MinE424 - 05ControlOfProjects-CPM and PERT Methods (Part-1)

MinE424 - PROJECT MANAGEMENT IN MINING
CHAPTER 5
CONTROL OF PROJECTS - CPM AND PERT METHODS

Part-1
MinE424 - Project Management in Mining 1

CONTENT
5.1. Objectives of Project Control

5.2. The Gantt Chart
5.3. Drawing the Activity-on-Arrow (AoA) Network
• Activities and Events of A Project
• The Physical Construction of Diagrams
• Who Should Construct Diagrams and Make Time Estimates
5.4. Estimating the Duration of Project Activities

• Deterministic Approach
• Stochastic Approach
5.5. Critical Path Method (CPM)

• Activity and Event Times
• Critical Path
 The objectives of project control may vary with different

projects. The following figure shows the relative importance of
objectives for two kinds of project. In project 1, a “design to
cost” approach is taken. Here the budget is fixed and the
technological objectives are clearly specified. Cost,
performance and schedule are all given equal weight. In
project 2, the technological objectives are of paramount
importance and must be achieved, even if it means
compromising the schedule and budget in the process.
Project-1 Project-2
 The first situation is typical of standard construction and

manufacturing projects where a project team or contractor is to
supply a system or product in accordance with a given
schedule and budget. The second situation is typical of “cost
plus fixed fee” projects where the technological uncertainties
are high and urge against a project team or contractor
committing to a fixed cost and schedule. This situation is most
common in research and development environment.
 For the control of a project, followings should be defined:

• Who is responsible from the implementation?
• Which resources should be allocated?
• What is the expected start and finish dates of the project?

 A project network is actually a plan in its simplest form

defining all the activities in sequence, and establishing a
timetable for each activity, which eventually leads to project
completion time.
 A project network clearly defines the questions of “how”,

“who does what”, and “when”.

 When attempting to determine the completion date for any

project, whether it be the building of a bridge, organizing a
sales conference, the layout of a factory, the designing a new
piece of equipment or any other project, it is necessary to
timetable all the activities that make up the task, that is to say
a plan must be prepared. The first attempt at a formal
planning system was the Gantt chart.
 A Gannt chart shows all start and finish dates of dependent

and/or independent activities in a project graphically with
proportional and comparative lines/bars. If the lines/bars
overlap for the same time periods, it means that they are
independent or partially independent activities. If they are
dependent activities, then the ending of one event becomes the
start of other event.
Thesis Defense (Finish date)
Task 1 Defining a Specific Topic in a Broad Sense Task 10 Re-arranging the Topic Boundary and Methodology
Task 2 Literature Review Task 11 Re-performing the Modified Methodology Steps
Task 3 Finding the Gaps of Topic in the Literature Task 12 Technical Check of the Whole Thesis
Task 4 Re-arranging the Topic Boundary Task 13 Finding and Correcting the Gaps/Missing Points in the Thesis
Task 5 Setting the Problem Statement Task 14 Discussing and Interpreting the Results
Task 6 Setting the Objectives and Scopes Task 15 Conclusion
Task 7 Setting the Research Methodology Task 16 Structural Check of the Whole Thesis
Task 8 Setting the Study Motivation and Its Industrial Contributions Task 17 Preparation of the Defense Presentation
Task 9 Performing the Steps of the First-Identified Methodology Task 18 Thesis Defense

Date: 19th June, 2018

# Scheduled Actual # Scheduled Actual
Task 1 Completed Completed Task 10 Not started Not started
Task 2 37% completed 20% completed Task 11 Not started Not started
Task 3 Completed Completed Task 12 Not started Not started Gantt charts can be very
Task 4 Completed Completed Task 13 Not started Not started informative, combining
Task 5 Completed Completed Task 14 Not started Not started both planning and
Task 6 Completed Completed Task 15 Not started Not started recording of progress.
Task 9 72% completed 50% completed Task 18 Not started Not started

