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PERT and CPM

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PERT and CPM

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aleeshatp909
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© © All Rights Reserved
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10.

Conceptual question 10.04– 10.05


Network construction 10.06– 10.10
Slack and Floats 10.11– 10.12
Standard deviation and variance 10.13 - 10.13
PERT 10.14– 10.14
Time scaled diagram 10.15 -10.15
Crashing
10.16 -10.19
1. BOOST IMMUNITY SYSTEM 2. WASH YOUR HAND FREQUENTLY AND
CAREFULLY.

3. TAKE BATH AFTER REACHING HOME IF 4. AVOID TOUCHING YOUR FACE


YOU WENT OUTSIDE.

5. DO NAMSKAR AND STOP SHAKING 6. DON’T SHARE PERSONAL ITEMS


HANDS AND HUGGING PEOPLE.

7. AVOID EATING OR DRINKING IN PUBLIC 8. COVER YOUR MOUTH AND NOSE WHEN YOU
PLACES COUGH AND SNEEZE

9. CLEAN AND DISINFECT SURFACES 10. TAKE SOCIAL DISTANCING SERIOUSLY

11. DO NOT GATHER IN GROUPS 12. WASH FRESH GROCERIES

13. WEAR A (HOMEMADE) MASK 14. SELF-QUARANTINE IF SICK


GILOY, NEEM, TULSI AND YOGA AMLA IN ANY FORM
OTHER AYURVEDIC
BEVERAGE

EXERCISE OR ANY SPORT GREEN VEGETABLES HOMEMADE FOOD

JAGGERY (GUD) ANY PURE OIL (EXCEPT FRUITS (ESPECIALLY CITRUS)


REFINED)

MILK, CURD, LASSI, GHEE PULSES


ETC.

FLOUR (THE MOST DESTRUCTIVE SUGAR, JUNK FOOD


SUBSTANCE LIKE BREAD, NAN,
BHATURE, BURGER, PIZZA, JALEBI,
SAMOSA, KACHAURI, PAAV),
PERT AND CPM
THEORY
1. CRITICAL PATH: [2009(M)] (2 Marks)
 A network path consists of a set of activities that connects the network beginning event to
the network terminal event.
 The longest path is the critical path because it equals the minimum time required to
complete the project.
 All other paths other than the critical path offer flexibility in scheduling and transferring
resources, because they take less time to complete than the critical path.

2. BASIC STEPS INVOLVED IN DRAWING OF A CPM/PERT NETWORK:


Network is a diagram representing the activities and events of a project, their sequence and
inter-relationship:
The basic steps are involved in drawing a network are:
(i) Breaking up to the entire project into smaller systems known as tasks.
(ii) For each task ascertain the activities and events to be performed.
(iii) For each activity determine the preceding and succeeding activity.
(iv) For each activity determine or estimates the time and other resources needed.
(v) Draw a network depicting the assembly of tasks into a project.

3. STEPS INVOLVED IN THE CRITICAL PATH ANALYSIS :


[2010(N)] (4 Marks)
(i) Analyse and break down the project in terms
of specific activities and/or events.
(ii) Determine the interdependence and sequence
of specific activities and prepared a network.
(iii) Assign estimates of time, cost or both to all
the activities of the network.
(iv) Identify the longest or critical path through the
network.
(v) Monitor, evaluate and control the progress of
the project by re-planning, rescheduling and
reassignment of resources.

10. | 1
4. DUMMY ACTIVITY [2008(M), 2009(M)] (4 Marks)

It is an imaginary activity which consumes no resource and time. It is represented by dotted


lines and is inserted in the network under the following situations:
(i) It is created to make activities with common starting and finishing events
distinguishable.
(ii) To identify and maintain the proper precedence relationship between activities that is
not connected by events.
(iii) To bring all "loose ends" to a single initial and a single terminal event in each network
using dummies, if necessary.

5. FRAMEWORK OF PERT/CPM: [2001(N)] (5 Marks)


 The PERT and CPM models are extremely useful for the purpose of planning, scheduling
and controlling the progress.
 It is also useful in completion of large and complex projects or for carrying out the
analysis of these three managerial functions.
 PERT and CPM were developed during 1950s and are also the network
techniques/models.
 A network is a graphical representation of a project, depicting the flow as well as the
sequence of well-defined activities and events.
 Both CPM (Critical Path Method) and PERT (Programme Evaluation and Review
Technique) are network techniques/ models.

