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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
WORK IMPROVEMENT PROJECT
CRITICAL PATH ANALYSIS -
TO REDUCE DELIVERY TIMES IN
SHIPBUILDING COMPANY
M/S GOA SHIPYARD LTD.
BY
SUYOG POWAR – 34
UNDER THE GUIDANCE OF –
PROF. RAJ AMONKAR
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
ACKNOWLEDGEMENT
I take this opportunity to thank Prof. Raj Amonkar who has
been instrumental in motivating me and guiding me all
through this work improvement project.
I also would like to thank the Officer In-charge (Outfitting
Hull section) of Goa Shipyard Ltd. for allowing me to carry
out this study and providing the required assistance and
guidance for successfully completing this project.
Suyog Anand Powar
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
PROJECT SYNOPSIS
In today’s world of increasing competition, it is very essential that one make’s the best
use of the scarce resources that is available. Shipbuilding Industry in India is a very
labour intensive industry and hence a small reduction in production time can result in
huge savings. Also, with Indian Shipyards competing globally for foreign orders it is
imperative that they deliver ships on time. Indian Shipyards over the past have been
suffering because of their inability to maintain delivery schedules and is therefore unable
to take advantage of the low labour costs as compared to other shipyards around the
world.
In this project, I have taken up M/s Goa Shipyard Limited, India’s premier defence
shipyard to study the production time and the benefits that can be reaped from doing so. I
shall be using critical path analysis as a tool in achieving this objective and shall also
bring into light the costs involved in doing so along with the conclusions and
recommendations.
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
EXECUTIVE SUMMARY
With the large boom in the shipbuilding industry, and the requirement of new vessels in
Indian navy and Indian Coast Guard, Goa Shipyard Limited is forced to deliver ships
ahead of schedule so as to get orders ahead of its competitors Mazagon Dock Limited,
Mumbai and Garden Reach Shipbuilders & Engineers, Kolkata. In view of this, we are
making an attempt to understand the critical path involved in the construction of hull,
which is a major requirement for launching of the vessel. Also, we shall attempt to apply
the concept of project crashing so as to reduce the time required for delivery of the ship,
and hence ensure more orders for Goa Shipyard Limited.
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
TABLE OF CONTENTS
SR. NO.
TITLE PAGE NO.
1 Profile – Goa Shipyard Limited 62 Methodology Involved 113 Introduction – Critical Path Analysis 124 Data Collection 155 Network Construction 166 Project Crashing 187 Analysis 238 Conclusion 249 Recommendations 2510 List of figures/tables 26
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
COMPANY PROFILE:
Goa Shipyard Ltd, an ISO 9001 : 2000 Company is one of the leading shipbuilding yards
on the west coast of India. Goa Shipyard Limited (GSL) was established in 1957 is today
a leading shipyard on the West Coast of India, meeting the exact requirements of varied
customers in the field of design, development, construction, repair, modernisation, testing
and commissioning of ships.
Initially, it was started as a small barge building yard. However, GSL has grown in
reputation as one of the most sophisticated ship builders in the country.
The inherent strengths of GSL are:
CAD/CAM centre.
State-of-the-art manufacturing facilities
A work force of over 2000 skilled personnel.
Over 175 qualified engineers and naval architects.
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
GSL, can not only build traditional military ships and marine crafts, but also next
generation vessels - Surface Effect Ships, Hovercrafts, High Speed Aluminum Hulled
Vessels, Pollution Control Vessels, Advance Deep sea Trawlers, Fish Factory vessels,
Catamarans, Pleasure submarines and offers a whole range of marine products and
services.
SERVICES PROVIDED
1) SHIPBUILDING
GSL, undertakes design, construction of a wide range of ships. Namely, Advanced
Offshore patrol vessels, Missile crafts, Extra fast attack crafts, Fast patrol vessels,
Offshore patrol vessels, passenger vessels, landing crafts, survey vessels, and Oil tanker.
2) SHIP REPAIRS AND REFIT
GSL has been providing ship repair and refit services right from its inception in 1957, as
a small barge repairing yard. Over the years GSL has diversified into repairs of various
kinds of vessels. Namely Tugs, survey vessels, fast patrol vessels, extra fast attack crafts,
Advanced offshore patrol vessels, Landing craft utility vessels, Passenger vessels and
Sail training ships.
