Australian Journal of Basic and Applied Sciences, 3(4): 3741-3756, 2009 ISSN 1991-8178 Corresponding Author: Dr Reza Ghodsi, Department of Industrial Engineering, College of Engineering, University of Tehran, P.O. Box 11155-45632, Tehran, Iran 3741 A New Practical Model to Trade-off Time, Cost, and Quality of a Project Reza Ghodsi, Mohammad Reza Skandari, Morteza Allahverdiloo, Seyed Hossein Iranmanesh Department of Industrial Engineering, College of Engineering, University of Tehran, Tehran, Iran Abstract: The three interrelated and conflicting objectives of any project are time, cost, and quality. In today’s competitive business environment, delivering projects in the least possible time, with maximum quality and minimum cost has got a critical issue for project managers. These objectives are dependent on the related features of the activities (i.e. time, cost, and quality) of that project. Since these features are also interrelated, different models have been introduced to define the relation among them. The existing relations in the literature propose that the quality of an activity varies dependently by its time decreasingly and therefore lack the generality that an activity can be executed with the least possible time and the best quality, although by spending more money. In this paper, first the general characteristics of a proper relation function are presented as six axioms. Then a new model to define the relation among features of an activity, practicable in real world projects is developed, that meets the stated characteristics. Then we developed a new mathematical trade-off model for the trio of objectives of a project based on the proposed model. To illustrate the applicability of the proposed model, a sample project is investigated, and the according time, Cost, and quality Pareto optimal front of the project is found using a recent version of the å-constraint method. Since the Pareto front is three dimensional, to provide insightful information that can help the managers in making trade-off decisions, quality, cost, and time contours of the Pareto surface are also provided. Key words: å-Constraint Method, Multi-Objective Decision Making, Project Scheduling, Time, Cost, Quality Trade-Off INTRODUCTION The American National Standard Institution (ANSI) defines project management as “ the application of knowledge, skills, tools, and techniques to project activities to meet project requirements”, PMI (2004). Project scheduling, an integral part of project management, is intended to balance the competing objectives of a project, while maintaining the project scope. The three fundamental objectives of project management are completion time (hereafter called time), total cost (hereafter called cost), and quality (Demeulemeester and Herroelen (2000)). The trio of project scheduling (see Figure 1) and consequently the trade-off among them has been the subject of several studies, so far. Fig. 1: The Trio of Project Objectives The critical path method (CPM) is a fundamental quantitative technique developed for project management. Assuming deterministic activity times, CPM determines the minimum time needed to complete the project. In the management of a project, it is often possible to compress the duration of some of the activities at an additional expense in order to reduce the total project’s duration, and generally there is a due date (or in some cases called soft deadline) for project completion; So a decision problem considered in the project management