6. DISTINCTION BETWEEN PERT AND CPM:


[1998(M), 2000(N), 2010(N)] (7 Marks)

PERT CPM
It is event oriented as the result of analysis It is activity oriented as the result of the analysis
is expressed in terms of events of the is expressed in terms of activities or operations
project. of the project.
It is probabilistic model with uncertainty in It is a deterministic model with well known
activity duration. activity times based on past experience.
It is used for new projects where time It is used for projects of repetitive nature or
required is not known. projects in which one has prior experience.
It is emphasizes on time. It emphasizes on both time and cost.

10. | 2
7. LIMITATION OF THE ASSUMPTION OF PERT/CPM: [2011(N)] (5 Marks)
(a) Beta distribution may not always be applicable.
(b) The formula for expected duration and standard duration are simplification certain
cases, errors due to these have been found upto 33%.
(c) The above error may get compounded or may cancel each other.
(d) Activities are assumed to be independent. But the limitation on the resources may not
justify the assumption.
(e) It may not always be possible to sort out completely identifiable activities and state
where they begin and where they end.
(f) It there exist alternatives in outcome, they need to be incorporated by way of a decision
tree analysis.
(g) Time estimates have a subjective element and to this extent, techniques could be weak.
(h) Cost-time tradeoff/cost curve slopes are subjective and even experts may be widely off
the mark even after honest deliberations.

8. TYPES OF TIMES ESTIMATES: [Imp]


1) The Optimistic Time Estimate: This is the estimate of the shortest possible time in
which an activity can be completed under ideal conditions. For this estimate, no
provisions for delays or setbacks are made. It is denoted by to.
2) The Pessimistic Time Estimate: This is the maximum possible time which an activity
could take to accomplish the job. If everything went wrong and abnormal situations
prevailed, this would be the time estimate. It is denoted by tp.
3) The Most Likely Time Estimate: This is a time estimate of an activity which lies
between the optimistic and the pessimistic time estimates. It is denoted by tm.

9. RESOURCE SMOOTHING: [1999(M), 2002(M), 2002(N), 2005(M)] (2 Marks)

 It is a network technique used for smoothening


peak resource requirement during different
periods of the project network.
 Under this technique the total profit duration is
maintained at the minimum level.
 The resources required for completing different
activities of profit are smoothened by utilising
floats available on non-critical activities.
 These non-critical activities having floats are
rescheduled or shifted so that a uniform
demand on resources is achieved.
 The constraint is on the profit duration time.

10. | 3
10. RESOURCE LEVELING: [2000(M), 2002(M), 2002(N), 2005(M)] (2 Marks)

 It is also a network technique used for reducing the requirement of particular resource
due to its paucity.
 It utilizes the large floats available on non-critical activities of the project and thus
cuts down the demand on the resources.
 In resource leveling, the maximum demand of a resource should not exceed the
available limit at any point of time.
 To achieve this, non-critical activities are rescheduled by utilising their floats.
 It may lead to enlarging the completion time of the project.
 The constraint here is on the limit of the resource availability.

11. PROJECT CRASHING [IMP]


 It means reduction in project duration.
 Reduction in duration involves application of additional resources which involves
additional cost and at the same time reduction in indirect cost per day.
 We identify the activities which can be crashed and compare the activity cost slope with
indirect cost per day so as to arrive at project duration at optimum cost.
 Activity cost slope = (Crash cost – Normal Cost) / (Normal time – Crash time)
Notes:

10. | 4
PRACTICAL
CASE STUDY

1 State the validity of following statements along with the reasons:


(i) Two activities have common predecessor and successor activities. So they can have
common initial and final nodes.
(ii) In respect of any activity whether real or dummy, the terminal node should bear a
number higher than the initial node number.
(iii) The difference between the latest event time and the earliest event time is termed as
free float.
(iv) For every critical in a network, the earliest start and the earliest finish time as well as
the latest finish time and the latest start time are the same.
(v) The optimal duration of a project is the minimum time in which it can be completed.
(vi) Resource leveling aims at smoothening of the resource usage rate without changing
the project duration.
{Ans:} RPM

