Project Scheduling &

Project Management
Techniques

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 PROJECT MANAGEMENT
TECHNIQUES: PERT AND CPM
The Framework of PERT and CPM
Network Diagrams and Approaches
Activity on Node Example
Determining the Project Schedule
Forward Pass
Backward Pass
Calculating Slack Time and
Identifying the Critical Path(s)
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Outline - Continued
Variability in Activity Times
Three Time Estimates in PERT
Probability of Project Completion

Cost-Time Tradeoffs and Project

Crashing
A Critique of PERT and CPM

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Learning Objectives
When you complete this chapter,
you should be able to :
Identify or Define:
Critical path
AOA and AON Networks
Forward and Backward Passes
Variability in Activity Times

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Learning Objectives Continued

When you complete this chapter,

you should be able to :
Describe or Explain:
The role of the project manager
Program evaluation and review
technique (PERT)
Critical path method (CPM)
Crashing a project
The Use of MS Project
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Project Scheduling

1995 Corel Corp.

PERT

Identifying
precedence
relationships
Sequencing
activities
Determining
activity times &
costs
Estimating
material & worker
requirements
Determining
3-6

J
nth
F
Mo
M
A
M

v ity
Acti
ign
Des
d
Buil
t
Tes

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Purposes of Project
Scheduling

Shows the relationship of each

activity to others and to the
whole project.
Identifies the precedence
relationships among activities.
Encourages the setting of
realistic time and cost
estimates for each activity.
Helps make better use of
people, money, and material
resources by identifying critical
bottlenecks in 3-7
the project.
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Project Management
Techniques
Gantt chart
Critical Path Method
(CPM)
Program Evaluation &
Review Technique
(PERT)

1984-1994 T/Maker Co.

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Gantt Chart
Activity

Time Period
J

Design
Build
Test

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Service Activities for A

Delta Jet During a 60
Minute Layover

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Project Control Reports

Detailed cost breakdowns for
each task
Total program labor curves
Cost distribution tables
Functional cost and hour
summaries
Raw materials and expenditure
forecasts
Variance reports
Time analysis reports
Work status reports
3-11
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PERT and CPM

Network techniques
Developed in 1950s
CPM by DuPont for chemical plants
(1957)
PERT by Booz, Allen & Hamilton
with the U.S. Navy, for Polaris
missile (1958)

Consider precedence
relationships and
interdependencies
3-12
Each uses a different estimate
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Questions Which May Be

Addressed by PERT & CPM
Is the project on schedule,
ahead of schedule, or behind
schedule?
Is the project over or under cost
budget?
Are there enough resources
available to finish the project
on time?
If the project must be finished
3-13
in less than the scheduled

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The Six Steps Common to

PERT & CPM
Define the project and prepare the
work breakdown structure,
Develop relationships among the
activities. (Decide which activities
must precede and which must follow
others.)
Draw the network connecting all of
the activities
Assign time and/or cost estimates to
each activity
Compute the longest time path
through the network. This is called
the critical path
3-14
Use the network to help plan,

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A Comparison of AON
and AOA Network
Conventions

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Milwaukee General
Hospitals Activities and
Predecessors
Activit
Description
Immediate
y
A

Predecesso
rs
-

Build internal
components
Modify roof and floor

Construct collection stack

Pour concrete and install

frame
Build high-temperature

A, B
C

burner
Install pollution control
system
Install air pollution device

D, E

Inspect and test

F, G

E
F

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AON Network for

Milwaukee General
Hospital
F
A

C
F

Star
t
B

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G

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w
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AOA Network (With

Dummy Activities) for
Milwaukee General

B
M
ro o
of dif
/ y
r floo

D
umm
y
Activi
ty

4
E
Build burner

A
co in Bu
m ter ild
po n
ne al
nt
s

C
Constru
ct stack

Pour
concrete/
Install frame

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coIn F
ntsta
ro ll
ls

Inspect/T
n
o
est
i
G lut ice
l v
o
e
lpld
l
ta tro
s
In on
c

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Critical Path Analysis

Provides activity information

Earliest (ES) & latest (LS) start

Earliest (EF) & latest (LF) finish
Slack (S): Allowable delay

Identifies critical path

Longest path in network

Shortest time project can be
completed
Any delay on critical path
activities delays project
Critical path activities have 0 slack

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Earliest Start and

Finish Steps
Begin at starting event and work
forward
ES = 0 for starting activities
ES is earliest start

EF = ES + Activity time
EF is earliest finish

ES = Maximum EF of all
predecessors for non-starting
activities
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Latest Start and Finish

Steps
Begin at ending event and work
backward
LF = Maximum EF for ending
activities
LF is latest finish; EF is earliest
finish

