PERT/CPM for Project Scheduling & Management

1. INTRODUCTION
Basically, CPM (Critical Path Method) and PERT (Programme Evaluation Review Technique) are project
management techniques, which have been created out of the need of Western industrial and military establishments
to plan, schedule and control complex projects.

1.1 Brief History of CPM/PERT

CPM/PERT or Network Analysis as the technique is sometimes called, developed along two parallel streams, one
industrial and the other military.
CPM was the discovery of M.R.Walker of E.I.Du Pont de Nemours & Co. and J.E.Kelly of Remington Rand, circa
1957. The computation was designed for the UNIVAC-I computer. The first test was made in 1958, when CPM was
applied to the construction of a new chemical plant. In March 1959, the method was applied to a maintenance shut-
down at the Du Pont works in Louisville, Kentucky. Unproductive time was reduced from 125 to 93 hours.
PERT was devised in 1958 for the POLARIS missile program by the Program Evaluation Branch of the Special
Projects office of the U.S.Navy, helped by the Lockheed Missile Systems division and the Consultant firm of Booz-
Allen & Hamilton. The calculations were so arranged so that they could be carried out on the IBM Naval Ordinance
Research Computer (NORC) at Dahlgren, Virginia.

1.2 Planning, Scheduling & Control

Planning, Scheduling (or organising) and Control are considered to be basic Managerial functions, and CPM/PERT
has been rightfully accorded due importance in the literature on Operations Research and Quantitative Analysis.
Far more than the technical benefits, it was found that PERT/CPM provided a focus around which managers could
brain-storm and put their ideas together. It proved to be a great communication medium by which thinkers and planners
at one level could communicate their ideas, their doubts and fears to another level. Most important, it became a useful
tool for evaluating the performance of individuals and teams.
There are many variations of CPM/PERT which have been useful in planning costs, scheduling manpower and
machine time. CPM/PERT can answer the following important questions:
How long will the entire project take to be completed? What are the risks involved?
Which are the critical activities or tasks in the project which could delay the entire project if they were not completed
on time?
Is the project on schedule, behind schedule or ahead of schedule?
If the project has to be finished earlier than planned, what is the best way to do this at the least cost?

1.3 The Framework for PERT and CPM

Essentially, there are six steps which are common to both the techniques. The procedure is listed below:

I. Define the Project and all of it’s significant activities or tasks. The Project (made up of several tasks)

should have only a single start activity and a single finish activity.

II. Develop the relationships among the activities. Decide which activities must precede and which must

follow others.

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 III. Draw the "Network" connecting all the activities. Each Activity should have unique event numbers.

Dummy arrows are used where required to avoid giving the same numbering to two activities.

IV. Assign time and/or cost estimates to each activity

V. Compute the longest time path through the network. This is called the critical path.

VI. Use the Network to help plan, schedule, monitor and control the project.

The Key Concept used by CPM/PERT is that a small set of activities, which make up the longest path through the
activity network control the entire project. If these "critical" activities could be identified and assigned to responsible
persons, management resources could be optimally used by concentrating on the few activities which determine the
fate of the entire project.
Non-critical activities can be replanned, rescheduled and resources for them can be reallocated flexibly, without
affecting the whole project.
Five useful questions to ask when preparing an activity network are:

 Is this a Start Activity?

 Is this a Finish Activity?
 What Activity Precedes this?
 What Activity Follows this?
 What Activity is Concurrent with this?

Some activities are serially linked. The second activity can begin only after the first activity is completed. In certain
cases, the activities are concurrent, because they are independent of each other and can start simultaneously. This is
especially the case in organisations which have supervisory resources so that work can be delegated to various
departments which will be responsible for the activities and their completion as planned.
When work is delegated like this, the need for constant feedback and co-ordination becomes an important senior
management pre-occupation.

1.4 Drawing the CPM/PERT Network

Each activity (or sub-project) in a PERT/CPM Network is represented by an arrow symbol. Each activity is preceded
and succeeded by an event, represented as a circle and numbered.