Ship repair and refits range from routine maintenance, repair and surveys to major steel
renewal, engine replacement, total machinery overhaul and extensive damage repair.
The repair division is ably supported by a team of naval architects and engineers. In-
house welders, pipe fitters, structural fitters, electricians and carpenters are employed to
ensure high quality, cost efficiency and rapid turn-around.
By using standard equipment and developing an excellent rapport with a worldwide
network of suppliers, GSL has devised a rapid response program for expeditious supply
of spare parts and prompt service, thus cutting down costly down time.
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
3) SHIP MODERNISATION/ SHIP CONVERSION
The shipyard offers the facility of ship modernization and conversion which is fast
gaining precedence over new construction. Services ranging from replacing weapons and
sensors to reengineering and installing CCD (Camouflage Concealment and Deception)
technology on platforms enabling combatants to increase the role worthiness and punch
of existing platforms, exponentially. GSL also undertakes mid-life modernization and
conversion of ships.
4) GENERAL ENGINEERING WORKS
Some of the areas of general engineering works carried out at GSL are :
a) Controllable Pitch Propellers (CPP) System
1. Marketing, Procurement & Sales of CPP Systems and spares
2. Indigenisation of CPP equipments & spares
3. After sales services and providing assistance to customers for vessels with stern
gear systems.
4. In house Assembly & Testing and tuning of CPP System, before supplying to the
customers.
5. Co-ordination in respect of design, manufacturing, inspection, supply of CPP
Systems and spares
b) Damage Control Simulator:
To Supervise the execution of DCS work and conduct final trials of DCS.
c) Remote Control System:
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
1. Product support to Navy, Coast Guard by way of supply of spares and services for
routine maintenance and major overhauls.
2. Indigenization and remote control system wherever applicable / required.
FACILITIES AT GSL
BUILDING BAYS
GSL has three large self supporting all weather building bays with a working floor area
over 10,000 sq.m. With a maximum length of 200 m, an inside width of 25 m. and
craneage capacity of upto 40 tonnes, these bays are fully equipped for construction,
modernisation and repair of all types of naval crafts and medium sized commercial
vessels.
SLIPWAYS
GSL has four slipways having dimensions 216M x 22M, 182M x 22M, 119M x 29.6M
and 79M x 19.6M] Capable of launching and docking vessels having drafts upto 5M and
docking weight upto 2500tons.
OUTFITTING JETTY
The 180 m. long jetty is equipped to carry out outfitting and basin trials of ships to the
highest ship building standards.
STEEL PREPARATION SHOP
Complementing the hull fabrication bays is a modern steel preparation shop equipped
with CNC Plasma cutting machines, automated shot blasting and priming plant and
processor-controlled bending machines. Steel, Aluminium and other non- ferrous plates
are cut by computer controlled plasma arc cutting machines for a precise fit and finish.
ALUMINIUM FABRICATION SHOP
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
Aluminium alloy fabrication and welding procedures are blended with new ship
construction processes with the installation of an exclusive aluminium workshop. Highly
skilled technicians and production workers ensure consistently high quality of output.
CAD/ CAM
GSL's CAD/CAM centre has state-of-the-art computer hardware and world class
TRIBON shipbuilding software. All production information from the CAD/CAM centre
is directly fed to the CNC steel cutting and pipe bending machines. To enhance
productivity, GSL is adopting “Modular Construction Techniques".
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
METHODOLOGY INVOLVED
Firct of all, we have divided the ship into a number of blocks. Each block will have the
same activities. These blocks are simultaneously manufactured so as to reduce the time.
For e.g. In the normal case, upper decks can be fabricated only when the lower decks are
ready. This affects the manpower utilization thus resulting in huge losses. Now, if all the
blocks are manufactured independently and then assembled a lot of valuable time will be
saved. Here, due to limitation of time we shall do the Critical Path Analysis of only one
block and the same may be applied to the other blocks.
