay driveway, walks, landscape p 4 6 10s Finish carpentry q 3 5 12t Kitchen cabinetry, sink, and appliances q 2 4 8u Bathroom cabinetry, fixtures q 2 3 6v Painting (interior and exterior) t, u 4 6 10w Finish wood floors, lay carpet v, s 2 5 8x Final electrical, light fixtures v 1 3 41. Develop a CPM/PERT network for Moore House Contractors and determine the probability that the contractorscan complete a house within 45 days Does it appear that the Moores might need to increase their bid tocompensate for potential penalties?2. Indicate which project activities Moore Contractors should be particularly diligent to keep on schedule bymaking sure workers and materials are always available. Also indicate which activities the company might shiftworkers from as the need arises.

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