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At Event 3, we have to evaluate two predecessor activities – Activity 1-3 and Activity 2-3, both of which are
predecessor activities. Activity 1-3 gives us an Earliest Start of 3 weeks at Event 3. However, Activity 2-3 also has to
be completed before Event 3 can begin. Along this route, the Earliest Start would be 4+0=4. The rule is to take the
longer (bigger) of the two Earliest Starts. So the Earliest Start at event 3 is 4.
Similarly, at Event 4, we find we have to evaluate two predecessor activities – Activity 2-4 and Activity 3-4. Along
Activity 2-4, the Earliest Start at Event 4 would be 10 wks, but along Activity 3-4, the Earliest Start at Event 4
would be 11 wks. Since 11 wks is larger than 10 wks, we select it as the Earliest Start at Event 4.
We have now found the longest path through the network. It will take 11 weeks along activities 1-2, 2-3 and 3-
4. This is the Critical Path.

1.5.3 The Backward Pass – Latest Finish Time Rule

To make the Backward Pass, we begin at the sink or the final event and work backwards to the first event.

At Event 3 there is only one activity, Activity 3-4 in the backward pass, and we find that the value is 11-7 = 4 weeks.
However at Event 2 we have to evaluate 2 activities, 2-3 and 2-4. We find that the backward pass through 2-4 gives
us a value of 11-6 = 5 while 2-3 gives us 4-0 = 4. We take the smaller
value of 4 on the backward pass.

1.5.4 Tabulation & Analysis of Activities

We are now ready to tabulate the various events and calculate the Earliest and Latest Start and Finish times. We are
also now ready to compute the SLACK or TOTAL FLOAT, which is defined as the difference between the Latest
Start and Earliest Start.

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  The Earliest Start is the value in the rectangle near the tail of each activity

 The Earliest Finish is = Earliest Start + Duration

 The Latest Finish is the value in the diamond at the head of each activity

 The Latest Start is = Latest Finish – Duration

Early Start, Early Finish and Late Start, Late Finish

Early start and Early finish

Indicates the earliest time an activity on a network path can start and earliest it can finish. If you decide to start an
activity on its early start (assuming previous activities on that network path are completed on their early finishes),
that activity can finish on its early finish (if it does not slip). And when the last activity on a network path is
completed by its early finish, you have all the resources of those activities at your disposal to deploy on other high
risk activities.

Calculating Early start and finish (take a FORWARD pass through network path)

Remember!: Always start with the critical path and then go with paths with descending order of their total duration.

Step 1: Early start of first activity on critical path is always 1. Write it at the top left corner of that activity box (see
the image below).

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Step 2: Add its activity duration to this early start number and reduce it by one. Write the resulting number on the
top right corner of activity box.
Step 3: Take the subsequent number of this early finish and write as early start for next activity. Continue this till
you reach the end of critical path.
Step 4: Select the network path with second highest total duration, and calculate early starts and finishes. If you find
an activity with early start and finish already written do not overwrite them. Do the same for remaining network
paths.
Note: If you find two activities converging on a single activity (say, activity-G), it indicates that the activity-G will
start only AFTER converging activities finish. So, you will take the largest value amongst the early finish of these
two activities and write subsequent number as early start of the activity-G.

Why add duration to early start and then reduce by one, to get early finish? Because the duration of an activity
includes both start and finish days (or any other unit of measurement you use). So, if first activity duration is 5 days,
and early start is 1 then early finish is 1+6-1 = 6. That is 6 days including the start and finish days.

Figure 6: Early start and finish

As you noticed, early start number is written at the top left corner of activity box, andearly finish on the top
right corner. The critical path with early start and early finish days will look like this –

Figure 7: Early start and early finish for critical path

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Late start and Late finish

Indicates the latest time an activity on a network path can start and latest it can finish. Knowing how late the last
activity on the network path can start and still finish within the time to not impact critical path, will let you decide
how much of flexibility you want to exercise on its schedule. However, once the last activity on the network path
starts on its late start day it should not slip, else it will impact project completion date.

