Module – 4
PERT and CPM Network analysis: Introduction,
Construction of networks, Fulkerson’s rule for numbering
the nodes, AON and AOA diagrams; Critical path method to
find the expected completion time of a project,
determination of floats in networks, PERT networks,
determining the probability of completing a project,
predicting the completion time of project; Cost analysis in
networks. Crashing of networks- Problems.
Queuing Theory: Queuing systems and their
characteristics, Pure-birth and Pure-death models (only
equations), Kendall & Lee’s notation of Queuing, empirical
queuing models – Numerical on M/M/1 and M/M/C
Queuing models. [Link] 10 Hours
PERT and CPM
PERT and CPM are the techniques graphically depicting the
proposed projects in the form of network diagram.
PERT stands for Programme Evaluation & Review Technique
and CPM represents Critical Path Method.
Both are network based project management techniques
useful for the basic managerial functions such as planning,
scheduling, coordinating and controlling.
These techniques exhibit the flow of activities and events of
the project in a sequential manner and helpful in
coordinating and completion of the project in time.
These techniques minimizes the production delays,
interruptions and conflicts.
Project Management
A project is an interrelated group of activities or
tasks that has a definite starting and ending point
and that results in a unique product or service.
Project management is a scientific way of planning,
scheduling, coordinating and controlling the
various aspects of a project such as time, money,
materials, manpower and other resources.
PERT is a sophisticated tool used in planning, scheduling and
controlling large projects consisting of number of activities and
with lot of uncertainty in completion times.
This technique was developed primarily to simplify the planning
and scheduling of large and complex projects.
It was developed for the U.S. Navy Special Projects Office in
1957 to support Polaris nuclear submarine project. by Booz
Allen Hamilton, an American consulting firm.
PERT needs a high degree of planning skill and greater amount
of details, hence, the costs are higher than the conventional
methods of planning and control.
This technique is suitable for innovative projects such as
Satellite launching programme, R & D activities, etc.
Critical Path Method or CPM is a statistical technique of
project management used for planning, scheduling,
coordination and control of various activities in a project.
This technique was developed in late 1950s by Morgan R.
Walker of Dupont and James E. Kelley of Remington Rand.
CPM technique is commonly used for all kind of projects
such as construction, aerospace, defense, software
development, product development, engineering, plant
maintenance, etc.
The first time CPM was used in 1966 while constructing the
former World Trade Center Twin Towers in New York City.
Sl. BASIS FOR
No. PERT CPM
COMPARISON
1 Meaning PERT is a project CPM is a statistical technique
management technique, of project management that
used to manage uncertain manages well defined activities
activities of a project. of a project.
2 What is it? A technique of planning A method to control cost and
and control of time. time.
3 Orientation Event-oriented Activity-oriented
4 Suitable for Research and Non-research projects like civil
Development Project construction, ship building, etc.
5 Model Probabilistic Model Deterministic Model
6 Focuses on Time Time-cost trade-off
7 Estimates Three time estimates One time estimate
8 Appropriate for High precision time Reasonable time estimate
estimate
9 Management of Unpredictable Activities Predictable activities
10 Nature of jobs Non-repetitive nature Repetitive nature
Network diagram
It is an arrow diagram shows inter-dependencies
(precedence relationship) among activities of the project.
It looks like a chart with series of boxes and arrows to
describe the relationship between the activities.
It is used to map out the schedule and work sequence for
the project and track its progress through each stage.
Two types of network diagrams are used in project
management:
i. Activity On Arrow
ii. Activity On Node.
Activity: Any individual operation or task, which consume
resources and need time to accomplish is known as Activity.
An arrow is used to represent the activity with its leading
head indicating the direction of progress in the project.
Activity can be addressed by a number or symbol written
over the arrow.
It can also be represented by naming its starting node and
end node. There are four types of activities, namely
Predecessor, Successor, Concurrent and Dummy.
Event: The beginning and end point of an activity is called
event. It is also known as node or connector.
It will not consume any resources such as money, material
or time. It is represented by a circle in the network.
There are three types namely Merge event, Burst event and
Merge & Burst event.
i. Activity On Arrow (AOA) Network
In AOA network, arrows represents activities of the project.
The tail of the arrow represents start of the activity and the
head represents finish.
Each arrow connects two circles or boxes known as nodes.