2. Write short notes on:


(i) Merge Event
(ii) Burst Event
(iii) Looping
(iv) Dangling
(v) Duplicate or parallel activities
(vi) Redundancy
(vii) Interfering Float
(viii) Independent Float
(ix) Slack Time for an Event

3. The following is a part of a network.

P
S

Q
R

What are activities P and Q called? How would you rectify the situation? NPM

10. | 5
4. Point out the errors in the network given below, going by the usual conventions while drawing a
network to use CPM

1 2 3 4
6
5
8

{NPM}

NETWORK CONSTRUCTION

5. Given the following information, develop a network


Activity Preceding Activity
A -
B -
C A
D B

6. Draw the network for following project:


Activity immediately Predecessor
F -
G -
H F
I F
J G, H

10. | 6
7. Draw the network for following project:
Starting Event Terminal Event Activity
1 2 1-2
1 3 1-3
2 4 2-4
3 4 3-4
3 5 3-5
4 6 4-6
5 6 5-6

8. Develop a network from given data:


Activity Immediately predecessor
A -
B -
C -
D A
E B
F C
G D&E
H F&G

9. Draw Network from following project:


Activity Time Activity Time
1-2 4 5-6 4
1-3 1 5-7 8
2-4 1 6-8 1
3-4 1 7-8 2
3-5 6 8-10 5
4-9 5 9-10 7

10. | 7
10 Draw the network for the following project
Activity Preceding Activity
A -
B A
C A
D A
E B
F B
G E
H F
I G,H
J C
K D
L I,J,K

11. Activity Preceding Activity


A -
B -
C A
D B,C
E B
The project is finished when both D and E are complete.

12. Activity Preceding Activity Duration weeks


A - 5
B - 4
C A 2
D B 1
E B 5
F B 5
G C, D 4
H F 3
I F 2

10. | 8
a) What are the paths though the network?
b) What is the critical path and what is its duration?

13. Draw a network diagram for the following data.


Task Immediate predecessor
A _
B _
C B
D B
E B
F E
G A, D, C
[S.M.]

14. Draw a network diagram for the following data.


Activity Preceding activities
A _
B A
C A
D B
E A
F B, E
G C
H D, F
I G
J H, I
[S.M.]

“Man cannot discover new oceans unless he has the courage to lose sight of the
shore.”

10. | 9
15. The following information is known for a project. Draw the network and find the critical path.
This must be completed Before this can start
A (14) B, E, J
B (28) C
C (20) D
D (14), E (42) F, G, K
F (14), G (24) I (30)
J (60) K (30)
Note:
Capital letter denotes activities.
Numbers in bracket denote activity times. [PM]

16. A company had planned its operations as follows:


Activity Duration (days)
1-2 7
2-4 8
1-3 8
3-4 6
1-4 6
2-5 16
4-7 19
3-6 24
5-7 9
6-8 7
7-8 8

(i) Draw the network and find the critical paths.


(ii) After 15 days of working, the following progress is noted:
(a) Activities 1-2, 1-3 and 1-4 completed as per original schedule.
(b) Activity 2-4 is in progress and will be completed in 4 more days.
(c) Activity 3-6 is in progress and will need 17 more days to complete.
(d) The staff at activity 3-6 is specilised. They are directed to complete 3-6 and
undertake an activity 6-7, which will require 7days. This rearrangement arose due

10. | 10
to a modification in a specialization.
(e) Activity 6-8 will be completed in 4 days instead of the originally planned 7 days.
(f) There is no a change in the other activities.
Update the network diagram after 15 days of start of work based on the assumption given above.
Indicate the revised critical paths along with their duration.
[P.M.] {Answer: 42 days, 47 days}

17. After 15 days of working the following progress is noted for the network of an erection job:

(i) Activity 1-2, 1-3, and 1-4 competed as per original schedule.
(ii) Activity 2-4 is in progress and will be complete in 3 more days.
(iii) Activity 3-6 is in progress and will need 18 days more for completion.
(iv) Activity 6-7 appears to present some problem and its new estimated time of completion is
12 days.
(v) Activity 6-8 can be completed in 5 days instead of originally planned for 7 days.

You are required to:

(i) Update the above diagram after 15 days of the start of work based on the assumption
given above.
(ii) Write down the critical path with total project duration.