 The activity-on-arrow (AoA) system is more generally known

as critical path method (CPM) or program evaluation and
review technique (PERT).
 In AoA, a project is represented by an arrow diagram. CPM

methods allow the planner of a large project to see in graphic
form the relationships among various parts of a project; they
also allow to assess quickly, reasonably, and accurately the
consequence of changing the scope of a project.
 CPM is mostly used for planning and scheduling. When

developing an analytical tool, such as CPM, one must identify
and isolate the features of the system that need to be modeled
with two basic elements: i) Activities of a project and ii)
Events of a project.
Activities and Events of A Project
 An activity is an element of work entailed in the project.

 A project may be subdivided into activities - time consuming
tasks or subprojects. Ex: The project under consideration is the
construction of a house, the typical activities might be:
excavating the foundation, building forms, pouring concrete,
framing, applying siding, wiring, rough plumbing, finishing
plumbing.


 An event is the start and/or finish of an activity or group of
activities. Because time is an important parameter in the
scheduling and control of projects, any model, which is to
assist in the performance of these tasks, must take into account
of time.
 An important function of the critical- path method is to assign
times to the events in a project. Two distinguished events in
any project are the beginning event and the ending event. The
elapsed time between these two events is the total project time.
Some authorities may use the term “node” instead of event. It
has to be mentioned here that the term node in AoA has a
different significance to a node in activity-on-node (AoN).


 In projects, the start of certain activities must await the
completion of other activities. In order to construct a schedule
for a project, one must have the complete knowledge of these
precedence relations among activities.
Precedence relations when building up an electronic system

The Physical Construction of Diagrams

 Before drawing diagrams/networks, it is suggested to have a
practice on some conventions:
• Time flows from left to right.
• Head nodes (events) always have a number higher than
that of the tail node.
 This allows activities to be referred to simply and briefly by
their tail and head numbers, so that “activity 3-4” means only
“the activity that starts from node 3 and proceeds to 4; it can
not mean “the activity that starts from node 4 and finishes at
node 3”.


 Nodes (events) are represented by labels, with conventional
shapes-usually circles.
 Activities are represented by arrows, the arrow- heads being at
the completion of activities. Length and orientation of arrows
have no significance.
Different Ways of Connecting Two Nodes


 The node at the beginning of an activity is known as a “tail” or
preceding node, while, that at the conclusion of an activity is
known as a “head” or succeeding node. It is also convenient to
denote to tail and head nodes as i and j nodes.
 The expected time that will be required to carry an activity (the
duration of time) is written as a central subscript to the
activity.


 When deciding on the tails and heads for different activities
and flow in the diagram, it is essential to define the
dependencies between the activities:
• An event cannot be realized (or “be reached” or “occur”) until
all the activities leading into it are complete.
• No activity can start until its tail event is realized.
• All activities entering a node must be complete before any
leaving it.
Activity C is dependent upon

Activity A, but is not dependent
on Activity B.


There are two common logic errors when drawing a
diagram/network: Looping and Dangling.
Looping represents an impossible

situation here: “ activity R depends on
activity Q which depends on activity P
which depends on activity R which
depends on activity Q…”
Dangling here causes a hanging arrow

(9-10) with no result. Such arrows often
result from quickly inserted
afterthoughts. All nodes, except the first
and the last, must have at least one
activity entering and one activity leaving
them” and “ all activities must start and
finish with a node”.
Dummy Activities
 Dummy activities are fake activities that don’t consume any

time or resource.
 They are used to overcome the difficulties when establishing
logical and structural relationships in a network.
 They are shown by dashed lines.
 Directions of dummy activities are determined by
understanding the purpose of the dummy in the flow. They
can be considered as one-way dependency street where the
dependency flows from the tail of dummy to its head.