Calculating Late start and finish (take BACKWARD pass through network path)

Remember!: Start with the critical path, beginning at the last activity’s late finish.

Step 1: Late finish of last activity on the critical path is same as its early finish. Write this number at the bottom
right corner.
Step 2: Calculate late start of this activity as the late finish minus activity duration plus 1. This calculation has the
same reason – start and finish are both included in the duration. Write this number at the bottom left corner.
Step 3: Write this late start of the activity minus 1, as the late finish of previous activity. Continue this way all way
till you reach the late start of first activity on the critical path.
Step 4: Select the network path with second highest total duration, and write late starts and finishes beginning at the
last activity of that path. Do the same for remaining network paths.
Notes:
 If you find two activities converging on a single activity (say, activity-C), take the smallest value amongst the
late start of these activities and write previous number as late finish of the activity-C.
 If you find an activity with late start and finish already written do not overwrite them.

Figure 8: Late start and Late finish

Late start number is written at the bottom left corner of activity box, and late finish on the bottom right
corner. The critical path of our example with late starts and late finishes will look like this –

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 Figure 9: Late start, finish for the critical path

Let us go back to our example and calculate early/late start/finish for the entire schedule network diagram.

Figure 10: Early start, finish and Late start, finish for the entire schedule network diagram

The diagram below illustrates the kinds of situation we can represent in network diagrams.

In the last situation shown above we have a dotted arc. This dotted arc is a dummy activity. Dummy activities often
have a zero completion time and are used to represent precedence relationships that cannot be easily (if at all)
represented using the actual activities involved in the project. By convention dummies are always shown as
dotted arcs in network diagrams.

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There are two important types of Float or Slack. These are Total Float and Free Float.

TOTAL FLOAT is the spare time available when all preceding activities occur at the earliest possible times and all
succeeding activities occur at the latest possible times.

 Total Float = Latest Start – Earliest Start

Activities with zero Total float are on the Critical Path

FREE FLOAT is the spare time available when all preceding activities occur at the earliest possible times and all
succeeding activities occur at the earliest possible times.
When an activity has zero Total float, Free float will also be zero.
There are various other types of float (Independent, Early Free, Early Interfering, Late Free, Late Interfering), and
float can also be negative. We shall not go into these situations at present for the sake of simplicity and be concerned
only with Total Float for the time being.
Having computed the various parameters of each activity, we are now ready to go into the scheduling phase, using a
type of bar chart known as the Gantt Chart.
There are various other types of float (Independent, Early Free, Early Interfering, Late Free, Late Interfering), and
float can also be negative. We shall not go into these situations at present for the sake of simplicity and be concerned
only with Total Float for the time being. Having computed the various parameters of each activity, we are now ready
to go into the scheduling phase, using a type of bar chart known as the Gantt Chart.

Similarities Between PERT and CPM

Like PERT, CPM requires project managers to figure out which tasks need to be completed in what order and then
determine how these tasks can be coordinated to minimize the amount of time to completion. Also, CPM adds a
time/cost assessment, unlike PERT, which permits more flexible estimates of time. The critical path in CPM is the

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single most crucial aspect of the process, and accurate timing combined with cost control makes this technique one
of the most effective project management tools available in a variety of sectors.

This should not be confused with CPM in digital marketing, which stands for “cost per mille” (mille is Italian for
one-thousand). Specifically, this instance refers to the cost per 1000 webpage advertisement
impressions. Impressions refer to the ads shown on the webpage, whether or not a user clicks on them.

Comparison Chart

BASIS FOR
PERT CPM
COMPARISON

Meaning PERT is a project management technique, CPM is a statistical technique of project

used to manage uncertain activities of a management that manages well defined
project. activities of a project.

What is it? A technique of planning and control of A method to control cost and time.
time.