[2016(M)] (8 Marks) {Ans: 51 days}

18
2 5
9
8
7
6
1 20
4
7

10 5 11 7 6

3
6 8
9 7

10. | 11
SLACK AND FLOAT

18. A small assembly plant assembles PCs through 9 interlinked stages according to following precedence /
process:
Stage from to Duration
1-2 4
1-3 12
1-4 10
2-4 8
2-5 6
3-6 8
4-6 10
5-7 10
6-7 0
6-8 8
7-8 10
8-9 6
(i) Draw an arrow diagram (network) representing the above assembly work.
(ii) Tabulate earliest start, earliest finish, latest start and latest finish time for all the stages.
(iii) Find the critical path and the assembly duration.
(iv) Tabulate total float, free float and independent float. [S.M.]

19. The number of days of total float (TF), earliest start times (EST) and duration in days given for some of
the following activities.
Activity TF EST Duration
1-2 0 0 ???
1-3 2 ??? ???
1-4 5 ??? ???
2-4 0 4 ???
2-5 1 ??? 5
3-6 2 12 ???
4-6 0 12 ???
5-7 1 ??? ???
6-7 ??? 23 ???
6-8 2 ??? ???
7-8 0 23 ???
8-9 ??? 30 6

10. | 12
(i) Find ??? figure
(ii) Draw the network.
(iii) List the paths with their corresponding durations and state when the project can be completed.
[2011(N)] (10 Marks)[RTP-2014(N)] [Ans: 36 Days]

20. For the following project network:

3 16

7 3 6
18 8
10
1 2 6 7
11
4
8 5 11

10 9
4

Required
(i) Calculate the each activity, its early start time, early finish time, late start time, late
finish time, total float, free float and independent float.
(ii) Identify the critical path.
(iii) If the project manager finds that either of the activities 2-6 or 4-5 can each be speeded
up by two days at the same cost, which of the two activities should be speeded
up?Explain.
[PM] {Ans:- 35 days, 33 days}

“entrepreneurs don’t waste tiMe/energy worrying about being better


than someone else. Focus on being the very best version of you.”

10. | 13
21. The following table gives the activities in a construction project and the time duration of each
activity:

Activity Predecessors Normal Time (Days)

A ---- 16
B ---- 20
C A 8
D A 10
E B, C 6
F D, E 12
Required
(i) Draw the activity network of the project.
(ii) Fine critical path.
(iii) Find the total float and free-float for each activity.
RTP

STANDARD DEVIATION AND VARIANCE

22. If the critical path of a project is 20 months along with a standard duration of 4 months, what is
the probability that the project will be completed within:
(a) 20 months (b) 18 months (c) 24 months?
{Ans:} [S.M]

23. PERT calculations yield a project length of 60 weeks with variance of 9. Within how many
weeks would you expect the project to be completed with probability of 0.99? (That is the project
length that you would expect to be exceeded only by 1% of the times if the project were repeated
many times is an identical manner).
{Ans:} [S.M]

10. | 14
24. A small project is composed of 7 activities whose time estimates are listed in the table below.
Activities are identified by their beginning (i) and ending (j) node numbers.
a) Draw the project network and identify all the paths through it.
b) Find the expected duration and variance for each activity. What is the expected project
length?
c) Calculate the variance and standard deviation of project length. What is the probability that
the project will be completed :
(i) at least 3 weeks earlier than expected ?
(ii) no more than 3 weeks later than expected ?
d) If the project due date is 18 weeks, what is the probability of not meeting the due date?
e) What due date has about 90% chance of being met?
Activity Estimated duration in Weeks
i-j Optimistic Most Likely Pessimistic
1-2 1 1 7
1-3 1 4 7
1-4 2 2 8
2-5 1 1 1
3-5 2 5 14
4-6 2 5 8
5-6 3 6 15
[S.M] {Ans: 17, 0.159, 0.841, 0.33, 0.37, 20.9}

25. A small project consisting of eight activities has the following characteristics:

Activity Time (Weeks)


Optimistic Pessimistic Most Likely
1–2 4 12 8
1–3 3 5 4
1–4 4 8 6
2–5 4 6 5
3–5 3 3 3
4–6 7 11 9
5–6 6 12 9
5–7 5 9 7
6–7 3 5 4