Dummy Activities
 In case that two or more activities may be performed in parallel:
Four different ways of adding a dummy variable

Dummy Activities
 When establishing logical relationships that cannot otherwise be

represented correctly:
Ex: Suppose that a certain project, task A and B must precede C, while task
E is preceded only by B. A quite common way that many beginners would
draw this network as shown in the first figure. The difficulty is that
although the relationship among A, B, C is correct, the diagram implies that
E must be preceded by both A and B (incorrect). A correct presentation of
network can be achieved by adding a dummy as in the second figure.

Dummy Activities
Example 5.1: Draw the (AOA) diagram so that the following precedence relation is satisfied:
i) E is preceded by B and C and ii) F is preceded by A and B.
Solution:
Incorrect: The diagram tells that F is preceded by A and B (correct) but E is

preceded by A, B and C (incorrect).
Correct: The diagram tells that F is preceded by A and B and E is preceded

by B and C.

Dummy Activities
Example 5.2: Draw the (AOA) diagram so that the following precedence relation is satisfied:
i) G is preceded by A, ii) E is preceded by A and B, and iii) F is preceded by B and C
Solution:
Incorrect: The diagram tells that G is preceded by A (correct), E is

preceded by A and B (correct) but F is preceded by A, B and C
(incorrect).
Correct: The diagram tells that G is preceded by A, E is preceded by

A and B, and F is preceded by B and C.

Dummy Activities
Example 5.3: The following table gives the precedence relations between activities when
changing a flat tire of a car. Draw the AoA diagram for the given information.
Preceding node Following node Estimated Duration, min
Description of activity
(i) (j) (Tij)
1 2 1.0 Remove coats
2 3 1.0 Procure jack and lug wrench
2 7 2.0 Procure spare
3 4 1.5 Remove hub cap, loosen nuts
3 5 0.5 Position jack
4 5 0 Dummy
4 6 1.0 Remove lug nuts
5 6 2.0 Jack up car
6 7 0.5 Remove flat
7 8 0.5 Place spare
7 11 2.0 Put flat away
8 9 1.0 Lower car
8 10 1.5 Tighten lug nuts
9 10 0 Dummy
9 11 1.0 Put jack away
10 11 2.0 Final tighten, replace hub cap
11 12 2.0 Clean up, put on coats

Dummy Activities
Solution:
4 6 8 10
9
3 5
1 2 7 11 12

Who Should Construct Diagrams and Make Time Estimates

 Only persons directly concerned with the management of a
project have sufficient knowledge of the relationships within it
to construct a proper model of it. Therefore, these persons will
be involved in the construction of diagrams, not a separate
research or CPM group.
 The proper person to estimate the duration of an activity is the
person who will supervise it. Management should review his
estimates, however, since there is tendency to insert liberal
factors. An easy way for a supervisor to become a hero is to
give a liberal time estimate for an activity, and then to finish
ahead of schedule.

 The basic approach to all project scheduling is to form an actual or

implied network that graphically portrays the relationships between
the tasks and milestones in the project. Several techniques evolved in
late 1950s for organizing and representing the basic information.
Best known today are the PERT (Program Evaluation and Review
Technique) and CPM (Critical Path Method).
 The major difference between the two is that CPM assumes that the
activity times are deterministic, while PERT views the time to
complete an activity as a random variable that can be characterized
by an optimistic, a pessimistic, and a most likely estimate of its
durations.
Important thing is to keep

the ongoing project duration
in acceptable limits with a
predetermined schedule, not
superficial and unrealistic
offers!

 To apply PERT/CPM, a thorough understanding of the project’s

requirements and structure is needed. The effort spent in identifying
activity relationships and constraints yields valuable insights. In
particular, four questions must be answered to begin the modeling
process:
• What are the chief project activities?
• What are the sequencing requirements or constraints for these
activities?
• Which activities can be conducted simultaneously?
• What are the estimated time requirements for each activity?
 A project is composed of a set of tasks. One organizational unit
performs each task. Most tasks can be broken down into activities. Each
activity is characterized by its technological specifications, drawings
and list of material requirements, quality control requirements, and so
on. The technological processes selected for each activity affect the
resources required, the materials needed, and the timetable.
 The process of dividing a task into activities and activities into sub
activities should be performed carefully to strike a proper balance
between size and duration. The following guidelines are recommended:
• The length of each activity should be approximately in the range of

