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Sequential experimentation for estimating the optimal delay of activities in PERT networks

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1 Author(s)
Buss, A.H. ; Dept. of Oper. Res., Naval Postgraduate Sch., Monterey, CA, USA

Applies the response surface methodology (RSM) utilizing simple fractional designs to optimize the expected present value (EPV) of a stochastic project network with respect to the delay of activities. Such a delay could increase the EPV by postponing negative cash flows, possibly at the expense of also delaying the final payment for the project. The problem was challenging, due to a combination of high variability with a relatively flat objective function near the optimum. Comparisons with the true optimal solutions, where available, indicated the robustness of the approach

Published in:

Simulation Conference Proceedings, 1995. Winter

Date of Conference:

3-6 Dec 1995

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