10. | 15
Required:
(i) Draw the project network and find out the critical path and expected completion time.
(ii) Calculate the standard deviation and variance of the project.
(iii) What is the probability of the project completion at least 2 weeks, what is the
probability of not meeting the due date?
(iv) if the project due date for completion is 27 weeks, what is the probability of not
meeting the due date?
(v) If the project manager wants to be 90% sure of the completion, how many weeks
before the due date should he commence the project?
Value of Z1.155 = 0.3759, Z0.58 = 0.2190, NT (Z)0.40 = 1.28

2017 (N)10 marks

PERT
26. A project consists of seven activities whose time estimates (optimistic – to, Pessimistic – tp and
most likely - tm) in days are given below :
Activity to tp tm
1-2 1 5 3
1-3 1 7 4
1-4 2 10 6
2-5 2 8 2
3-5 3 15 6
4-6 2 8 5
5-6 2 14 5
Required:
(i) Draw the network and find out the expected time and variance for each activity. What
is the expected duration for completion of the project?
(ii) If the target time is 22 days, what is the probability of not meeting the target?
(iii) Within how many days can the project be expected to be completed with 99 percent
chance?
2013(N) (8 Marks) Given Z2.33 = 0.9901 and Z1.67 = 0.9525

10. | 16
TIME SCALE DIAGRAM

27. A small project consists of seven activities for which the relevant data are given below:
Activity Preceding Activity Activities Duration (Days)
A - 4
B - 7
C - 6
D A,B 5
E A,B 7
F C,D,E 6
G C,D,E 5
(i) Draw the network and find the project completion time.
(ii) Calculate total float for each of the activities.
(iii) Draw the time scaled diagram.
[NSM] Ans: 20 days

28. The following information is available


Activity No. of Days No. of men required per day
A 4 2
(1-2)
B 2 3
(1-3)
C 8 5
(1-4)
D 6 3
(2-6)
E 4 2
(3-5)
F 1 3
(5-6)
G 1 7
(4-6)
Required:
(i) Draw the network and find the critical path.
(ii) Find out the different type of float associated with each activity.
(iii) Prepare time scaled diagram
(iv) What is peak requirement of manpower? On which day(s) will this occur?
(v) If the maximum labour available on any day is only 10, when can the project be
completed? NPM - Ans: 10 days, 7th day,

10. | 17
CRASHING

29. The following network gives the duration in days for each activity:

2 8

1 3 3 7 5 5 6

4 1
4 6

(i) You are required to list the critical paths.


(ii) Given that each activity can be crashed by a maximum of one day, choose to crash
any four activities so that the project duration is reduced by 2 days.

{Ans:} [P.M]

30. A network is given below:

2 5 5 3

2 8
5 5

1 6
2 9
1 2
3

3 4 7
2 3

Duration in weeks

10. | 18
(i) Name the paths and given their total duration.
(ii) Give three different ways of reduction the project above duration by four days
[PM 14.19] {Ans: 15 weeks}

31. The following network and table are presented to you:


X
4
5
W Y
1 6

V
T 2 3
U

Activit Normal Duration Normal Cost Crash Duration Crash Cost


y (Days) (Rs.) (Days) (Rs.)
T 8 2,250 6 2,750
U 16 1,875 11 2,750
V 14 2,250 9 3,000
W 12 3,000 9 3,750
X 15 1,000 14 2,500
Y 10 2,500 8 2,860
Perform step by step crashing and reduce the project duration by 11 days while minimize the
crashing cost. What would be the cost of the crashing exercise?
[2012(M)] (8 Marks) {Ans: ₹ 1805}

10. | 19
32. The following information is given for a certain project:

Activit Normal Crash Difference Normal Crash Difference Activity


y Duration Duration Cost Cost slope
(Days) (Days) (Days) (₹) (₹) (₹) (₹/days)
I II III=I-II IV V VI=V-IV VII=VI/III
1-2 9 6 3 640 700 60 20
1-3 8 5 3 500 575 75 25
1-4 15 10 5 400 550 150 30
2-4 5 3 2 100 120 20 10
3-4 10 6 4 200 260 60 15
4-5 2 1 1 100 140 40 40

(1) What is normal project duration?