Dashed arrows are used to represent dummy activities.
ii. Activity On Node (AON) Networks
In AOA networks, each box, or node, represents activity.
Arrows represents the relationships between the different
activities. These boxes or nodes are connected from
beginning to end with arrows to depict a logical
dependencies between the scheduled activities.
Construction of networks
Step-1: Split the whole work content involved in the
project into small tasks called activities.
Step-2: Arrange the activities in a logical sequence
which can establish their interrelationship.
Step-3: Construct the network diagram by drawing
circles and arrows which represents events and
activities depending on the logical sequence.
Step-4: Number the events from starting node to till
the last event as per Fulkerson’s rule.
Guidelines (Rules) for Drawing Network Diagram
i. The network has only one start event and one end event.
ii. Each activity is represented by only one arrow in the network
and it should be shown from left towards right.
iii. Two activities can not be started by the same beginning
event and ended with same end event (Fig.1). In such cases, a
dummy activity is introduced as shown in Figure 2.
iv. Drawing an endless loop in a network diagram (known as
error of looping) is not allowed shown in Figure 3.
v. Avoid crossing the arrows and should be kept straight.
Fig. 1 Fig. 2 Fig. 3
Fulkerson’s Rule for numbering the Events
Step 1: First, a start event is one which has arrows emerging
from it but not entering it. Find the start event and mark it as 1.
Step 2: Delete all arrows emerging from all numbered events.
This will create at least one new start event out of the preceding
events.
Step 3: Number all new start events as 2, 3, and so on. No
definite rule for numbering, when there are more than one new
start event, but normally top event will be numbered first and
then towards down.
Step 4: Repeat step Nos. 2 & 3 until the end reached.
Ex.2: Draw the network diagram for the following project and
number the events:
i. Activities A and B starts simultaneously
ii. C follows A
iii. D follows A but precedes E
iv. F follows B and C but precedes G
v. G follows F and precedes H
vi. E follows D & H
vii. I follows F and H follows G
viii. E and I terminate at the same time.
Event time estimates
Earliest expected time of an event (TE): It is the earliest time at
which an event is expected to be occurred or completed.
It is computed by adding the expected time of an activities along an
activity path leading to that event.
If more than one activity path leading to that event, then the
maximum of the sum of te and TE among various paths will give TE.
TEj = TEj + teij
TEj = Max (TEj + teij)
TE4 = Max [(3+9), (4+3), (4+7)]
TE4 = Max (12, 7, 1) = 12
Latest allowable occurrence time (TL)
It is the latest time by which an event must occur to keep the
project on schedule.
Whenever a project is taken, decision is to be made regarding
the completion time of the project is called Scheduled
completion time or Contractual obligation time ( TS) of the
project. This TS is equal to TL of the last event
TLi = Min (TLj - teij)
TL1 = Min [(10-4), (12-8), (5-4)]
TL1 = 1
Critical Path
Critical Path is the Longest Path (time wise) in the
project network. It represents the Shortest Possible
Duration to accomplish the project.
It is identified by connecting the events having equal
and minimal slacks in the project network from
starting event to till the end event.
All the events lying along the critical path are called
critical events and their occurrences can not be
delayed if the project is to be completed in time as
per the schedule.
Slack: It is the difference between Latest allowable
occurrence time (TL) and Earliest expected time (TE) of an
event. S= TL - TE
Slack may be positive, zero or negative.
Positive slack indicates that, the work progress is ahead of
the schedule, may be do providing excess of resources or
due date fixed is larger than TE.
Zero slack is obtained when TL is equal to Te, indicates that
the project is progressing as per the schedule.
Negative slack is obtained when the scheduled time of
completion is less than TE, which indicates that, the project
progress is lagging (delayed than the scheduled), may be
due to the lack of resources.
Ex.1: Draw the arrow diagram for the following project comprises 7 activities.
Activity : 0-1 1-3 1-2 2-3 1-4 3-4 4-5
Duration: 3 16 6 8 10 5 3
The precedence relationship between various events is as shown below:
Event 0 is the initial event
Event 1 is preceded by event 0
Event 2 is preceded by event 1
Event 4 is preceded by event 1
Event 3 is preceded by event 1 & 2
Event 4 is preceded by event 3 & 1
Event 5 is preceded by event 1
