PROJECT MANAGEMENT

CPM/PERT
 Project

 “A project is a series of activities directed

to accomplishment of a desired objective.”

Plan your work first…..then work

your plan
Network analysis
Introduction

Network analysis is the general name given to certain specific

techniques which can be used for the planning, management and
control of projects.
One definition of a project:
“A project is a temporary endeavour undertaken to create a "unique"
product or service”
  Developed in 1950’s

History CPM by DuPont for chemical plants


 PERT by U.S. Navy for Polaris missile

CPM was developed by Du Pont and the emphasis was on the

trade-off between the cost of the project and its overall
completion time (e.g. for certain activities it may be possible
to decrease their completion times by spending more money -
how does this affect the overall completion time of the
project?)

PERT was developed by the US Navy for the planning and control of
the Polaris missile program and the emphasis was on completing the
program in the shortest possible time. In addition PERT had the
ability to cope with uncertain activity completion times (e.g. for a
particular activity the most likely completion time is 4 weeks but it
could be anywhere between 3 weeks and 8 weeks).
 CPM - Critical Path Method

 Definition: In CPM activities are shown as a network of

precedence relationships using activity-on-node network
construction
– Single estimate of activity time
– Deterministic activity times

USED IN : Production management - for the jobs of

repetitive in nature where the activity time estimates can
be predicted with considerable certainty due to the
existence of past experience.
 PERT -
Project Evaluation & Review Techniques

 Definition: In PERT activities are shown as a network of

precedence relationships using activity-on-arrow network
construction
– Multiple time estimates
– Probabilistic activity times

USED IN : Project management - for non-repetitive jobs

(research and development work), where the time and cost
estimates tend to be quite uncertain. This technique uses
probabilistic time estimates.
 Gantt chart

Originated by H.L.Gantt in 1918

Advantages Limitations
- Gantt charts are quite commonly used. - Do not clearly indicate details regarding
They provide an easy graphical the progress of activities
representation of when activities (might)
take place. - Do not give a clear indication of
interrelation ship between the separate
activities
 CPM/PERT

These deficiencies can be eliminated to a large extent by

showing the interdependence of various activities by means of
connecting arrows called network technique.

 Overtime CPM and PERT became one technique

 ADVANTAGES:
– Precedence relationships
– large projects
– more efficient
 The Project Network

 Use of nodes and arrows

Arrows  An arrow leads from tail to head directionally

– Indicate ACTIVITY, a time consuming effort that is required to
perform a part of the work.

Nodes  A node is represented by a circle

- Indicate EVENT, a point in time where one or more activities start
and/or finish.
 Activity on Node & Activity on Arrow

Activity on Node Activity on Arrow

- A completion of an activity - An arrow represents a task,

is represented by a node while a node is the
completion of a task
- Arrows represent order of
events
 Activity Slack

Each event has two important times associated with it :

- Earliest time , Te , which is a calendar time when a event can
occur when all the predecessor events completed at the earliest
possible times
- Latest time , TL , which is the latest time the event can occur with
out delaying the subsequent events and completion of project.

 Difference between the latest time and the earliest time of an event
is the slack time for that event

Positive slack : Slack is the amount of time an event can be delayed

without delaying the project completion
 Critical Path

 Is that the sequence of activities and events where there is no

“slack” i.e.. Zero slack

 Longest path through a network

 minimum project completion time
 Benefits of CPM/PERT

 Useful at many stages of project management

 Mathematically simple
 Give critical path and slack time
 Provide project documentation
 Useful in monitoring costs
 Questions Answered by CPM & PERT

 Completion date?
 On Schedule?
 Within Budget?
 Critical Activities?
 How can the project be finished early at the least cost?
 example
Illustration of network analysis of a minor redesign of a product and
its associated packaging.

The key question is: How long will it take to complete this project ?
For clarity, this list is kept to a minimum by specifying only
immediate relationships, that is relationships involving activities
that "occur near to each other in time".
 Before starting any of the above activity, the questions
asked would be

•"What activities must be finished before this activity can start"

•could we complete this project in 30 weeks?

•could we complete this project in 2 weeks?

One answer could be, if we first do activity 1, then activity 2, then activity
3, ...., then activity 10, then activity 11 and the project would then take the sum
of the activity completion times, 30 weeks.

