CPM AND PERT NETWORKS

Definitions
 Activity. It is a clearly defined project element, a job or a
task which requires the consumption of resources including
time. It is denoted by an arrow.
 Event. An event describes the start or completion of an
activity. It is denoted by a numbered circle.
 Path. A path is an unbroken chain of activities from the
initiating node to some other node, generally to the last
node indicating the end or completion of the project.
 Dummy Activity. A dummy activity is that activity which has
a logical function only and consumes no time or resources.
It is denoted by a dotted arrow. There are two types of
dummies:
 Identity Dummy. It helps to keep the designation of each
activity unique or different from another.
 Dependency Dummy. It helps to keep the logic correct.

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2
 Rules and Conventions

 Activity arrows should be drawn from left to right

indicating progressive approach towards the
ultimate objective or the final event.
 Crossing of activity arrows should be avoided.
Arrows should be drawn as straight or bent
lines but not curved lines.
 Avoid use of unnecessary dummies.
 Activities are set in the order of their execution.
Events are set in the order of their occurrence.

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 Rules and Conventions

 Head event number should be greater than tail

event number. No event is numbered until the
tail event of each activity arrow ending into that
event has been numbered.
 There should be no danglers or loops. Danglers
are activities which lead no where. All activities
must be connected to events and the finishing
activities must be connected to the finish event
of the project.

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4
 Critical Path Method

 It is used where activity duration is known with

certainty.
 Activities are identified.
 Dependency of activities is determined
 Network is drawn
 Earliest start times and latest finish times are
calculated
 Critical path and critical activities are identified

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5
 Example

 Rasoi Appliances wants to launch a newly

designed microwave oven.
 Activities required for the launch have been
identified. Their relationship with each other
and the activity duration have also been
determined.

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6
 Activity Activity Description Predecessor Time
Symbol (days)
A Develop advertising plan - 6
B Develop promotion and training - 7
materials plan
C Develop training plan - 8
D Schedule Radio,TV and print media A 20
advertising
E Develop advertising copy A 18
F Prepare promotional material for in- B 9
store introduction
G Prepare material for training of B 8
stores representatives
H Conduct pre-introduction advertising D, E 7
campaign
I Select store representatives for C 2
training
J Conduct training G, I 14
K Final in-store launch of product F, H and J 10
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7
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8
 Calculating Earliest Start Time (EST)

 The earliest that the project can start is at

time zero.
 The earliest finish time for an activity is the
earliest start time + activity duration.
 The earliest start time of an activity which is
dependent on two or more activities is the
time at which all the preceding activities are
completed.

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 Node
At Node
Node 7 is8,the
6,
5,
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2,
3,
9, westarting
EST get
is = EST
= EST event
at at for activity
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26
D H
6 7
20
6 L
A 2 E
6 5 24
18 33 43
0
F K
7 8 9
9 10
1 B G
3 8
7
15
8
C I J
4 7
8 2 14

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10
 Latest Finish Time

 The project will take 43 days.

 Start form Node 9 as 43 days and work
backward to find out the latest time when
the starting event of an activity must occur,
or the latest time by which all preceding
activities must finish so that the project is
not delayed

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11
AtAtNode
Node 3,AtLFT
2, is =
Node
LFT 6,LFT
8,
5,
4,
7, LFT
at at
is Node
Node 5 –6at–Activity
= LFT Activity
Node 697
8 Duration Duration
8 –Activity
Duration of of
G or
E orof IJKLH
At Node 1, LST = 0
LFT at Node
LFT= at Node 43
33
== 19
26
33
7 –8 2
–
– 7–
10
0
14 ==Activity
26
=17
19
Activity
Duration of F
33 Duration of D.
19 – 8 =11 or 33 – 9 = 24
IfTake
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at 24 then the At Node
project will2,
getLFT is = LFT
delayed. 6 is = 11

26 26
D H
6 7
20
6 L
A E
2
6 18 5 24 26
6 33 43
0
F K
11 8 10 9
7 9
1 B G
7 3 8
33 43
0 8 15
C I J
4 7
8 2 14
17
19
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12
 Floats
 Spare time in an activity is called float. It is
used to economise on resources without
affecting the overall duration of the project.
 Types of floats
 Total float
 Free float
 Interference float
 Independent float

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13
 4 26
G

8 30

 Total
Total
TotalFloat. =
Float. 30 – 4–
= 30
Float. It– 43is=–the
23
3 = 23
spare time available on any given
Free
FreeFloat. = 26
Float. – 4–––44
=if30
26 3–= –3193=event
=2319 occurred at its earliest time
activity
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23
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– 19 = 4Duration.
Earliest Tail
– Activity Duration
= 30Tail
Latest – 4– –Duration.
3 = 23
= 26 – 4 – 3 = 19
= 26 – 8 – 3 = 15