(2) Perform step-by-step crashing to reduce the project duration by 5 days. What is the cost
incurred for the optimal crashing exercise?
(3) Independent of (ii) above, if the Project Manager is able to save as per rates in Column
VII of the above table for every day relaxed for the activities, compute the number of
days and associated savings for 5 days of relaxation, in the order of optimality, without
extending in this exercise to schedule resources.
NPM Ans: 20 days, ₹ 130

33. The normal time, crash time and crashing cost per day are given for the following network:

4 5
1

10. | 20
Activity Normal Time Crash Time (Days) Crashing Cost
(Days) (₹/Day)
1–2 18 14 40
1–3 23 22 20
2–3 8 5 60
2–4 10 6 40
3–4 3 2 80
4–5 8 6 50

(i) Crash the project duration in steps and arrive at the minimum duration. What will be
critical path and the cost of crashing?
(ii) If there is an indirect cost of ₹ 70 per day, what will be optimal project duration and
the cost of crashing?
{Ans: - ₹ 360, ₹ 280} [PM: 14.59]

34. A project with normal duration and cost along with crash duration and cost for each for each
activity is given below:
Activity Normal Time Normal Cost Crash Time Crashing Cost
(Hrs.) (₹) (Hrs.) (₹)
1–2 5 200 4 300
2–3 5 30 5 30
2–4 9 320 7 480
2–5 12 620 10 710
3–5 6 150 5 200
4–5 0 0 0 0
5–6 8 220 6 310
6–7 6 300 5 370
There is an Indirect Cost of ₹ 50 per Hour.

Required
(i) Draw network diagram and identify the critical path.
(ii) Find out total float associated with each activity.
(iii) Crash the relevant activities systematically and determine the optimum project
completion time and corresponding cost.
PM Ans:- 1 – 2 – 5 – 6 – 7, 31 Hours, ₹ 3,375}

10. | 21
35. The following table shows for each activity needed to complete the road construction project,
the normal time, the shortest time in which the activity can be completed and cost per day for
reducing the time of each activity. The contract includes a penalty clause of ₹ 80 per day over
19 days. The overhead cost is ₹ 150 per day. The cost of completion the eight activities in
normal time is ₹ 6,000.

Activity Normal time in days Shortest time in days Cost of reduction


per day (₹)
1-2 7 5 90
1-3 9 5 100
1-4 7 4 40
2-4 4 4 -
2-5 6 4 50
3-6 13 9 210
4-6 8 5 60
5–6 6 6 -
Required:

(i) Draw the network diagram for the project and identify the critical path and show
normal duration and minimum duration of different paths.
(ii) Calculate the total cost associated to normal duration of the project.
(iii) Crash the relevant activities systematically and determine the lowest cost and
associated time.
2016(N) Ans: ₹ 9,540, ₹ 9,150

36. (a) The following information on activities, the Earliest Start Time (EST), Latest Start Time
(LST), Earliest Finish Time (EFT) in days is given for certain project:
Activity EST LST EFT Crashing Cost ₹/day
A 0 0 5 1000
B 0 6 6 2000
C 5 8 9 3000
D 5 7 8 4000
E 5 5 6 5000
F 6 6 10 6000
G 10 10 24 7000
H 9 12 21 8000
I 24 24 26 9000
Given that: G is immediately preceded by F and D.

10. | 22
B’s successor is H and H’s successor is I. it is not possible to have a zero duration activity.
(i) What is the project completion time?
(ii) Find the LFT (Latest Finish Times) of activities C, D, H and B.
(iii) Reduce the project duration by three days, by performing step by step crashing cost
assuming that no activity can be crashed by more than one day.
(iv) After crashing exercise, if activity H’s duration is increased by one day, by how many
days can you increase the duration of each of the activities B and C without delaying
the project beyond its crashed duration? Explain the underlying concept.
(v) (You are not expected to present the network diagram).

(You may opt the following format for your answer).

Sl. No.
(i) Duration =
(ii) LFT:
C:
D:
H:
B:

(iii) Step Crash Activity Days Cost (₹)


I
II
III
(iv) Activity Increase duration by (days)

B
C
2017(M) 10 Marks

“Life isn’t about learning how to weather the storm. It’s about learning how to dance in the rain.”

10. | 23
 CA FINAL
 SCM & PE / AMA

FACE 2 FACE

|| PENDRIVE || ||GOOGLE DRIVE ||


UPDATED STUDY MATERIAL AND UPDATE LECTURES

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