PROJECT

MANAGEMENT
OM202
 Project Management

LESSON 12 LESSON 13
NETWORK SCHEDULING TECHNIQUE PROJECT GRAPHICS
Management is continually seeking new and better control
techniques to cope with the complexities, masses of data,
and tight deadlines that are characteristic of highly
competitive industries. Managers also want better methods
for presenting technical and cost data to customers.
COMMON SCHEDULING TECHNIQUES
◦● Gantt or bar charts
◦● Milestone charts
◦● Line of balance
◦● Networks
◦ ● Program Evaluation and Review Technique (PERT)
◦ ● Arrow Diagram Method (ADM) [Sometimes called the Critical Path Method (CPM)]
◦ ● Precedence Diagram Method (PDM)
◦ ● Graphical Evaluation and Review Technique (GERT)
Advantages of Network Scheduling
◦ ● They form the basis for all planning and predicting and help management
decide how to use its resources to achieve time and cost goals.
◦ ● They provide visibility and enable management to control “one-of-a-kind”
programs.
◦ ● They help management evaluate alternatives by answering such questions as
how time delays will influence project completion, where slack exists between
elements, and what elements are crucial to meet the completion date.
◦ ● They provide a basis for obtaining facts for decision-making
Advantages of Network Scheduling
◦ ● They utilize a so-called time network analysis as the basic method to
determine manpower, material, and capital requirements, as well as to provide
a means for checking progress.
◦ ● They provide the basic structure for reporting information.
◦ ● They reveal interdependencies of activities.
◦ ● They facilitate “what if” exercises.
◦ ● They identify the longest path or critical paths.
◦ ● They aid in scheduling risk analysis.
 Program Evaluation and Review
Technique (PERT) Pros and Cons
◦ PERT allows extensive planning.
◦ PERT allows one to determine the probability of meeting deadlines by development of alternative plan.
◦ PERT creates the ability to evaluate the effects of the changes in program.
◦ PERT allows large amount of sophisticated date to be presented in a well organized diagram from which
contractors and customers can make joint decisions.

◦ PERT is complex and at times adds up to implementation problems.

◦ PERT requires more data for more organized reporting system.
◦ Since it need more data, it is expensive to maintain on most large and complex programs.
The results of PERT
◦● Cut project costs and time
◦● Coordinate and expedite planning
◦● Eliminate idle time
◦● Provide better scheduling and control of subcontractor activities
◦● Develop better troubleshooting procedures
◦● Cut the time required for routine decisions, but allow more time
for decision-making
Criticisms to PERT

◦● Time and labor intensive

◦● Decision-making ability reduced
◦● Lacks functional ownership in estimates
◦● Lacks historical data for time–cost estimates
◦● Assumes unlimited resources
◦● Requires too much detail
NETWORK FUNDAMENTALS

The major discrepancy with Gantt, milestone, or bubble

charts is the inability to show the interdependencies between
events and activities. These interdependencies must be
identified so that a master plan can be developed that
provides an up-to-date picture of operations at all times
Interdependencies are shown through the construction of
networks. Network analysis can provide valuable
information for planning, integration of plans, time studies,
scheduling, and resource management. The primary purpose
of network planning is to eliminate the need for crisis
management by providing a pictorial representation of the
total program.
Management information obtained in
Network Scheduling
● Interdependencies of activities
● Project completion time
● Impact of late starts
● Impact of early starts
● Trade-offs between resources and time
● “What if” exercises
● Cost of a crash program
● Slippages in planning/performance
● Evaluation of performance
Networks are composed of events and activities. An event is defined as the
starting or ending point for a group of activities, and an activity is the work
required to proceed from one event or point in time to another.
The numbers in the circles signify the specific events or accomplishments. The number
over the arrow specifies the time needed (hours, days, months), to go from event 6 to
event 3. The events need not be numbered in any specific order. However, event 6 must
take place before event 3 can be completed (or begun).
In Figure A, event 26 must take place prior to events 7, 18, and 31. In
Figure B, the opposite holds true, and events 7, 18, and 31 must take place
prior to event 26. Figure 12–2B is similar to “and gates” used in logic
diagrams.3
PERT is basically a management planning and control tool. It can
be considered as a road map for a particular program or project in
which all of the major elements (events) have been completely
identified, together with their corresponding interrelations. PERT
charts are often constructed from back to front because, for many
projects, the end date is fixed and the contractor has front-end
flexibility
One of the purposes of constructing the PERT chart is to determine
how much time is needed to complete the project. PERT, therefore,
uses time as a common denominator to analyze those elements that
directly influence the success of the project, namely, time, cost, and
performance. The construction of the network requires two inputs.
First, do events represent the start or the completion of an activity?
Event completions are generally preferred
Defining the Sequences of the event
Defining the Sequences of the event
Sequencing the Events
PERT Answers these Essential Questions

◦● What job immediately precedes this job?