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14
 Calculation of floats

Activity Total Float Free Float Interference Independent

(TL Head – TE (TE Head – TE Float Float
Tail – Duration) Tail – Duration ) (Total Float – (TE Head – TL
Free Float) Tail – Duration)
A 6 – 0 – 6 =0
B 11-0-7=4 7-0-7=0 4-0=4 7-0-7=0
C 17-0-8=9 8-0-8=0 9-0=9 8-0-8=0
D 26-6-20=0
E 26-6-18=2 24-6-18=0 2-0=2 24-6-18=0
F 33-7-9=17 33-7-9=17 17-17=0 33-11-9=13
G 19-7-8=4 15-7-8=0 4-0=4 15-11-8 (0)
H 33-26-7=0

I 19-8-2=9 15-8-2=5 9-5=4 15-17-2 (0)

J 33-15-14=4 33-15-14=4 4-4=0 33-19-14=0
K 43-33-10=0

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15
Identifying Critical Activities and Critical
Path
 All activities whose floats are zero are
called critical activities. They are critical as
they have no spare time available for their
execution. Critical activities have the same
EFT and LST at their start and finish nodes
and have no float.
 Management must exercise strict control to
ensure that critical activities are executed
as per schedule.
 The path through these activities is called
critical path.
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16
Identifying Critical Activities and Critical
Path
 All activities whose floats are zero are
called critical activities. They are critical as
they have no spare time available for their
execution. Critical activities have the same
EFT and LST at their start and finish nodes
and have no float.
 Management must exercise strict control to
ensure that critical activities are executed
as per schedule.
 The path through these activities is called
critical path.
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17
 26 26
D H
6
20 7
6 L
A E
2
6 5 24
18 26 33 43
0 6
F K
11 8 9
7 9 10
B G
1 3
7 8
33 43
0 8 15
C I J
4
8 7
2 14
17
19
A,D,H and K are critical activities. Critical Path is 1 -2 – 7- 8 - 9

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 Activity on Node Network

 Computer packages draw activity on node

networks
 Nodes represent the activities.
 Arrows merely show their logical relationship.
 Nodes representing activities which start the
project may be connected to a milestone ‘start’
if desired.
 Dummy activities are not used.
 Arrows may cross each other.
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 Activity on Node Network

 For our purpose the node shall be drawn as

follows
Earliest Identity Earliest
start time finish
time
Total Description
Float
Latest Duration Latest
start time finish
time

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 Activity on Node Network

 A, B and C start the project

A

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 Activities D and E follow A; F and G follow B;
and I follows C. Let us add these to the network.
D
A
20
6
E

18

B F

7 9

8
C I

8 2
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 Activity H is dependent on completion of D and E; and J is
dependent on completion of G and I. Let us add these to the
network.
D H
A
20 7
6
E

18

B F
J
7 9

G 14

8
C I

8 2
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 Activity K is dependent on completion of H and J.

D H
A
20 7
6
E K

18 10

B F
J
7 9

G 14

8
C I

8 2
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24
 Let us compute EST by a forward pass. EFT = EST +
Duration.

6 D 26 26 H 33
0 A 6
20 7
6
6 E 24 33 K 43

18 10

0 B 7 7 F 16
15 J 29
7 9

7 G 15 14

8
0 C 8 8 I 10

8 2
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 Let us compute LFT by a backward pass. LST = LFT –
Duration.

6 D 26 26 H 33
0 A 6
6 20 26 26 7 33
0 6 6
6 E 24 33 K 43

8 18 26 33 10 43

0 B 7 7 F 16
15 J 29
4 7 11 24 9 33

7 G 15 19 14 33

11 8 19
0 C 8 8 I 10

9 8 17 17 2 19
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 Let us compute total float.
 Total Float = LFT – EFT = LST – EST

6 D 26 26 H 33
0 A 6 0 0
0 6 20 26 26 7 33
0 6 6
6 E 24 33 K 43
0
8 18 26 33 10 43

0 B 7 7 F 16
4 17 15 J 29
4 7 11 24 9 33 4
7 G 15 19 14 33
4
11 8 19
0 C 8 8 I 10
9 9
9 8 17 17 2 19
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27
 Activities A, D, H and K have zero float and are critical.
 The critical path is A – D – H – K, and the project will
take 43 days.
6 D 26 26 H 33
0 A 6 0 0
0 6 20 26 26 7 33
0 6 6
6 E 24 33 K 43
0
8 18 26 33 10 43

0 B 7 7 F 16
4 17 15 J 29
4 7 11 24 9 33 4
7 G 15 19 14 33
4
11 8 19
0 C 8 8 I 10
9 9
9 8 17 17 2 19
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 Lags