Orientation Event-oriented Activity-oriented

Evolution Evolved as Research & Development Evolved as Construction project

project

Model Probabilistic Model Deterministic Model

Focuses on Time Time-cost trade-off

Estimates Three time estimates One time estimate

Appropriate for High precision time estimate Reasonable time estimate

Management of Unpredictable Activities Predictable activities

Nature of jobs Non-repetitive nature Repetitive nature

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 BASIS FOR
PERT CPM
COMPARISON

Critical and Non- No differentiation Differentiated

critical activities

Suitable for Research and Development Project Non-research projects like civil construction,
ship building etc.

Crashing concept Not Applicable Applicable

Program evaluation and review technique

The program (or project) evaluation and review technique (PERT) is a statistical tool used in project
management, which was designed to analyze and represent the tasks involved in completing a given project. First
developed by the United States Navy in the 1950s, it is commonly used in conjunction with the critical path
method (CPM).

Overview

PERT is a method of analyzing the tasks involved in completing a given project, especially the time needed to
complete each task, and to identify the minimum time needed to complete the total project. It incorporates
uncertainty by making it possible to schedule a project while not knowing precisely the details and durations of all
the activities. It is more of an event-oriented technique rather than start- and completion-oriented, and is used more
in projects where time is the major factor rather than cost. It is applied to very large-scale, one-time, complex, non-
routine infrastructure and Research and Development projects.

Program Evaluation Review Technique (PERT) offers a management tool, which relies "on arrow and node
diagrams of activities and events: arrows represent the activities or work necessary to reach the events or nodes that
indicate each completed phase of the total project."

PERT and CPM are complementary tools, because "CPM employs one time estimate and one cost estimate for each
activity; PERT may utilize three time estimates (optimistic, expected, and pessimistic) and no costs for each activity.
Although these are distinct differences, the term PERT is applied increasingly to all critical path scheduling."

Hiistory

"PERT" was developed primarily to simplify the planning and scheduling of large and complex projects. It was
developed for the U.S. Navy Special Projects Office in 1957 to support the U.S. Navy's Polaris nuclear submarine
project. It found applications all over industry. An early example was it was used for the 1968 Winter
Olympics in Grenoble which applied PERT from 1965 until the opening of the 1968 Games. This project model was
the first of its kind, a revival for scientific management, founded by Frederick Taylor (Taylorism) and later refined
by Henry Ford (Fordism). DuPont's critical path method was invented at roughly the same time as PERT.

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 Initially PERT stood for Program Evaluation Research Task, but by 1959 was already renamed. It had been made
public in 1958 in two publications of the U.S. Department of the Navy, entitled Program Evaluation Research Task,
Summary Report, Phase 1.and Phase 2. In a 1959 article in The American Statistician the main Willard Fazar, Head
of the Program Evaluation Branch, Special Projects Office, U.S. Navy, gave a detailed description of the main
concepts of the PERT.

Management tools
PERT supplies a number of tools for management with determination of concepts, such as:

 float or slack is a measure of the excess time and resources available to complete a task. It is the amount of time that
a project task can be delayed without causing a delay in any subsequent tasks (free float) or the whole project (total
float). Positive slack would indicate ahead of schedule; negative slack would indicate behind schedule; and zero
slack would indicate on schedule.
 critical path: the longest possible continuous pathway taken from the initial event to the terminal event. It
determines the total calendar time required for the project; and, therefore, any time delays along the critical path will
delay the reaching of the terminal event by at least the same amount.
 critical activity: An activity that has total float equal to zero. An activity with zero float is not necessarily on the
critical path since its path may not be the longest.
 Lead time: the time by which a predecessor event must be completed in order to allow sufficient time for the
activities that must elapse before a specific PERT event reaches completion.
 lag time: the earliest time by which a successor event can follow a specific PERT event.
 fast tracking: performing more critical activities in parallel
 crashing critical path: Shortening duration of critical activities

Implementation

The first step to scheduling the project is to determine the tasks that the project requires and the order in which they
must be completed. The order may be easy to record for some tasks e.g. When building a house, the land must be
graded before the foundation can be laid) while difficult for others (there are two areas that need to be graded, but
there are only enough bulldozers to do one). Additionally, the time estimates usually reflect the normal, non-rushed
time. Many times, the time required to execute the task can be reduced for an additional cost or a reduction in the
quality.