◦● What job immediately follows this job?
◦● What jobs can be run concurrently?
Two (2) things PERT tells the Management

◦● Because there is no slack time in any of the events on this

path, any slippage will cause a corresponding slippage in the
end date of the program unless this slippage can be recovered
during any of the downstream events (on the critical path).
◦● Because the events on this path are the most critical for the
success of the project, management must take a hard look at
these events in order to improve the total program.
PERT Simplified Network Schedule
PERT vs CPM

The nomenclature is the same and both techniques

are often referred to as arrow diagramming methods,
or activity-on-arrow networks.
PERT vs CPM
● PERT uses three time estimates (optimistic, most likely, and pessimistic as
will be shown later) to derive an expected time. CPM uses one time estimate that
represents the normal time (i.e., better estimate accuracy with CPM).
● PERT is probabilistic in nature, based on a beta distribution for each activity
time and a normal distribution for expected time duration (see Section 12.7).
This allows us to calculate the “risk” in completing a project. CPM is based on a
single time estimate and is deterministic in nature.
● Both PERT and CPM permit the use of dummy activities in order to develop
the logic
● PERT is used for R&D projects where the risks in calculating time durations
have a high variability. CPM is used for construction projects that are resource
dependent and based on accurate time estimates.
● PERT is used on those projects, such as R&D, where percent complete is
almost impossible to determine except at completed milestones. CPM is used for
those projects, such as construction, where percent complete can be determined
with reasonable accuracy and customer billing can be accomplished based on the
percent complete.
GRAPHICAL EVALUATION AND REVIEW TECHNIQUE
(GERT)
Graphical evaluation and review techniques are similar to PERT
but have the distinct advantages of allowing for looping,
branching, and multiple project end results. With PERT one
cannot easily show that if a test fails, we may have to repeat the
test several times. With PERT, we cannot show that, based upon
the results of a test, we can select one of several different
branches to continue the project. These problems are easily
overcome using GERT
DEPENDENCIES
There are three basic types of interrelationships or dependencies:
◦ Mandatory dependencies (i.e., hard logic): These are dependencies that
cannot change, such as erecting the walls of a house before putting up the roof.
◦ Discretionary dependencies (i.e., soft logic): These are dependencies that
may be at the discretion of the project manager or may simply change from
project to project. As an example, one does not need to complete the entire bill
of materials prior to beginning procurement.
◦ External dependencies: These are dependencies that may be beyond the
control of the project manager such as having contractors sit on your critical
path.
Sometimes, it is impossible to draw network
dependencies without including dummy activities.
Dummy activities are artificial activities, represented
by a dotted line, and do not consume resources or
require time. They are added into the network simply
to complete the logic.
SLACK TIME

Since there exists only one path through the network that is
the longest, the other paths must be either equal in length to
or shorter than that path. Therefore, there must exist events
and activities that can be completed before the time when
they are actually needed. The time differential between the
scheduled completion date and the required date to meet
critical path is referred to as the slack time.
The critical path is vital for resource scheduling and allocation because the
project manager, with coordination from the functional manager, can
reschedule those events not on the critical path for accomplishment during
other time periods when maximum utilization of resources can be
achieved, provided that the critical path time is not extended. This type of
rescheduling through the use of slack times provides for a better balance of
resources throughout the company, and may possibly reduce project costs
by eliminating idle or waiting time.
◦TE = the earliest time (date) on which an event can be
expected to take place
◦TL = the latest date on which an event can take place
without extending the completion date of the project
◦Slack time = TL - TE
PERT Network with Slack Time
The calculation for slack time is performed for each event in the network, as shown in the figure, by
identifying the earliest expected date and the latest starting date. For event 1, TL & TE =0. Event 1
serves as the reference point for the network and could just as easily have been defined as a calendar
date. As before, the critical path is represented as a bold line. The events on the critical path have no
slack (i.e., TL- TE) and provide the boundaries for the noncritical path events. Since event 2 is critical,
TL= TE =3 +7 =10 for event 5. Event 6 terminates the critical path with a completion time of fifteen
weeks. The earliest time for event 3, which is not on the critical path, would be two weeks (TE =0+2
=2), assuming that it started as early as possible. The latest allowable date is obtained by subtracting the
time required to complete the activity from events 3 to 5 from the latest starting date of event 5.
Therefore, TL (for event 3) =10- 5= 5 weeks. Event 3 can now occur anywhere between weeks 2 and 5
without interfering with the scheduled completion date of the project. This same procedure can be
applied to event 4, in which case TE =6 and TL =9.
Capabilities of PERT/CPM
◦● The earliest time when an activity can start (ES)
◦● The earliest time when an activity can finish (EF)
◦● The latest time when an activity can start (LS)
◦● The latest time when an activity can finish (LF)