 Lags show the minimum amount of time a

dependent activity must be delayed to begin
or end. Lags can also be used to constrain
the start and finish of an activity. Lag
relationships can be classified as:
 Start to Start
 Start to Finish
 Finish to Start
 Finish to Finish

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29
 Start to Start

Digging trench
for cable 5 kms

Laying of cable
Lag 1 day 5 kms

Filling of trench
Lag 1 day 5 kms

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 Start to Finish

Documentation

Lag 2 days

Testing

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 Finish to Start

Erecting Pouring Removing

formwork concrete formwork

Lag 2
weeks

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32
 Finish to Finish

Assembling prototype Lag 2 weeks

Testing

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 Lags

Assembling prototype Lag 2 weeks

Testing
Lag 3 weeks

R.B. Khanna
A combination of lags may also be used
34
 Cost Crashing
 Some activities in a project can be completed in shorter
time by employing extra resources. But the duration of all
activities cannot be reduced by increasing resources
because of their nature or because of the restrictions on
employment due to space constraints and so on.
 If an activity can be completed earlier, extra cost on extra
resources will have to be incurred, but if this reduces the
overall duration of the project this will result in reduction
of the overhead costs.
 Completing an activity in a shorter time than normal is
referred to as activity crashing and the additional cost is
called crash cost.

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35
 Example
Activity Dependency Normal Crash Normal Crash Cost
Time Time Cost (Increase per day)
A START 4 4 4000 -
B START 8 6 8000 1500
C F, D, FINISH 3 3 600 -
D B 6 5 900 150
E START 7 5 350 100
F A 15 12 9000 900
G B 12 10 1200 200
H G, FINISH 10 8 1000 150
J L, FINISH 5 4 1000 300
K E 9 7 900 150
L G&K 11 8 2200 350
Fixed cost is Rs 500 per day.
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36
 Solution

 Draw the network.

 Calculate EST and LFT using normal times of activity
duration.
 Identify critical activities and path.
 The duration of the project will reduce only if activities on
critical path are crashed.
 Crash the activity which is cheapest to crash.
 After crashing any activity, recompute the timings and
identify critical path. The path may change causing the
critical activities to change.
 Continue crashing activities in this manner till the
objective has been achieved, i.e. lowest cost of project or
minimum time.

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37
Total cost Rs 47150
Direct cost Rs 29150
4 19
Indirect cost Rs 18000
C
A F18
2 5 3
4 15
0 D
8
6 33
B 36
1
8 3 20
8
0 H 9
G 6 20 10
7 12 I
20 31
K L J
E
4 7 8
7 9 11 5
36

11 20 31
B, G, L and J are critical activities and should be considered for crashing

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38
 Activity Crash by Cost of crashing per
Days day
B 2 1500
G 2 200
L 3 350

J 1 300

Activity G is the cheapest to crash. Crash G by 2 days.

Recompute the timings and identify the critical path.

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39
Total cost Rs 46550 Cost reduced by Rs 600
Direct cost Rs 29550 Time reduced by 2 days
Indirect cost Rs 17000 4 19
C
A F16
2 5 3
4 15
0 D
8
6 31
B 34
1
8 3 18
8
0 H 9
G 6 18 10
7 10 I
18 29
K L J
E
4 7 8
7 9 11 5
34

9
18 29
B, G, L and J are still critical activities. B, L and J should be considered for
crashing

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40
 Activity Crash by Cost of crashing per
Days day
B 2 1500
L 3 350

J 1 300

Activity J is the cheapest to crash. Crash J by 1 days.

Recompute the timings and identify the critical path.

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41
Total cost Rs 46350 Cost reduced by Rs 800
Direct cost Rs 29850 Time reduced by 3 days
Indirect cost Rs 16500 4 19
C
A F15
2 5 3
4 15
0 D
8
6 30
B 33
1
8 3 18
8
0 H 9
G 6 18 10
7 10 I
18 29
K L J
E
4 7 8
7 9 11 4
33

9
18 29
B, G, L and J are still critical activities. B, and L should be considered for
crashing

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42
 Activity Crash by Cost of crashing per
Days day
B 2 1500
L 3 350

Activity L is the cheapest to crash. Crash L by 3 days.

Recompute the timings and identify the critical path.

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43
Total cost Rs 45900 Cost reduced by Rs 1250
Direct cost Rs 30900 Time reduced by 6 days
Indirect cost Rs 15000 4 19
C
A F12
2 5 3
4 15
0 D
8
6 27
B 30
1
8 3 18
8
0 H 9
G 6 18 10
7 10 I
18 26
K L J
E
4 7 8
7 9 8 4
30

9
18 26
B, G, L and J are still critical activities. B should be considered for crashing

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44
 Activity Crash by Cost of crashing per
Days day
B 2 1500

Crash activity B by 2 days

Recompute the timings and identify the critical path.