“What is the minimum possible time in which we can complete this project ? “
We shall see below how the network analysis diagram/picture we construct
helps us to answer this question.
CRITICAL PATH TAKES 24 WEEKS FOR THE COMPLETION OF THE PROJECT
Packages are available to determine the shortest path
and other relevant information.
Data entry window
Output of the package
 Limitations to CPM/PERT

 Clearly defined, independent and stable activities

 Specified precedence relationships
 Over emphasis on critical paths
Thank you
 References
V P B Chakravarthi . K
 Abhijeet Kumar
PERT Vs CPM
 INTRODUCTION
• Schedule converts action plan into operating
time table
• Basis for monitoring and controlling project
• Scheduling more important in projects than
in production, because unique nature
• Sometimes customer specified/approved
requirement-e.g: JKR projects
• Based on Work Breakdown Structure (WBS)

Chapter 8 Scheduling, PERT, Critical Path Analysis 27

 NETWORK TECHNIQUES

PERT CPM
-Program Evaluation and Critical Path Method
Review Technique Developed by El Dupont
- developed by the US for Chemical Plant
Navy with Booz Shutdown Project- about
Hamilton Lockheed same time as PERT
- on the Polaris
Missile/Submarine
program 1958

Both use same calculations, almost similar

Main difference is probabilistic and deterministic in time
estimation
Gantt
Chapter 8 Chart also usedScheduling,
in scheduling
PERT, Critical Path Analysis 28
 NETWORK

• Graphical portrayal of activities and event

• Shows dependency relationships between
tasks/activities in a project
• Clearly shows tasks that must precede
(precedence) or follow (succeeding) other tasks
in a logical manner
• Clear representation of plan – a powerful tool for
planning and controlling project

Chapter 8 Scheduling, PERT, Critical Path Analysis 29

 Example of Simple Network –
Survey

Chapter 8 Scheduling, PERT, Critical Path Analysis 30

 Example of Network –
More Complex

Chapter 8 Scheduling, PERT, Critical Path Analysis 31

 DEFINITION OF TERMS IN A NETWORK
• Activity : any portions of project (tasks) which required
by project, uses up resource and consumes
time – may involve labor, paper work,
contractual negotiations, machinery operations
Activity on Arrow (AOA) showed as arrow, AON
– Activity on Node
• Event : beginning or ending points of one or more
activities, instantaneous point in time, also
called ‘nodes’

• Network : Combination of all project activities and the events

PRECEEDING SUCCESSOR
ACTIVITY

EVENT

Chapter 8 Scheduling, PERT, Critical Path Analysis 32

 Emphasis on Logic in Network Construction
• Construction of network should be based on logical or
technical dependencies among activities
• Example - before activity ‘Approve Drawing’ can be
started the activity ‘Prepare Drawing’ must be
completed
• Common error – build network on the basis of time logic
(a feeling for proper sequence ) see example below

WRONG !!!
CORRECT 
Chapter 8 Scheduling, PERT, Critical Path Analysis 33
 Example 1- A simple network
Consider the list of four activities for making a simple product:

Activity Description Immediate

predecessors
A Buy Plastic Body -
B Design Component -
C Make Component B
D Assemble product A,C

Immediate predecessors for a particular activity are the activities

that, when completed, enable the start of the activity in question.

Chapter 8 Scheduling, PERT, Critical Path Analysis 34

 Sequence of activities
• Can start work on activities A and B anytime, since
neither of these activities depends upon the
completion of prior activities.
• Activity C cannot be started until activity B has been
completed
• Activity D cannot be started until both activities A and
C have been completed.
• The graphical representation (next slide) is referred to
as the PERT/CPM network

Chapter 8 Scheduling, PERT, Critical Path Analysis 35

 Network of Four Activities

Arcs indicate project activities

A D
1 3 4

B C

Nodes correspond to the beginning

and ending of activities

Scheduling, PERT, Critical Path

Chapter 8 36
Analysis
 Example 2
Develop the network for a project with following activities and
immediate predecessors:
Activity Immediate
predecessors
A -
B -
C B
D A, C
E C
F C
G D,E,F

Try to do for the first five (A,B,C,D,E) activities

Chapter 8 Scheduling, PERT, Critical Path Analysis 37
 Network of first five activities

A D
1 3 4

E
B

C 5
2
We need to introduce
a dummy activity

Chapter 8 Scheduling, PERT, Critical Path Analysis 38

 Network of Seven Activities
1 A 3 D 4 G
7
dummy E
B
C 5 F
2 6
•Note how the network correctly identifies D, E, and F as the
immediate predecessors for activity G.

•Dummy activities is used to identify precedence relationships

correctly and to eliminate possible confusion of two or more
activities having the same starting and ending nodes
•Dummy activities have no resources (time, labor, machinery, etc) –
purpose is to PRESERVE LOGIC of the network
Chapter 8 Scheduling, PERT, Critical Path Analysis 39
 EXAMPLES OF THE USE OF DUMMYACTIVITY
Network concurrent activities
a
a
2

1 2 1 Dummy

b 3
b
WRONG!!! RIGHT 

Activity c not WRONG !

required for e
a
a e
d
1
b 1 b
e
d
c
2
c
WRONG
RIGHT
!!!

RIGHT 

Chapter 8 Scheduling, PERT, Critical Path Analysis 40

 WRONG!!! RIGHT!!!

a d a d
1 1

b e b
2 2 4
e

c f c f
3 3

a precedes d.
a and b precede e,
b and c precede f (a does not precede f)

Chapter 8 Scheduling, PERT, Critical Path Analysis 41