0.5 to 2% of the length of the project. Thus if the project takes about 1
year, each activity should be between a day and a week.
• Critical activities that fall below this range should be included. For
example, a critical design review that is scheduled to last 2 days on a
3- year project should be included in the activity list because of its
pivotal importance.
• If the number of activities is very large (say, above 250), the project
should be divided into subprojects, and individual schedules
developed for each. Schedules with too many activities quickly
become awkward and are difficult to monitor and control.

 Two approaches are used for estimating the length of an

activity: the deterministic approach and the stochastic
approach.
 The deterministic approach ignores uncertainty and thus
results in a point estimate.
 The stochastic approach addresses the probabilistic elements
in a project by estimating both the expected duration of each
activity and its corresponding variance. Although tasks are
subject to random forces ands other uncertainties, the majority
of project managers prefer the deterministic approach because
of its simplicity and ease of understanding.

Deterministic Approach
 When past data for an activity similar to the one under
consideration are available and the variability in performance
is negligible, the duration of the activity may be estimated by
its mean; that is, the average time it took to perform the
activity in the past.
 A problem arises when no past data exist. This problem is
common in organizations that do not have an adequate
information system to collect and store data, and in R&D
projects where an activity is performed for the first time.
 To deal with this situation, three techniques are available: the
modular technique, the benchmark job technique, and the
parametric technique.

Modular Technique
 This technique is based on decomposing each activity into sub activities (or
modules), estimating the performance time of each module, and then
totaling the results to get an approximate performance time for the activity
Benchmark Job Technique
 This technique is best suited for projects containing many repetitions of

somewhat standard activities.
Ex: The installation of an electrical outlet takes on the average 10 minutes,
and there are 80 outlets in the new building, a total of 80 x 10 = 800 minutes
is required for this type of component. The benchmark job technique is
most appropriate when a project is composed of a set of basic elements
whose execution time is additive.

Parametric Technique
 This technique is based on cause-effect analysis. The first step is to

identify the independent variables. For example, in constructing a
tunnel an independent variable might be the length of the tunnel. If it
takes on average 60 hours to dig 1 meter, the time to dig a tunnel of l
can be estimated by T(l) = 60 x l , where time is considered the
dependent variable and the length of the tunnel considered the
independent variable.
 You may refer to regression analysis for the utilization of parametric
technique where the correlation between dependent and
independent variables may be estimated.

Stochastic Approach
 Only in rare instances is the exact duration of a planned
activity is known in advance. Therefore, to gain an
understanding of how long it will take to perform an activity, it
is logical to analyze past data and to construct a frequency
distribution of related activity durations (distribution fitting).

Stochastic Approach
Example 5.4: For an activity repeated previously, the company has the
given frequency table. After building the frequency graph (given in the
previous slide), you realize that the data may be fitted into Normal
distribution due to its symmetry. Find the expected duration of activity
and its spread (standard deviation).
fi, frequency 1 2 4 4 6 8 5 3 3 2 1 1
xi, duration 10 15 20 25 30 35 40 45 50 55 65 70
Mode, the most frequently observed data

Stochastic Approach
Solution:
1 ∑ 1 × 10 + 2 × 15 + ⋯ + (1 × 70) 1410
= = = = = = 35.25
∑ (1 + 2 + ⋯ + 1) 40
1
= ( − )
Note: Sample dataset is comparatively a small portion of population dataset. Then, the sum of squares of errors should be divided into (n-1).
1 1
= ( − ) = ( − )
−1 −1
1(10 − 35.25) +2(15 − 35.25) + ⋯ + 1(70 − 35.25)
= = 176.86 → = 176.86 = 13.3
39