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45
Total cost Rs 47900 Cost increased by Rs 750
Direct cost Rs 33900 Time reduced by 8 days
4 19
Indirect cost Rs 14000
C
A F12
2 5 3
4 15
0 D
6
6 27
B 28
1
6 3 16
6
0 H 9
G 6 16 10
7 10 I
16 24
K L J
E
4 7 8
7 9 8 4
28

7
16 Even if we
B, G, L, J, E and K are now critical activities. 24crash E or K the
duration on path B – G – L – J cannot be reduced any further. No further
crashing is necessary

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46
Activity Crashed by Duration of Direct Indirect Total
Crashed (Days) Project Costs Costs Cost
Normal - 36 29150 18000 47150
G 2 34 29550 17000 46550
J 1 33 29850 16500 46350
L 3 30 30900 15000 45900
B 2 28 33900 14000 47900

The project can be completed in 30 days at a least cost of Rs 45900.

The minimum time required to complete the project is 28 days at a cost of
Rs 47900

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47
 PERT Network

 PERT – Programme Evaluation and

Review Technique – is used in
probabilistic situations when the duration
of activities is not known with certainty.
 Three time estimates are used for activity
duration – pessimistic time, optimistic time
and most likely time.
 Mean time for each activity is calculated.
 Network is drawn as for CPM with mean
times as activity durations
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48
 PERT Network

 Critical activities are identified.

 Standard deviation on the critical path is
calculated.
 Using the standard deviation and the mean
and assuming normal distribution, project
duration with different levels of confidence or
vice versa can be computed.

R.B. Khanna 49
 PERT - Network

 to  4t m  t p
Mean Time 
6

t p  to
Standard Deviation 
6
 Standard deviation cannot be added. Variance can be
added. Standard deviation on the critical path is

  SDA    SDB   ...

2 2

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50
 PERT - Example
Activity Predecessor Optimistic Time Most likely Pessimistic
(to) Time (tm) Time (tp)
A - 1 2 3
B - 1 2 3
C - 1 2 3
D A 1 2 9
E A 2 3 10
F B 3 6 15
G B 2 5 14
H D, E 1 4 7
J C 4 9 20
K J, G 1 2 9
L H, F, K, 4 4 4
Finish
R.B. Khanna
51
 Solution
Activity Optimistic Most Pessimistic Mean Standard
Time (to) likely Time (tp) Time Deviation
Time (tm)
A 1 2 3 2 0.33
B 1 2 3 2 0.33
C 1 2 3 2 0.33
D 1 2 9 3 1.33
E 2 3 10 4 1.33
F 3 6 15 7 2.00
G 2 5 14 6 2.00
H 1 4 7 4 1.00
J 4 9 20 10 2.67
K 1 2 9 3 1.33
L 4 4 4 4 0
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52
  Draw the network and find critical activities
5
D
5 1
3 1 6
2
A E H
2 6
2 4 4
7 1
0 1 15 19
2
B F L
1 3 8 9
2 7 4
G
0 6 6 1
1
2 12 5 9
C J K
4 7 3
2 10
2
1
C, J, K and L are critical activities. Critical path is 1 – 42– 7 – 8 – 9
Project will be completed in 19 days or less with 50% confidence.

R.B. Khanna 53
Activity Optimistic Most Pessimistic Mean Standard
Time (to) likely Time (tp) Time Deviation
Time (tm)
C 1 2 3 2 0.33
J 4 9 20 10 2.67
K 1 2 9 3 1.33
L 4 4 4 4 0

S. D.   SDC    SDJ    SDK    SDL 

2 2 2 2

   0.33  2
  2.67    1.33    0 
2 2 2

3

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54
  With 84% level of confidence how much time would the
project take?
 PERT assumes that the distribution of the total project
completion time is normal. 84% represents Mean + 1
standard deviation. We can say with 84% level of
confidence that the project will finish in 22 weeks.
 What are the chances that the project will finish in 20
weeks?

x 0.33 SD
z

20  19
  0.33
3
19 20
From normal distribution tables the probability when z =0.33 is 0.6290.
There is a 63% chance that the project will finish in 20 weeks.

R.B. Khanna
55
 Differences – PERT and CPM
 PERT is a probabilistic model and is based on three time
estimates. It is used mainly for projects where the activity
durations are uncertain, like research and development
projects. Levels of confidence and probabilities can be
associated with the completion date of a project.
 CPM is based on certainty of the activity durations. It is
used for projects where there is certainty about the time
that each activity would take. The project completion
duration is not probabilistic but is certain.

R.B. Khanna 56