LS = LF - Activity time
LS is latest start

LF = Minimum LS of all
successors for3-21
non-ending
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Latest Start and Finish

Steps
Activi
ty
Nam
e

ES

EF

Earliest
Finish

Latest
Start

LS

LF

Latest
Finish

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Activi
ty
Durati
on

Earliest
Start

3-22

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Critical Path for

Milwaukee General Hospital
F
A

C
F

Star
t
B

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G

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AON Network for

Milwaukee General
HospitalIncludes Critical Path
A
0 H2
0 A2
2
Slack
0
0
H
Star =0
0 t 0
0
B
S
0 B3
H
tart
4
1
3
Slack=1
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C
2 H4
2 C4
2
Slack
=0

FF
4 H7
13
1
3
0
E
Slack=6 13H 15
4 H
8
F
H
8
4
13 15
4
2
Slack=0 G
D
Slack=0
3 D7
8 G 13
H
H
8
13
4
8
4
5
Slack=1
Slack=0
3-24

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Gantt Chart
Earliest Start and
Finish

Milwaukee General Hospital

1 2 3 4 5 6 7 8 9 10
1112 13 1415 16

A Build internal
components
B Modify roof and
floor
C Construct collection
stack
D Pour concrete and
install frame
E Build hightemperature burner
F Install pollution
control system
G Install
air pollution
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Gantt Chart
Latest Start and Finish
Milwaukee General Hospital
1 2 3 4 5 6 7 8 9 10
1112 13 1415 16

A Build internal
components
B Modify roof and
floor
C Construct collection
stack
D Pour concrete and
install frame
E Build hightemperature burner
F Install pollution
control system
G Install
air pollution
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Gantt Chart
Latest Start and Finish
Build House Project
Activity

111
123456789012

1-2 Fdn & frame

1-3 Buy shrubs
2-3 Roof
2-4 Interior work
3-4 Landscape
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PERT Activity Times

3 time estimates
Optimistic times (a)
Most-likely time (m)
Pessimistic time (b)

Follow beta distribution

Expected time: t = (a + 4m +
b)/6
Variance of times: v = (b a)2/6
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Project Times
Used to obtain
probability of
project
Sum of critical path
completion!

Expected project
time (T)
activity times, t

Project variance (V)

Sum of critical path
activity variances, v

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PERT Probability
Example
Youre a project
planner for General
Dynamics. A
submarine project
has an expected
completion time of
40 weeks, with a
standard deviation of
5 weeks. What is the
probability of
finishing the sub in
50 weeks or less?
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1995
Corel Corp.

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Converting to
Standardized Variable
X - T 50 - 40
=
= 20
Z=
.
s
5
Normal
Distribution

Standardized
Normal Distribution

sZ= 1

s= 5

mz= 0 2.0

T= 40 50 X
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Obtaining the
Probability

Standardized Normal
Probability Table (Portion)
Z .00

.01

.02

s Z= 1

.50399
.50798
0.0.50000
:

.97784
.97831
2.0.97725

.9772
mz= 5
0 2.0

.98257
.98300
2.1.98214

Probabilities in body
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Variability of
Completion Time for
Noncritical Paths
Variability of times for activities
on noncritical paths must be
considered when finding the
probability of finishing in a
specified time.
Variation in noncritical activity
may cause change in critical
path.
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Factors to Consider
when Crashing
The amount by which an
activity is crashed is, in fact,
permissible.
Taken together, the shortened
activity durations will enable
one to finish the project by the
due date.
The total cost of crashing is as
small as possible.
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Steps in Project
Crashing
Compute the crash cost per time period.
For crash costs assumed linear over time:
Crash cost per period =

(Crash cost Normal cost

(Normal time Crash time)

Using current activity times, find the

critical path
If there is only one critical path, then
select the activity on this critical path that
(a) can still be crashed, and (b) has the
smallest crash cost per period. Note that
a single activity may be common to more
than one critical path
3-35

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Crash and Normal

Times and Costs for
Activity B

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Cost-Time Curves Used

in Crashing Analysis

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Advantages of
PERT/CPM
Especially useful when scheduling

and controlling large projects.

Straightforward concept and not
mathematically complex.
Graphical networks aid perception of
relationships among project
activities.
Critical path & slack time analyses
help pinpoint activities that need to
be closely watched.
Project documentation and graphics
point out who is responsible for
various activities.
Applicable to a wide
variety of
3-38
projects.

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Limitations of
PERT/CPM
Assumes clearly defined,
independent, & stable activities
Specified precedence
relationships
Activity times (PERT) follow
beta distribution
Subjective time estimates
Over-emphasis on critical path
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