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
INTRODUCTION - CRITICAL PATH ANALYSIS
NEED FOR SYSTEMATIC APPROACH
A project, be it a construction work, or design and development of a prototype or any
turnkey project consists of a large number of activities whose scheduling by conventional
methods is difficult. Projects that are not scheduled properly generally tend to extend
beyond the contract period which in turn results in:
Increased investment in work in progress
Delay in invoicing thus reducing working capital
Increases fixed manufacturing expenses as men and machines are employed
beyond the economic time span
A number of scientific tools are available for planning but the planning of rojcts is best
performed through a well-known technique called Critical Path Analysis.
WHAT IS CRITICAL PATH ANALYSIS?
Critical Path Analysis is a synthesis of two independent techniques: Programme
Evaluation and Review Technique (PERT) and Critical Path Method (CPM). PERT was
developed by Naval Engineers of USA Navy in charge of Polaris Sub-marine Missile
Project in 1958. CPM was developed by Morgan Walker of Du Pont and James Kelly of
Ramington Rand (USA) in 1957 for use in planning and scheduling of the construction of
a chemical plant.
Though the two techniques were developed independently, they have many features in
common and are now combined into a technique called Critical Path Analysis (CPA).
DIFFERENCES BETWEEN PERT NETWORK AND CPM NETWORK:
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
1. PERT is event oriented while CPM is activity oriented
2. PERT provides for an allowance for uncertainty while CPM does not.
3. Activity times in CPM technique are related to costs while it is not so in PERT
since it is event oriented.
ADVANTAGES OF CRITICAL PATH ANALYSIS
1. Forces a thorough pre-planning. Each and every activity comprising a project is
identified and recorded.
2. Increases coordination of tasks as technological relationships between the
activities suggest which activities can run simultaneously and which should
succeed others.
3. Helps computations of different project durations for different level of resources
and thereby select a plan that minimizes total project cost.
4. Indicates optimal start and finish times of each activity of the project
5. Defines areas of responsibility of different departmental heads for timely
execution of the project
6. Facilitates progress reporting and limits unnecessary discussion at the progress
meetings to minimum
7. Identifies trouble spots often in advance and applies remedial measures.
8. Enables plan to be revised in accordance with changing circumstances
9. Helps prevent cost overruns.
STEPS IN USE OF CRITICAL PATH ANALYSIS:
1. Activity Identification: Break down a project into a set of identifiable activities.
2. Activity Relationships: Establish technological relationships between activities.
3. Network construction: Construct an arrow diagram called network
4. Activity Time Estimation: Estimate time duration of each activity of the project.
5. Network Time Analysis and Activity Float Analysis: Identify critical path, critical
activities and slack of non-critical activities.
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
6. Probability Aspects of Project Planning: If the activity times are deterministic,
find the expected duration of the project. If no, find the expected duration of the
project and the probability of completing the project by a target date.
7. Project Crashing: Collect activity time cost data. i.e. In case of repetitive projects
where in time and cost of each activity is known with certainty, crash the project
to its minimum duration.
8. Resource Allocation and Resource Levelling: Review resource requirements and
ensure that resource requirement of all activities does not exceed resource
availability and requirement of the resource during the duration of the project is as
uniform as possible.
9. Project Scheduling: Prepare a time schedule for the activities of the project.
10. Project Monitoring: Review progress periodically and expedite, if required.
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
DATA COLLECTION
BLOCK BUILDING ACTIVITIES:
The list of activities along with their sequence of occurrence and the duration taken by
each activity as per the discussion held with Officer in Charge (Hull) is as follows:
Activity
Code
Activity Description Depends
On
Duration in days
A1 Drawings for the block - 15 days
A2 Draw materials from stores A1 3 days
A3 Cutting of plates for skids of block A2 2 days
A4 Cutting for plates for block A2 3 days
A5 Floor marking for block and skid
erection
A1 6 days
A6 Fabrication and erection of skid
for block
A3, A5 8 days
A7 Inspection of skid by Quality A6 2 days
A8 Fabrication of Components A4 10 days
A9 Running welding of components A8 7 days
A10 Assembly of components A7, A9 10 days
A11 Inspection prior welding by
Quality and class surveyor
A10 2 days
A12 Rectifications of Dry survey
defects by Quality and Class
Surveyor
A11 7 days
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
A13 Final welding of block A12 8 days
A14 Releasing of block A13 3 days
A15 Shifting of block to erection site A14 2 days
TABLE 1
NETWORK CONSTRUCTION:
A network is a graphical representation of activities comprising the project. The
network is formed by a series of connected arrows and circles which give
technological relationships to the activities involved.
