CPM calculation

Path

Critical Path

A connected sequence of activities leading

from the starting event to the ending event
The longest path (time); determines the
project duration

Critical Activities

All of the activities that make up the critical

path

Forward Pass
2

Earliest Start Time (ES)

earliest time an activity can start
ES = maximum EF of immediate predecessors
Earliest finish time (EF)
earliest time an activity can finish
earliest start time plus activity time
Backward
Pass
EF= ES +
t

Latest Start Time (LS)

Latest time an activity can start without delaying critical path time
LS= LF - t
Latest finish time (LF)
latest time an activity can be completed without delaying critical path time
LS = minimum LS of immediate predecessors

CPM analysis

Draw the CPM network

Analyze the paths through the network
Determine the float for each activity
Compute the activitys float
float = LS - ES = LF - EF
Float is the maximum amount of time that this activity
can be delayed in its completion before it becomes a
critical activity, i.e., delays completion of the project
Find the critical path is that the sequence of activities
and events where there is no slack i.e.. Zero slack
Longest path through a network
Find the project duration is minimum project completion
time

CPM Example:
4

CPM Network

f,f, 15
15
h,
h, 99

g,
g, 17
17

a,
a, 66

i,i, 66
b,
b, 88
d,
d, 13
13
c,
c, 55
e,
e, 99

j,j, 12
12

CPM Example
5

f,f, 15
15

ES and EF Times
a,
a, 66
0

h,
h, 99

g,
g, 17
17
i,i, 66

6
b,
b, 88
0

d,
d, 13
13

c,
c, 55
0

e,
e, 99

j,j, 12
12

CPM Example
6

ES and EF Times

f,f, 15
15
6

h,
h, 99

g,
g, 17
17

a,
a, 66
0

21

23

i,i, 66

b,
b, 88
0

d,
d, 13
13

c,
c, 55
0

21

e,
e, 99
5

14

j,j, 12
12

CPM Example
7

f,f, 15
15

ES and EF Times

h,
h, 99

g,
g, 17
17

a,
a, 66
0

21

23

21 30

i,i, 66
23

29

b,
b, 88
0

d,
d, 13
13

c,
c, 55
0

21

e,
e, 99
5

14

j,j, 12
12
21 33

Projects EF = 33

CPM Example
8

f,f, 15
15

LS and LF Times

a,
a, 66
0

21

d,
d, 13
13

21

c,
c, 55
5

e,
e, 99
5

24 33

i,i, 66

23

b,
b, 88

21 30

g,
g, 17
17

h,
h, 99

14

23

29

27

33
j,j, 12
12
21

33

21

33

CPM
CPM Example
Example
9

LS and LF Times

f,f, 15
15
6

21

h,
h, 99

18 24
a,
a, 66

21 30

g,
g, 17
17

10

10 27

b,
b, 88
0

d,
d, 13
13

c,
c, 55
0

12

24 33

i,i, 66

23

21

21

e,
e, 99
5

14

12

21

23

29

27

33
j,j, 12
12
21

33

21

33

CPM
CPM Example
Example

Float

f,f, 15
15

10

3
a,
a, 66
3

21

24
g,
g, 17
17

i,i, 66

10 27

d,
d, 13
13
0

c,
c, 55
7

12

21

21

e,
e, 99
7

23

b,
b, 88
0

h,
h, 99

14

12

21

23

29

27

33

21 30
24 33

j,j, 12
12
0

21

33

21

33

CPM Example
11

f,f, 15
15

Critical Path

h,
h, 99

g,
g, 17
17

a,
a, 66

i,i, 66
b,
b, 88
d,
d, 13
13
c,
c, 55
e,
e, 99

j,j, 12
12

12

Project Evaluation
Technique PERT

13

Project Evaluation Technique

PERT

PERT is based on the assumption that an activitys

duration follows a probability distribution instead of
being a single value
Three time estimates are required to compute the
parameters of an activitys duration distribution:
pessimistic time (tp ) - the time the activity would
take if things did not go well
most likely time (tm ) - the consensus best
estimate of the activitys duration
optimistic time (to ) - the time the activity would
take if things did go well

Expected time calculation

14

Mean (expected time): te =

Variance: Vt =2 =

tp + 4 tm + to
6

tp - to
6

PERT analysis
15

1.
2.

