2. Project Management: A comparative view
Operation research techniques: PERT and CPM
The methods are essentially network-oriented techniques
basically time-oriented methods
In CPM activities are shown as a network of precedence relationships using
activity-on node network construction (where each activity is represented by
a node )
Single estimate of activity time
Deterministic activity times
Used IN: for the jobs of repetitive in nature
3. In PERT activities are shown as a network of precedence
relationships using activity-on arrow network construction
(each activity is represented by an arc)
Multiple time estimates
Probabilistic activity times
Used IN: for non-repetitive jobs, where the time and cost estimates
tend to be quite uncertain (uses probabilistic time estimates)
4. Benefits:
Useful at many stages of project management
Mathematically simple
Give critical path and slack time
Provide project documentation
Useful in monitoring costs
5. Steps
1. Define the Project and all of its significant activities or tasks. The Project (made up
of several tasks) should have only a single start activity and a single finish activity.
2. Develop the relationship among the activities. Decide which activities must precede
and which must follow others
3. Draw the ‘network’ connecting all the activities. Each activity should have a unique
event number.
4. Assign time and/or cost estimates to each activity
5. Compute the longest time path through the network. This is called the critical
path.
6. Use the Network to help plan, schedule, and monitor and control the project
6. An example
The RELIABLE CONSTRUCTION COMPANY has just made the winning bid of $5.4
million to construct a new plant for a major manufacturer. The manufacturer needs
the plant to go into operation within a year. Therefore, the contract incudes the
following provisions:
• A penalty of $300,000 if Reliable has not completed construction by the deadline 47
weeks from now.
• To provide additional incentive for speedy construction, a bonus of $150,000 will be
paid to Reliable if the plant is completed within 40 weeks.
8. Probable questions
Immediate predecessors: Activities must be completed by no later than the starting time of the
given activity.
Immediate predecessors can be more than one.
1. How can the project be displayed graphically?
2. What is the total time required to complete the project if no delays occur?
3. When do the individual activities need to start and finish (at the latest) to meet
this project completion time?
4. When can the individual activities start and finish (at the earliest) if no delays
occur?
5. Which are the critical bottleneck activities?
6. For the other activities, how much delay can be tolerated without delaying
project completion?
9. How can the project be displayed graphically?
Using project network- consists of a number of nodes and arcs
11. 2. What is the total time required to complete the project if no delays
occur?
3. When do the individual activities need to start and finish (at the
latest) to meet this project completion time?
4. When can the individual activities start and finish (at the earliest)
if no delays occur?
5. Which are the critical bottleneck activities?
6. For the other activities, how much delay can be tolerated without
delaying project completion?
12. Sum total of duration all the activities = 79 weeks
We have several paths with several lengths ( 31 to 44 weeks)
Critical path: the project duration will be equal to the length of the longest
path.