Stochastic Approach
 While the normal distribution is symmetrical and easy to work
with, the distribution of activity durations is likely to be
skewed. Furthermore, the normal distribution has a long left
hand tail while actual performance time cannot be negative. A
better model of the distribution of activity lengths has proven
to be the beta distribution.
MinE424 - Project Management in Mining

Fitting of Beta Distribution
36
to the dataset in Example 5.4
Stochastic Approach
 In project scheduling by utilizing the PERT method,
probabilistic considerations are incorporated by assuming that
the time estimate for each activity can be derived from three
different values:
a= optimistic time, which will be required if execution goes extremely well
m= most likely time (mode), which will be required if execution is normal
b= pessimistic time, which will be required if everything goes badly
 Statistically speaking, (a) and (b) are estimates of the lower and
upper bounds of the frequency distribution, respectively. If the
activity is repeated a large number of times, only in about 0.5%
of the cases would the duration fall below the optimistic
estimate, (a), or above the pessimistic estimate,(b). The most
likely time, m, is an estimate of the mode (the highest point) of
the distribution.
Stochastic Approach
 To convert m, a, and b into estimates of the expected value E(x)
and variance (S2) of the elapsed time required by the activity,
two assumptions are made. The first is that the standard
deviation, s (square root of variance), equals one-sixth the
range of possible outcomes. The rationale for this assumption
is that the tails of many probability distributions (such as the
normal distribution) are considered to lie about 3 standard
deviations from the mean, implying a spread of about 6
standard deviations between tails (99% conf. interval for
normal distribution). In industry, statistical quality control
charts are constructed so that the spread between the upper
and lower control limits is approximately 6 standard
deviations.
−
=
6
Stochastic Approach
 The second assumption concerns the form of the distribution
and is needed to estimate the expected value, E(x). In this
regard, the definition of the three time estimates above provide
an intuitive justification that the duration of an activity may
follow a beta distribution with its unimodal point occurring at
m and its end points at a and b.
+4 +
( )=
6
Three cases of the beta distribution: (a) symmetric;(b) skewed to the right: (c) skewed to the left
Activity and Event Times

 The total project time (TPT) is the shortest time in which the
project can be completed, and this is determined by a sequence
(or sequences) of activities known as the critical path (or paths).
 To calculate the TPT, carry out a forward pass whereby the

earliest starting times (EST) for each activity are calculated. In
the calculation it will sometimes be necessary to refer to earliest
finishing time (EFT) of an activity.
EFT = EST + Duration
 The critical path, is then identified by carrying out a backward

pass whereby the latest finishing time (LFT) of an activity and its
associated latest starting time (LST)
LST = LFT − Duration

 It is important to recognize that activity times are indirectly
derived from the forward and backward passes which directly
give the event times for the nodes. A node has two times
associated with it: one, from the forward pass, its earliest event
time (EET), the earliest time the event can be realized; the other,
from the backward pass, its latest event time (LET), the latest
time by which the event must be realized if the total project time
is to be achieved. The EET is the EST of all emerging activities,
whilst the LET is the LFT of all entering activities.
EET
When drawing a critical path diagram, it is
recommended to use node (event) circles with the
EET in the top right quadrant and the LET in the
bottom right quadrant.
Node label LET

Sample diagram where the durations are given in weeks

Critical Path
For Activity E: For Activity D:
LET (latest event time) = 39 LET (latest event time) = 35

EET (earliest event time) = 20 EET (earliest event time) = 20
Duration of the activity = 10 Duration of the activity = 15
Slack (float)= (LET-EET)-Duration = 9 weeks Slack (float)= (LET-EET)-Duration = 0 weeks
It means that Activity E may start 9 Thus there is no slack or “spare” time in
weeks late, finish 9 weeks early or occupy activity D – if it starts late or the duration
9 weeks extra time without increasing the increases by any amount, the TPT will be
TPT (total project time). increased.
Critical Path
 The activities with no slack/float/spare time are called critical activities. For
the diagram above, B, D, and H are critical activities where late start of
these activities or any increase in their durations affect the TPT (total project
time). Therefore, Activities B, D, and H which have zero float determine the
critical path.
 Float is the only means of identifying the critical path.