3.

4.

5.

Draw the network.

Analyze the paths through the network and find the critical
path.
The length of the critical path is the mean of the project
duration probability distribution which is assumed to be normal
The standard deviation of the project duration probability
distribution is computed by adding the variances of the critical
activities (all of the activities that make up the critical path) and
taking the square root of that sum
Probability computations can now be made using the normal
distribution table.

Probability computation
16

Determine probability that project is

x - time
completed within specified
Z=

where = tp = project mean time

= project standard mean time
x = (proposed ) specified time

Normal Distribution of Whole Project

Time
17

Probability

= tp

Time

18

Obtaining Required Time

Estimates
1.

2.
3.
4.
5.
6.
7.

Estimates obtained from simple

regression
Furnished by experienced person
Heuristic assumptions
Dictated by customer requirements
Extracted from standard time data
Obtained from historical data
Generated by simulation

PERT Example

19

Immed. Optimistic Most Likely

Pessimistic
Activity Predec. Time (Hr.) Time (Hr.)
Time (Hr.)
A
-4
6
8
B
-1
4.5
5
C
A
3
3
3
D
A
4
5
6
E
A
0.5
1
1.5
F
B,C
3
4

PERT Example
20

PERT Network
D

C
B

F
G

PERT Example
21

Activity
Variance
A

Expected Time
6

B
C
D
E
F
G
H
I

4
3
5
1
4
2
6
5
J

3
5

4/9
4/9
0
1/9
1/36
1/9
4/9
1/9
1
1/9
4/9

PERT Example
22

Activity

ES

6
B
C
D
E
F
G
H
I
J
K

EF
0

LS

LF

Slack

0 *critical
0
4
5
9
6
9
6
9
6
11
15
20
9
6
7
12
13
6
9
13
9
13
9
11
16
18
7
13
19
14
20
1
13
18
13
18
0
19
22
20
23
1
18
23
18
23
0*

5
0*

0*

PERT Example
23

Vpath = VA + VC + VF + VI + VK

path

= 4/9 + 0 + 1/9 + 1 + 4/9

= 2
= 1.414

z = (24 - 23)/(24-23)/1.414 = .71

From the Standard Normal Distribution
table:
P(z < .71) = .5 + .2612 = .7612

CPM/PERT can answer the following important questions:

24

1.

Completion time? What are the risks involved?

2.

Critical activities

3.

4.

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?

Limitations to CPM/PERT
25

1.
2.
3.

4.

5.

Over emphasis on critical paths

Deterministic CPM model
Activity time estimates are subjective and depend
on judgment
PERT assumes a beta distribution for these time
estimates, but the actual distribution may be
different
PERT consistently underestimates the expected
project completion time due to alternate paths
becoming critical

To overcome the limitation, Monte Carlo simulations can be performed

on the network to eliminate the optimistic bias

Monte Carlo Simulation

26

1.
2.

3.

4.

5.

It uses the same data input as PERT

Then it will draw a set of durations for
all activities from its statistical
distribution
Then the network is calculated as the
usual CPM
The procedure is repeated a large
number of times
This answers the question of what is the
probability of meeting a milestone.

Critical index
27

Is a by-product of Monte Carlo

Simulation

Critical Index: the probability of an

activity to be critical the number of
times the activity will be in the critical
path

28

Resource Constraints

Resource Constraints
29

Resource constraints apply in number of

ways:
1.
2.
3.

To determine the duration of an activity

As a trade-off between time and cost
As a limited resource during scheduling

Resource Constraints contd.

