SCHEDULING AND

RISK ANALYSIS
(CPM, PDM, PERT, GERT)
SCHEDULING AND RISK ANALYSIS

SCHEDULING SCHEDULE RISK ANALYSIS

▪ A schedule is commonly used in the project ▪ Schedule Risk Analysis (SRA) is a simple yet
planning and project portfolio management effective technique to connect the risk
parts of project management. information of project activities to the
baseline schedule, in order to provide
sensitivity information of individual project
▪ Scheduling of the programming planning activities to assess the potential impact of
and construction process is a vital tool in uncertainty on the final project duration and
both the daily management and reporting cost.
of the project progress.

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SCHEDULE RISK ANALYSIS

Four steps of Schedule Risk Analysis:

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SCHEDULE RISK ANALYSIS

Four steps of Schedule Risk Analysis:

STEP 1: Baseline Schedule

▪ The project baseline schedule serves as a point of
reference to which the simulated project progress of step
3 is compared to - construction of a project baseline
schedule involves the definition of start and finish times for
each project activity using earliest and latest start
calculations with or without the presence of limited
resources. There is a wide range of techniques available
(PERT, CPM, etc...).

= CONSTRUCTION OF AN ACTIVITY TIMETABLE

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SCHEDULE RISK ANALYSIS

STEP 2: Define risk/uncertainty

▪ construction of a project baseline schedule involves the
definition of start and finish times for each project activity
using earliest and latest start calculations with or without
the presence of limited resources. There is a wide range
of techniques available (PERT, CPM, etc...).

= DEFINE ACTIVITY TIME AND COST PROBABILITY

DISTRIBUTIONS

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SCHEDULE RISK ANALYSIS

STEP 3: Monte-Carlo simulations

▪ is a simple technique to quickly generate multiple runs
simulating real project progress. Each simulation run
generates a duration and cost for each project activity given
its uncertainty profile defined in step 2. During each
simulation run, the simulation engine records all project
schedules and critical paths during progress in order to be
able to measure the degree of activity sensitivity and the
expected impact of activity variation on the project
objective, as reported in step 4.
▪
= RUN MULTIPLE PROJECT PROGRESS
SIMULATIONS

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SCHEDULE RISK ANALYSIS

Four steps of Schedule Risk Analysis:

STEP 4: Sensitivity results

▪ The output of a schedule risk analysis is a set of measures
that define the degree of activity criticality and sensitivity.
These measures view of the critical path (which defines
that an activity is either critical or not) to a degree of
sensitivity, as follows:
- Criticality Index (CI): Measures the probability that an activity is on the
critical path.
- Significance Index (SI): Measures the relative importance of an activity.
- Schedule Sensitivity Index (SSI): Measures the relative importance of an
activity taking the CI into account.
- Cruciality Index (CRI): Measures the correlation between the activity
duration/cost and the total project duration/cost.
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= INTERPRET THE SENSITIVITY MEASURES
1. CPM
CRITICAL PATH METHOD
CRITICAL PATH METHOD
▪ It is a project modelling technique developed in the late 1950s by Morgan
R. Walker of DuPont and James E. Kelley Jr. of Remington Rand.

▪ Critical Path Method (CPM) is the most common mathematical

technique. CPM is used to predict project duration by analysing which
sequence of activities, or path, has the least amount of scheduling
flexibility.

▪ Once you have determined the early and late start and finish dates, you
can determine float. Float is equal to the difference between the late
finish and early finish dates, or the difference between the late start
and early start dates.

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CRITICAL PATH METHOD

▪ To calculate an activity's duration, you subtract the

early start from the early finish or the late start from
the late finish. In example that follows, the numbers
indicate days.
activity A - 1 day
activity B - 2 days
Critical Path activities are,
activity C - 3 days
indeed critical to a project's
activity D - 2 days success any delays will result in
▪ Adding the total of the activity durations will give you the project going over the
the duration of the critical path. In this example, the anticipated completion date..
duration of the critical path would be 8 days.

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CRITICAL PATH METHOD

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2. PDM
PRECEDENCE DIAGRAM METHOD
PRECEDENCE DIAGRAM METHOD

▪ Precedence Diagram Method (PDM) is a visual representation technique

that depicts the activities involved in a project. It is a method of
constructing a project schedule network diagram that uses boxes/nodes
to represent activities and connects them with arrows that show the
dependencies.

▪ PDM was developed subsequent to the PERT/CPM techniques and its

function is to permit a more accurate depiction of relationships among
various activities.

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FOUR TYPES DEPENDENCIES

▪ Finish-Start: In this dependency, an activity cannot start before

a previous activity has ended. This is the most commonly used
dependency.
▪ Start-Start: In this dependency, there is a defined relationship
between the start of activities.
▪ Finish-Finish: In this dependency, there is a defined relationship
between the end dates of activities.
▪ Start-Finish: In this dependency, there is a defined relationship
between the start of one activity and the end date of a successor
activity. This dependency is rarely used.
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DEPENDENCIES DIAGRAM

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DEPENDENCIES DIAGRAM

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3. PERT
PROGRAM EVALUATION AND REVIEW TECHNIQUE
PROGRAM EVALUATION AND REVIEW
TECHNIQUE
▪ PERT is similar to critical path in that they are both used to
visualize the timeline and the work that must be done for a
project.

▪ However with PERT, you create three different time estimates

for the project: you estimate the shortest possible amount time
each task will take, the most probable amount of time, and the
longest amount of time tasks might take if things don’t go as
planned.

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DURATION ESTIMATES

▪ Optimistic time estimate (a): This is the shortest possible time in

which the activity can be completed, and assumes that
everything has to go perfect

▪ Realistic time estimate (m): This is the most likely time in which
the activity can be completed under normal circumstances

▪ Pessimistic time estimate (b): This is the longest possible time

the activity might require, and assumes a worst-case scenario
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EXAMPLE

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4. GERT
GRAPHICAL EVALUATION AND REVIEW TECHNIQUE
GRAPHICAL EVALUATION AND REVIEW
TECHNIQUE
▪ GERT essentially outdoes limitations associated with PERT/CPM
and allows loops between tasks. GERT is useful particularly in
experiments which demand higher degree of pre-planning and
rescheduling capabilities to maximize the return from the
experimental facilities available.

▪ GERT includes features such as probabilistic branching

(stochastic models), network looping (feedback loops), multiple
sink nodes (multiple outcomes), and multiple node realization
(repeat events) which are unavailable in PERT/CPM.
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TWO TYPES OF NODES

▪ DETERMINISTIC NODE – there are four possible outcomes each

with a probability of occurrence.

▪ PROBABILISTIC NODE – there are several alternatives may be

selected based on the associated probabilities.

GERT draw all possible probabilities, of estimates. It is good for iterative

estimates with feedback/loop back arrows.

GERT estimates are more complex and tend to be closer to actual as

compared to PERT. 23
DETEMINISTIC & PROBABILISTIC NODE

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EXAMPLE

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THANKS!
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