Critical Path
 There are two types of floats; the total float and the free float.
= − −
= − −
Where
the number of the preceding event (node),

the number of the following event (node),
the earliest start of the preceding event,
the earliest start of the following event,
the latest start of the preceding event,
the latest start of the following event,
the activity duration
total float or slack
free float or free slack
Critical Path
 The total float is the measure of time interval within which an activity
may be started providing all preceding activities are completed as early
as possible and all following activities are completed as late as possible.
The activities on a critical path have zero total floats.
 The free float is the free time in scheduling that activity providing that
both its predecessor and its successor events take place as early as
possible.
 The critical path is conventionally indicated by heavy dark or red
colored lines connecting the critical path.
 It is also important to note that four simple factors characterize the
critical path:
• It starts at the first node.
• It is continuous.
• It ends at the last node.
• It has no floats.

MinE424 - 05ControlOfProjects-CPM and PERT Methods (Part-1)

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

MinE424 - 05ControlOfProjects-CPM and PERT Methods (Part-1)

Uploaded by

Copyright:

Available Formats

MinE424 - PROJECT MANAGEMENT IN MINING

CONTROL OF PROJECTS - CPM AND PERT METHODS

MinE424 - Project Management in Mining 1

5.1. Objectives of Project Control

5.4. Estimating the Duration of Project Activities

5.5. Critical Path Method (CPM)

 The objectives of project control may vary with different

 The first situation is typical of standard construction and

 For the control of a project, followings should be defined:

MinE424 - Project Management in Mining 4

 A project network is actually a plan in its simplest form

 A project network clearly defines the questions of “how”,

MinE424 - Project Management in Mining 5

 When attempting to determine the completion date for any

 A Gannt chart shows all start and finish dates of dependent

Thesis Defense (Finish date)

MinE424 - Project Management in Mining 7

Date: 19th June, 2018

MinE424 - Project Management in Mining 8

 The activity-on-arrow (AoA) system is more generally known

 In AoA, a project is represented by an arrow diagram. CPM

 CPM is mostly used for planning and scheduling. When

Activities and Events of A Project

 An activity is an element of work entailed in the project.

MinE424 - Project Management in Mining 10

Activities and Events of A Project

MinE424 - Project Management in Mining 11

Activities and Events of A Project

Precedence relations when building up an electronic system

MinE424 - Project Management in Mining 12

The Physical Construction of Diagrams

MinE424 - Project Management in Mining 13

The Physical Construction of Diagrams

Different Ways of Connecting Two Nodes

The Physical Construction of Diagrams

MinE424 - Project Management in Mining 15

The Physical Construction of Diagrams

Activity C is dependent upon

MinE424 - Project Management in Mining 16

The Physical Construction of Diagrams

Looping represents an impossible

Dangling here causes a hanging arrow

The Physical Construction of Diagrams

 Dummy activities are fake activities that don’t consume any

MinE424 - Project Management in Mining 18

The Physical Construction of Diagrams

 In case that two or more activities may be performed in parallel:

Four different ways of adding a dummy variable

MinE424 - Project Management in Mining 19

The Physical Construction of Diagrams

 When establishing logical relationships that cannot otherwise be

MinE424 - Project Management in Mining 20

The Physical Construction of Diagrams

Incorrect: The diagram tells that F is preceded by A and B (correct) but E is

Correct: The diagram tells that F is preceded by A and B and E is preceded

MinE424 - Project Management in Mining 21

The Physical Construction of Diagrams

Incorrect: The diagram tells that G is preceded by A (correct), E is

Correct: The diagram tells that G is preceded by A, E is preceded by

MinE424 - Project Management in Mining 22

The Physical Construction of Diagrams

MinE424 - Project Management in Mining 23

The Physical Construction of Diagrams