Advantages
 PERT chart explicitly defines and makes visible dependencies (precedence relationships) between the work
breakdown structure (commonly WBS) elements.
 PERT facilitates identification of the critical path and makes this visible.
 PERT facilitates identification of early start, late start, and slack for each activity.
 PERT provides for potentially reduced project duration due to better understanding of dependencies leading to
improved overlapping of activities and tasks where feasible.
 The large amount of project data can be organized and presented in diagram for use in decision making.
 PERT can provide a probability of completing before a given time.

Disadvantages
 There can be potentially hundreds or thousands of activities and individual dependency relationships.
 PERT is not easily scalable for smaller projects.
 The network charts tend to be large and unwieldy, requiring several pages to print and requiring specially-sized
paper.

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 The lack of a timeframe on most PERT/CPM charts makes it harder to show status, although colours can help, e.g.,
specific colour for completed nodes.

Critical path method

The critical path method (CPM), or critical path analysis(CPA), is an algorithm for scheduling a set of project
activities. It is commonly used in conjunction with the program evaluation and review technique (PERT). A critical
path is determined by identifying the longest stretch of dependent activities and measuring the time required to
complete them from start to finish.

The critical path method (CPM) is a project modeling technique developed in the late 1950s by Morgan R. Walker
of DuPont and James E. Kelley Jr. of Remington Rand. Kelley and Walker related their memories of the
development of CPM in 1989. Kelley attributed the term "critical path" to the developers of the Program Evaluation
and Review Technique which was developed at about the same time by Booz Allen Hamilton and the U.S.
Navy. The precursors of what came to be known as Critical Path were developed and put into practice by Pont
between 1940 and 1943 and contributed to the success of the Manhattan Project.
Critical Path Analysis is commonly used with all forms of projects, including construction, aerospace and defense,
software development, research projects, product development, engineering, and plant maintenance, among others.
Any project with interdependent activities can apply this method of mathematical analysis. The first time CPM was
used for major skyscraper development was in 1966 while constructing the former World Trade Center Twin
Towers in New York City. Although the original CPM program and approach is no longer used, the term is
generally applied to any approach used to analyze a project network logic diagram.

Crash duration
Crash duration is a term referring to the shortest possible time for which an activity can be scheduled. It can be
achieved by shifting more resources towards the completion of that activity, resulting in decreased time spent and
often a reduced quality of work, as the premium is set on speed. Crash duration is typically modeled as a linear
relationship between cost and activity duration; however, in many cases a convex function or a step function is more
applicable

What are the advantages in a CPM Implemention?

1. The CPM makes it easier for the project managers to build a team and create human network for efficient
handling of a multi-tasked project.

2. The Critical Path Method binds the entire team together and motivates the human resources in timely
completion of the tasks in a project.

3. The CPM takes into consideration the requirements well in advance to complete a project in the most
efficient way possible.

4. With help of the Critical Path Method the project managers can determine the duration and estimate exact
time and cost of the project. It helps to monitor human resources, and the direct and indirect costs
associated with the project.

5. The CPM assists the project managers in planning schedules, monitoring tasks, and helps control the
project expenses.

6. The Critical Path Method also makes it convenient for the project managers to calculate the time required
to complete the tasks of the project. That helps them to predict completion date of every phase, anticipate
problems along the way, if any, and react accordingly.

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 7. Charting in a CPM makes it easier to evaluate parallel activities, handle delays and judge the outcome of a
task.

8. It enables the managers to minimize the project length by monitoring the critical path.

9. The Critical Path Method chart clearly identifies critical path/s of the project, which assists the managers in
decision making to address the issue quickly. It also enables the project head to determine if the task is on
schedule or needs boost to accelerate the process.

10. The charting in a CPM also enables the managers to determine start time, end time, slack time and float
time associated with each activity of the project.

What are the disadvantages in a CPM Implementation?

