PERT and

CPM
ENGR. KRISTINE JOY A. CAALAM, RMP
Instructor
 What is PERT and what is CPM?
PERT is a Program Evaluation and Review Technique.

CPM is the Critical Path Method.

PERT and CPM were developed independently in the later part of 1950's. These
two are network techniques, used for planning and coordinating large scale projects.
 PERT
The use of PERT began in 1958 through the joint efforts of the Lockheed
Aircraft, the U.S. Navy Special Project Office and the consulting firm of Booz,
Allen & Hamilton in the efforts of the U.S. government to speed up the Polaris
Missile project.
The U.S. government's apprehension that the Soviet Union, might gained nuclear
superiority over the U.S., early completion of the project was given top priority. A
Special research team was directed to formulate a new approach considering that
the management concepts and methods at that time were not adequate. The
concept was formulated by the research team and is then called Program
Evaluation and Review Technique, which is simply called PERT.
 CPM

In 1956, prior to the development of PERT, the Critical Path Method which is
simply called CPM was developed by J.E. Kelly of the Remington Rand Corp.
and M.R. Walker of Du Pont in an effort by commercial industry to make an
advanced scheduling and cost control methods. By April 1958, CPM in application
was demonstrated in a real success.
 PERT and CPM
CPM was designed as a tool for planning, scheduling, and control of construction
work. Its emphasis was on the work or activities to be managed. The network
diagram defined and focused attention on the job to be accomplished. The
schedule derives the earliest and the latest times for their start and finish.
PERT was developed as a result of looking for an improved method of planning
and evaluating progress of a large scale research and development program. It was
designed to provide the management a periodic reporting of current status and an
outlook for the future on meeting approved plans and schedules. It answers the
questions such as: "Is this a feasible schedule? And what are the probabilities of
making it?”
PERT and CPM
PERT and CPM
 PERT and CPM

However, from a conceptual analysis, most of these differences were relatively

minor. For practical purposes, the two techniques are the same. Thus,
comments and procedures described will apply to both PERT and CPM project
analysis.
 PERT and CPM

PERT/CPM is a control tool for defining the parts of construction job and then putting
them together in a network form.
It serves as an aid to the construction manager but it does not make decision for him nor
does it guarantee good management. PERT/ CPM only serves the project manager to see the
whole picture of the entire job. It encourages periodic re-evaluation and providing an
accurate measure of progress.
Thus, a person in charge of each work and the project manager know what is supposed to
happen and when it is supposed to happen.
 PERT/CPM PROJECT REQUIREMENTS
● Presidential Decree (PD) 1594

Presidential Decree (PD) 1594, Prescribing Policies, Guidelines, Rules and Regulations for Government infrastructure contracts provides
that: “The programs of work shall include among other things, estimates of the work items, costs, and a PERT/CPM network of the project
activities.

● Memorandum Circular No. 153 (January 27, 1968, President Ferdinand E. Marcos)

● Presidential Order (June 19, 1968, the Executive Committee for Infrastructure Program)
● Section 6 of R.A 5979 requires the application of PERT/CPM technique to all projects with an estimated cost of
P100,000.00 or more.
 PERT/CPM PROJECT REQUIREMENTS
With the use Of PERT/CPM, the project manager can easily obtain the following information:
1. The graphical display of project activities
2. An estimate of how long will the project last
3. Determine which activities are the most critical to timely project completion.
4. Determine how long any activity can be delayed without lengthening the project.
 THREE PHASES OF PERT/CPM

The three phases of PERT/CPM are:

1. Planning

2. Scheduling

3. Control-Monitor
 PLANNING
In any project construction undertakings, planning is the most important consideration
which includes:
1. Gathering of all the necessary input data to make the PERT/CPM works.
2. Planning phase is the main work of the contractor for being familiar and knowledgeable
of his costing methods of doing business.
3. The contractor can seek assistance for the accomplishment of his work particularly the
gathering of data, but his basic responsibility on this matter cannot be delegated to any
outsider group.
4. The contractor has the complete perception, experiences, resources, and interest in
getting the project done in the best possible time and cost.
5. The planning stages give the contractor a "Dry Run" on the construction of the project.
6. If the contractor wants an effective approach and use of the construction management,
he must do it himself.
7. By performing the work personally, one obtains intimate first hand knowledge of the
job and gain insight and details of anticipated problems.
 PLANNING

In the Planning Phase, there are five inputs that can be obtained:

1. A network diagram defining the activities in the project.

2. The duration of activities
3. Cost estimates of the activities for monitoring cost, cash flow
requirements
4. Resource estimates
5. Trade indicators (responsibility) for activity grouping.
 SCHEDULING
In PERT/CPM, Scheduling is defined as the process of translating the arrow
diagram into time table of calendar days. This is done by the day date table
converting working days into calendar days which permits the inclusion of
weekends, holidays, weather and other time lost.

The PERT/CPM diagram should be updated periodically to account for:

1. Time discrepancies
2. Deliveries
3. Weather
4. Change orders
5. Unexpected events or conditions.
6. Updating of the diagram is based on the number of days the project is out
of schedule.
 SCHEDULING
From the Schedule Phase, there are four output that can be obtained:
1. The schedule of activities in the network showing the following:
a. The Critical Activities
b. The Earliest Start date for each activity
c. The Earliest Finish date for each activity
d. The Latest Start date for each activity
e. The Latest Finish date for each activity
f. The Float which refers to the amount of extra time available for an activity.
2. A Bar Chart or a Time Scaled Network (arrow diagram network for the project).
3. A Resource Analysis showing the number and kind of resources, man power,
equipment and others that are re quired for each day of the project.
4. A Cash Requirement prediction indicating how much cash to be disbursed for the job
and the amount of money that will be collected as a result of work accomplishment.
 CONTROLING AND MONITORING
In PERT/CPM, Scheduling is defined as the process of translating the arrow
diagram into time table of calendar days. This is done by the day date table
converting working days into calendar days which permits the inclusion of
weekends, holidays, weather and other time lost.

The PERT/CPM diagram should be updated periodically to account for:

1. Time discrepancies
2. Deliveries
3. Weather
4. Change orders
5. Unexpected events or conditions.
6. Updating of the diagram is based on the number of days the project is out
of schedule.
 CONTROLING AND MONITORING
The Control Monitor Phase uses actual data which includes:
1. Additions to the project - This refers to the new activities.
2. Deletion from the project
3. Changes as to duration, description, trade indicators, cost estimates or resource
estimates.
4. Actual starting dates
5. Actual finishing dates.

The Output Phase consists of the following:

1. Time status report
2. Revised schedules
3. Revised Bar Charts/ Arrow Diagram
4. Revised resource analysis
5. Revised cash flow predictions
6. Cost status reports
 CONSTRUCTION FAILURE

There are three major reasons for construction failure:

1. Unbalanced organization due to lack of planning and scheduling.

2. Lack of financial planning
3. Poor cost control