The most common approach in drawing a network is to start with the first activity and
draw the subsequent activities as per relationships. It consist of the following 7 steps:
1. Prepare a list of activities of the project.
2. Establish technological relationships between the activities. List all the
activities in the sequence in the second column and the corresponding
activities on which they depend in the first column.
3. Connect the first activity in the first column to the activity opposite to it in the
second column. Locate the activity connected back into the first column and
join this activity to the activity opposite to it in the second column. Rrepeat
the process till one sequence is covered which gets first activity chain.
4. Start with the next activity from the top in the first column which has not been
connected in the first sequence and follow up step (3) complete the sequence
to obtain next activity chain.
5. Repeat step (4) over and over again until all activities in the first column have
been connected.
6. Build up network from activity chains.
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
FIG. 1
Page 17 of 28
A1
A3
A6
A7
A2
A14
A11
A12
A13
A10
A15
A5
A9
A8
A4
2
3
8
7
2
10
2
8
2
3
15
6
3
10
7
Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
PATH LENGTH OF TIME (IN DAYS)
A1-A2-A3-A6-A7-A10-A11-A12-A13-A14-A15 15+3+2+8+2+10+2+7+8+3+2 = 62
A1-A5- A7-A10-A11-A12-A13-A14-A15 15+6+2+10+2+7+8+3+2 = 55
A1-A2-A4-A8-A9- A11-A12-A13-A14-A15 15+3+3+10+7+2+7+8+3+2= 60
Hence, the first path is the critical path because it requires the longest time i.e. 62 days
for completion.
PROJECT CRASHING
Critical path measures the expected duration of the project and identifies the activities or
the events which need attention in completing the project. In some cases, it is desirable to
cut down the total project time. This aspect of project planning is called project crashing.
Project Crashing may be carried out for one or more of the following objectives:
1. To complete the project in the least possible time. E.g. defense projects where
cost is of less importance and time is the most important factor
2. To effect cost economy i.e. to reduce the project cost below its normal cost
3. To expedite one or more remaining activities when earlier critical activities
have taken more than estimated time and thereby prevent penalties and cost
overruns.
4. To reduce idle time o the facilities in the non-critical paths and achieve
uniformity in requirement of resources.
5. To release the facilities more quickly for transfer to other profitable projects.
6. To enhance reputation of the firm and thereby improve its competitive
position.
The reduction in duration of activities may be achieved by
1. allocating more manpower and machines than originally planned for
2. working additional shift or overtime
3. awarding work to vendors who charge extra but expedite deliveries
A major advantage of CPM is its ability to evolve a relationship between time and cost of
the activity and it is the concept which is exploited in project crashing.
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
TIME COST RELATIONSHIP
Project Cost like time management plays an important role in any project. The project
costs can be classified into 2 groups: project direct costs and project indirect costs.
Project direct costs represent the sum of the direct activity costs.
Project indirect costs are the costs related to the entire duration of the project. The project
indirect costs increase/decrease directly with increase/decrease in the project completion
time. The indirect costs include costs of indirect labour, salaries and customary overhead,
interest payable on the capital, penalty due to late completion of the project, loss of
business, and others.
Project total cost therefore, are different for different project completion times. The
project completion time for which sum of these two costs is minimum is called optimal
project duration.
Terminology:
1. Normal Time (tn) – of an activity represents the expected duration of the activity.
2. Crash Time (tc) – of activity represents the irreducible minimum time required to
complete an activity
3. Normal Cost (Cn) – of an activity represents the lowest possible direct cost
required to complete an activity within its crashed time.
4. Crash Cost (Cc) – of an activity represents the lowest possible direct cost required
to complete an activity within its crashed time.
5. Activity cost slope (C/T) is the additional cost to be incurred to reduce the
duration of an activity by one unit of time.
Graphical Representation of Project Costs:
The sum of direct and indirect costs if plotted gives rise to a dome shaped curve implying
that total cost of the project reduces with the decrease in its duration and then steadily
increases with further decrease in the project duration. The project duration for which the
total cost is minimum is called optimum duration.