1. In a big project, a CPM can become extremely complicated and difficult to fathom for the new recruits to
the project team.

2. If the project is far too bulky and lengthy, the Critical Path Method requires software to monitor the plan.

3. CPM can become ineffective and difficult to manage if it is not well-defined and stable.

4. It cannot effectively handle sudden changes in the implementation of the plan on ground. It is very difficult
to redraw the entire CPM chart if the plan of the project suddenly changes midway.

5. The Critical Path Method cannot form and control the schedules of the persons involved in the project.

6. The allocation of resources cannot be properly monitored.

7. The critical path of the CPM of a big project is not always clear. The project managers have to spend a lot
of time to calculate it carefully.

8. The Critical Path Method takes longer to identity and to monitor the critical path when the project is of big
dimension.

9. Using CPM, identifying and determining a critical path is difficult when there are many other similar
duration paths in the project.

10. At times, to design a CPM is time consuming. It is also difficult to estimate the activity completion time in
a multidimensional project.

ACTIVITY OUTPUT

Activity, in project management, is defined as the amount of work performed that converts input to appropriate
outputs. Define activities refer to the process of identifying as well as documenting actions that need to be
implemented and performed in order to produce the deliverables of the project. The benefits of this process are: it
breaks down big work packages into smaller activities so that the project manager can estimate, schedule, execute,
monitor and control the project work.

The work packages are very crucial to define activities. They are nothing more than the work breakdown structure
items that go into the scope baseline. This is the most important input in this particular process. Aside from work
packages, it is also crucial for the project manager to use the schedule management plan because they contain
guidelines when it comes to defining activities.

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These inputs will be analyzed using tools used in the project management information system such as scheduling,
change control, planning and budget cost management. Using this tool, project managers will be able to come up
with great plans to define activities for the project.

When defining activities, it is crucial not to break down the work package into very small and specific activities as it
can lead to increased management overhead that will result to more dependencies within team members. It is also
important to get the rest of the team members to get involved with the decomposition process because they are
highly familiar with the tasks so they know where and how exactly to break them down. Lastly, defining activities
is a process that requires adequate information so if you do not have enough information, do not even attempt to
break the work breakdown structure as this will create confusion in the final output.

SUMMARY AND CONCLUSION

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PERT and CPM are the two network-based project management techniques, which exhibit the
flow and sequence of the activities and events. Program (Project) Management and Review
Technique (PERT) is appropriate for the projects where the time needed to complete different
activities are not known. On the other hand, the Critical Path Method or CPM is apt for the
projects which are recurring in nature.
Developed in the 1950s, PERT is aimed to reduce the time and cost of the project. The world we
live in today is experiencing tremendous growth and rapid development; organizations are
experiencing more competition now more than an ever and a project manager who wants to stand
out would have to utilize all resources at his disposal to deliver quality results at a faster rate. To
do that he will need to be at the top of his game to efficiently coordinate the activities that will
result in the successful execution of his project. He will need to be up to date on the tools and
techniques that will aid in his delivery and one of such methods is PERT.
Whereas, CPM, its process differentiates the critical and non-critical activities to reduce the time
and avoid the queue generation in the process. The reason for the identification of critical
activities is that, if any activity is delayed, it will cause the whole process to suffer. That is why it
is named as Critical Path Method. The primary difference between PERT and CPM is that the
PERT gives the extreme importance of time, i.e. if the time is minimized, consequently the cost
will also be reduced.
The PERT technique is always used alongside the Critical Path Method when estimating project
duration and calculating variances. For computing a wider range of complex activities,
computers are employed for the analysis of project networks.

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REFERENCES

http://people.brunel.ac.uk/~mastjjb/jeb/or/netaoa.html

https://www.pmexamsmartnotes.com/how-to-calculate-critical-path-float-and-early-and-late-starts-and-finishes/3/

https://www.cpmscheduling.com/critical-path-method/advantages-and-disadvantages-in-the-implementation-of-
cpm/

https://keydifferences.com/difference-between-pert-and-cpm.html

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