Sunday, May 14, 2006

When to use the resource loaded schedule?

This is a question asked in a planning & scheduling class I am taking. I think that resource loaded schedule will be in the following conditions. Please put your comments if you have any different opinions.

1. You have resource constraints. The resource availability to a project will affect your activity duration and thus the overall project duration. You need to put the resource limits to come up a realistic schedule.

2. You want to know the cost and schedule trade off. Depending on the resource used, you may have different schedule and the resource does affect the schedule. The productivity and cost rate typically go in reverse direction.

For example, the resource A, who costs $100 a day may produce 10 items each day and the resource B, who costs you $200 a day may produce 15 items. If you have 90 items to be produced, it tasks resource A 9 days and resource B only 6 days. By using a cost loaded schedule you know that bring the schedule shorten 3 days costs you (6x $200 - 9x $100 = $300).

3. You would like to do the Cash flow analysis

I would like to know when the cost will be expended ahead of time and prepare my cash flow accordingly. I can use the project schedule to tell me when my procured items will be delivered and thus my payment schedule to my contractors and suppliers. I should also put the milestones into the schedules for knowing when I can invoice my customers and thus the expected payments from my client. If my project is delayed, the material is ordered ahead of time, I need to notify the client and the supplier what to do. Either delay the delivery and the payment or ensure that I have enough cash to pay for it even I cannot invoice my client.

4. The resource loaded schedule is typically not used unless the client is required you to produce the reports. The federal projects may require you to do so.

5. I guess that you are required to do a resource loaded schedule if you want to perform the earned value analysis.
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