30

It the activity is labor

intensive, it is
common to apply a
build up and rundown
period to and from
peak manning
This referred to as
mobilization and
demobilization.
Realizing that the
area of trapezoid
equals the work
scope, t, can be
calculated

Activity Duration
Calculation

31

S c.P max( tm td 2.tp / 2)

t = activity duration

tm= mobilization time

tp = time with peak manning level

td = demobilization time

S = scope of work (man hours)

c = net man hours per person per week

Pmax = peak manning level

32

PROJECT COST

Cost consideration in
project

33

Project managers may have the option or

requirement to crash the project, or
accelerate the completion of the project.

This is accomplished by reducing the length

of the critical path(s).

The length of the critical path is reduced by

reducing the duration of the activities on the
critical path.

34

Cost consideration in
project

If each activity requires the expenditure of an amount

of money to reduce its duration by one unit of time,
then the project manager selects the least cost critical
activity, reduces it by one time unit, and traces that
change through the remainder of the network.

As a result of a reduction in an activitys time, a new

critical path may be created.

When there is more than one critical path, each of the

critical paths must be reduced.

If the length of the project needs to be reduced further,

the process is repeated.

Project Crashing
35

Crashing
reducing project time by expending additional
resources
Crash time
an amount of time an activity is reduced
Crash cost
cost of reducing activity time
Goal
reduce project duration at minimum cost

Activity crashing
36

Activity cost

Crash
cost

Crashing activity
Slope = crash cost per unit time (cost
gradient)
Normal Activity

Normal
cost

Normal
time
Crash
time

Activity time

Cost gradient calculation

37

c = ( cD - cd )/ d - D
c is the cost gradient
cd is normal cost
cD is the crash cost
d is the normal duration
D is the crash duration

Time-Cost Relationship
Crashing costs increase as project duration decreases
Indirect costs increase as project duration increases
Reduce project length as long as crashing costs are less than indirect
costs

Time-Cost Tradeoff
Min total cost =
optimal project
time

cost

38

Total project cost

Indirect cost

Crash cost

time

Example
39

Activity

0-1
1-2
1-3
1-6
2-4
3-5
3-6
4-5
5-6
5-7
6-8
7-8

Normal time
Tn
(Days)
10
20
40
28
8
0
10
30
20
24
10
12

cost Cn
(LE)
200
200
1800
500
150
0
100
3000
2800
1000
200
400

Crash time
Tc
(Days)
5
10
30
20
8
0
6
10
8
14
6
8

Crash cost
Cc
(LE)
300
300
2700
580
150
0
260
6600
3400
1650
520
520

Gradient

100/5=20
100/10=10
900/10=90
80/8=10
--160/4=40
3600/20=180
600/12= 50
650/10= 65
320/4= 80
120/4= 30

Project Crashing example

40

2
8

12

7
4

12

3
4

5
4

6
4

Time Cost data

41

Activity Normal Normal Crash Crash Allowable slope

time
cost Rs time cost Rs crash time
1
2
3
4
5
6
7

12
8
4
12
4
4
4

3000
2000
4000
50000
500
500
1500
75000

7
5
3
9
1
1
3

5000
3500
7000
71000
1100
1100
22000
110700

5
3
1
3
3
3
1

400
500
3000
7000
200
200
7000

R500

R7000

2
8

12

R700
7
4

12

R400

3
4

To..
Project
duration = 31
Additional cost =
R2000
42

Project duration = 36

6
4

5
4

R3000

From..

R200

R200

R500

R7000

2
8

12

R700
7
4

R400

3
4
R3000

5
4
R200

6
4
R200

Practice Example
A social project manager is faced with a project with the following
activities:
44

Activity Description

Duration

Social work team to live in village

5w

Social research team to do survey

12w

Analyse results of survey

5w

Establish mother & child health program

14w

Establish rural credit programme

15w

Carry out immunization of under fives

4w

Draw network diagram and show the critical path. Calculate

project duration.