PERT/CPM
You have been asked to fill-in for your boss this week. Your boss’s assistant informs you that he had scheduled an
engagement to teach a group of students at the local University about PERT/CPM approach to project scheduling
and has asked that you do it instead. In an initial write-up for the presentation, discuss the key elements of
PERT/CPM to include (but not limited to) assumptions, how it works, and expected outcomes. Respond to at least
two of your classmates’ postings.
“Two basic approaches to project management, Program Evaluation and Review Technique
(PERT) and Critical Path Method (CPM), can help establish efficient scheduling of project
activities” (Lawrence & Pasternack, 2002, p. 302). Both methods were developed in the 1950’s
and in recent years have become almost synonymous with one another. There are many
similarities in the general concept, but they are definitely different approaches and it should be
noted as such.
Their similarities are that the modeler has to identify the activities and assign them precedence
relations. In other words it is critical that each activity be identified and then the activities are
charted to find out how the activity affects the completion of other activities. One of the most
important steps in the models is to determine the immediate predecessors and highlight them as
such. This is to basically identify steps that must be carried out prior to certain other steps in the
model. We all know that not every step has an immediate predecessor but the ones that do are
severely impacted by the relationship that exists within the model. For instance if an immediate
predecessor falls behind it will obviously impact the ability to move forward even to the point of
causing project failure if not corrected for. This modeling allows for managers to identify
critical paths, the critical path shows a sequence of activities that have no slack time and how
they must be completed in sequence to ensure success. Having the critical points clearly
identified allows managers to know early where possible snag points might come and plan
contingencies if they do.
Intervention.org (2003) has some interesting descriptors of the CPM/PERT models stating,
“There are six steps that are common to both models:
I.
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.
II.
Develop the relationships among the activities. Decide which activities must precede and
which must follow others.
III.
Draw the "Network" connecting all the activities. Each Activity should have unique event
numbers. Dummy arrows are used where required to avoid giving the same numbering to
two activities.
IV.
Assign time and/or cost estimates to each activity
V.
VI.
Compute the longest time path through the network. This is called the critical path.
Use the Network to help plan, schedule, monitor and control the project.”
While there is no guarantee that projects can be planned flawlessly using the tools allows a
method for managers to move toward an end.
PERT and CPM start to individualize from here. To simplify the theory, PERT treats the
individual activity completion time as random variables with probability distributions, whereas
CPM tends to lean more toward a concept of money driving the train assuming that the
completion time of the activities are based on the amount of money spent on the tasks.
Now since we tend to lump the models together let’s get back to that goal. In order to create the
model and generate a projected completion time there are some assumptions that have to be
made. In our text book Lawrence & Pasternack (2002, p. 280) list three specific assumption for
creating a model; “A critical path can be determined by using the mean completion time for the
activities as if they were fixed completion times, the time to complete one activity is independent
of the time needed to complete another activity, and there are enough activities on the critical
path so that the distribution of the project completion time can be approximated by a normal
distribution.” To make all of this a bit simplified the first assumption is basically starting the
critical path will not change. The times might adjust but in using the mean time a solid
foundation can be built. In the second assumption all I am saying is that previous tasks might
prolong the entire project, but the time to complete a step should not change due to other
steps. The third assumption is just stating that a larger pool of activities (random variables) to
work with will aid in allowing normal distribution, you might recall from statistics that 30 is a
good starting point to allow for normal distribution to be calculated. The CPM model
additionally adds an assumption that there are two crucial time points for an activity the normal
completion time and the crash completion time and the percentage decrease between them will
be equal to the normal cost and the cash cost percentage increase, making a linear assumption so
it should remain a constant up or down a slope.
There are a number of tools that are available to assist in generating such models. I have heard
there is a software package, Microsoft Project, which is supposedly very efficient in generating
additional reports from the PERT/CPM Models that managers can use to track progress and in
the planning phases can be helpful in estimating crash points and critical paths. For example a
Gantt chart is a tool used quite often to track progress and this software apparently will generate
one for the user. If a person is educated enough to input the data appropriately the tools can
generate models for managers to forecast, plan, manage, and steer team members. The goal is to
be able to accurately plan a project and then use the guideline to keep it on track.
Reference
Interventions.org. (2003). Pert/cpm for project scheduling & management. Retrieved from
http://www.interventions.org/pertcpm.html
Lawrence, J., & Pasternack, B. (2002). Applied management science: Modeling, spreadsheet
analysis, and communication for decision making (2nd ed.). Hoboken,
NJ: John Wiley & Sons, Inc. ISBN:9780471391906