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
FIG. 2
TABLE 2
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
The critical path is A1-A2-A3-A6-A7-A10-A11-A12-A13-A14-A15 and the normal
duration of the project = 62 days. To complete the project in 62 days, each of the
activities is to be completed within its normal duration. The direct cost of the project can
be obtained by adding the normal costs of all the activities. This equals to Rs. 6,12,000/-
In the critical path, activity A7 has the lowest cost slope. This activity can be crashed by
1 day. New project duration= 62-1 = 61 days
New project cost = Rs. 612000 + Rs. 1 X 2000
= Rs. 614000
However, A1-A2-A3-A6-A7-A10-A11-A12-A13-A14-A15 still remains to be the critical
path. Hence, the next activity which has the lowest cost slope is A11. This activity can be
crashed by 1 day. New project duration = 61-1 = 60 days
New project cost = Rs. 614000 + Rs. 1 X 2000
= Rs. 616000
A1-A2-A3-A6-A7-A10-A11-A12-A13-A14-A15 still remains to be the critical path.
Hence the next activity with the lowest cost slope is A2. This activity can be crashed by 1
day. New project duration= 60-1 = 59 days
New project cost = Rs. 616000 + Rs. 1 X 3000
= Rs. 619000
A1-A2-A3-A6-A7-A10-A11-A12-A13-A14-A15 still remains to be the critical path.
Hence the next activity with the lowest cost slope is A3. This activity can be crashed by 1
day. New project duration= 59-1 = 58 days
New project cost = Rs. 619000 + Rs. 1 X 4000
= Rs. 623000
Now, we have 2 critical paths: A1-A2-A3-A6-A7-A10-A11-A12-A13-A14-A15 & A1-
A2-A4-A8-A9- A11-A12-A13-A14-A15 each with duration of 58 days. Activity A12 can
be crashed by 2 days while activity A9 of second critical path can be crashed by 2 days.
Hence, the entire duration can be crashed by 2 days
New project duration= 58-2 = 56 days
New project cost = Rs. 623000 + Rs. 2 X (4000+4000)
= Rs. 639000
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
The table for the same can be obtained as shown below:
TABLE 3
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
ANALYSISWith the data above, we shall prepare the project-time cost matrix so as to obtain the
optimal duration of the project.
TABLE 4
Time Cost Relationship
0
200000
400000
600000
800000
1000000
1200000
1400000
0 20 40 60 80
Days
Co
st p
er D
ay
Direct Cost
Indirect Cost
Project Cost
FIG. 3
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
CONCLUSION:
From the table it can be seen that the project cost is minimum when the project duration
is 46 days. Hence the results can be summarized as follows:
Normal Duration of the project = 62 days
Crashed Duration of Project = 44 days
Optimal Duration of Project = 46 days
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
RECOMMENDATIONS
1. Sophisticated machinery:
Use of automated and semi-automatic welding machines can definitely reduce the
duration required for fabrication and welding activity.
2. Scheduling of Activities:
Proper planning and scheduling of activities can save a lot of time especially for
activities such as collection of material from stores and inspection by class
surveyor.
3. Efficient Design:
Use of sophisticated drawing software such as Catia or tribon can make work
more efficient and hence reduce number of defects arising at the time of
inspections. Also, use of such a software reduces re-work to a large extent.
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
LIST OF FIGURES/TABLES
1. Table 1 – Block Building Activities with Duration in Days
2. Figure 1 – Network Diagram for Block Building Activities
3. Figure 2 – Time Cost Relationship
4. Table 2 – Calculation of cost Slope for each Activity
5. Table 3 – Crashing of Activities
6. Table 4 – Total Project Cost Calculation
7. Figure 3 – Time Versus Cost Relationship
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
BIBILIOGRAPHY
1. Chase, Jacobs, Aquilano - Operations Management for Competitive Advantage
2. www.mindtools.com/critpath.html
3. en.wikipedia.org/wiki/Critical_path
4. www.bizhelp24.com/small-business-portal/critical-path-analysis-project-management
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Critical path Analysis – Reduce Delivery Times in M/s Goa Shipyard Limited
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