Project Management

with PERT/CPM

Project Management
Characteristics of Projects:
Unique, one-time operations
Involve a large number of activities that must be planned and coordinated
Long time-horizon
Goals of meeting completion deadlines and budgets

Examples:
Building a house
Planning a meeting
Introducing a new product

PERTProject Evaluation and Review Technique

CPMCritical Path Method
A graphical or network approach for planning and coordinating large-scale projects

Bahan Ajar Manajemen Proyek Teknik - Revisi 0 - Update 02 Februari 2010

Gantt Charts
A tool for planning and scheduling simple projects
Example: Building a House
ACTIVITY

TIME (DAYS)

PRECEDENCE

FOUNDATION

FRAMING

10

FOUNDATION

PLUMBING

FRAMING

ELECTRICAL

FRAMING

WALL BOARD

PLUMBING, ELECTRICAL

SIDING

16

FRAMING

PAINT INTERIOR

WALL BOARD

PAINT EXTERIOR

SIDING

FIXTURES

INT.PAINT, EXT.PAINT

Activity

Start

10

15

Start

10

15

Days After Start

20
25
30

35

40

45

50

35

40

45

50

Foundation
Framing
Plumbing
Electrical
Wall Board
Siding
Paint Interior
Paint Exterior
Fixtures
20
25
30
Days After Start

Bahan Ajar Manajemen Proyek Teknik - Revisi 0 - Update 02 Februari 2010

PERT and CPM

Procedure:
(i)

Determine the sequence of activities

(ii)

Construct the network or precedence diagram

(iii)

Starting from the left, compute the Early Start (ES)

and Early Finish (EF) time for each activity

(iv)

Starting from the right, compute the Late Finish (LF)

and Late Start (LS) time for each activity

(v)

Find the slack for each activity

(vi)

Identify the critical path

Notation:
t:

Duration of an activity

ES:

The earliest time an activity can start

EF:

The earliest time an activity can finish (EF = ES + t)

LS:

The latest time an activity can start and not delay the project

LF:

The latest time an activity can finish and not delay the project

Slack:

The extra time that could be made available to an

activity without delaying the project (Slack = LS - ES = LF - EF)

Critical Path :

The sequence of activities with no slack

Bahan Ajar Manajemen Proyek Teknik - Revisi 0 - Update 02 Februari 2010

PERT/CPM Example Building a House

9
Plumbing c
0
START

4
a
Foundation

10
b
Framing

6
d
Electrical
16
f
Siding

8
e
Wall
Board

5
g
Paint
Interior

6
i
Fixtures

0
FINISH

9
h
Paint Exterior

PERT/CPM Example Building a House

Calculation of ES, EF, LF, LS, and Slack:
ACTIVITY
FOUNDATION
FRAMING

SLACK

ES = Maximum of EFs for incoming arrows

EF = ES + t
LF = Minimum of LSs for leaving arrows
LS = LF - t
Slack = LS - ES = LF - EF

PLUMBING
ELECTRICAL
WALL BOARD
SIDING
PAINT INTERIOR
PAINT EXTERIOR
FIXTURES

Bahan Ajar Manajemen Proyek Teknik - Revisi 0 - Update 02 Februari 2010

PERT/CPM Example #2
Activity
a
b
c
d
e
f
g
h
i
j

Slack

8
e

4
a

4
d

5
g

5
i

0
START

0
FINISH
4
b

3
c

3
h

5
j

7
f

Drawing a Project Network Example

Activity
a
b
c
d
e
f
g

Precedes
End
a
b, d
e
End
d, g
e

Bahan Ajar Manajemen Proyek Teknik - Revisi 0 - Update 02 Februari 2010

Drawing a Project Network Example

Activity
a
b
c
d
e
f
g

Immediate
Predecessors
b
c
Start
c, f
d, g
Start
f

Time-Cost Tradeoffs

Bahan Ajar Manajemen Proyek Teknik - Revisi 0 - Update 02 Februari 2010

PERT/CPM with Crashing

It is often possible to expedite activities at extra cost (called
crashing).
Benefits of completing a project earlier:
Monetary incentives for timely or early completion of project
Beating the competition to the market
Reduce indirect costs
Procedure:
(1)
Obtain estimates of regular and crash times and costs for each
activity.
(2)

Determine the lengths of all paths using regular time for each
activity.

(3)

Identify the critical path(s).

(4)

Crash activities on the critical path(s) in order of increasing cost as

long as crashing costs do not exceed benefits.

The indirect costs for this project are $1000 per day
Activity
Foundation
Framing
Plumbing
Electrical
Siding
Wall Board
Paint Interior
Paint Exterior
Fixtures

Normal Crash Cost per day

Time Time
to crash
4
4

10
8
$400
9
7
$200
6
4
$200
16
12
$300
8
6
$600
5
2
$900
9
7
$700
6
3
$1,200

Bahan Ajar Manajemen Proyek Teknik - Revisi 0 - Update 02 Februari 2010

Example: Building a House

Crash Activity Crash Cost Path 1

Length
Path 2 Path 3

Designing with Uncertain

Activity Durations

Bahan Ajar Manajemen Proyek Teknik - Revisi 0 - Update 02 Februari 2010

PERT with Probabilistic Time Estimates

If the activity times are not known with certainty, PERT/CPM can be extended to
consider probabilistic time estimates.

For each activity, make three time estimates:

Optimistic time:

to

Pessimistic time: tp
Most likely time: tm
Assumption:
The variability of the time estimates follows the beta distribution:

to

tm

tp

Tim e

PERT/CPM with Probabilistic Time Estimates

Goal:
Calculate the probability that the project is completed by time t

Procedure:
1. Calculate the expected completion time and standard deviation for each
activity.

2. Calculate the expected completion time and standard deviation for each
path.

3. Find the probability that each path completes by time t.

4. Find the probability that all paths (and thus the project) completes by
time t.

Bahan Ajar Manajemen Proyek Teknik - Revisi 0 - Update 02 Februari 2010

Expected Time and Standard Deviation for

Activities (Step #1)

to

tm

te

tp

Tim e

The expected time for each activity can be calculated as follows:

te =

to + 4tm + t p
6

The standard deviation for each activity can be calculated as follows:

t p to
=
6

Expected Time and Standard Deviation for Paths

(Step #2)

0
START

t e,

te,

te,

0
FINISH

Path 1:

a-b-d

Path 2:

a-c-e

t e,

te,

For each path, the expected time and variance are

so

tpath = sum of te for the activities on the path

2path = sum of 2 for the activities on the path
path = 2path

Bahan Ajar Manajemen Proyek Teknik - Revisi 0 - Update 02 Februari 2010

10

Probability Path Completes by Time t (Step #3)

Probability
Density
Function

t path

+2

+3

Path duration

What is the probability that this path has duration t?

z=

t tpath

path

Use Normal Tables

Probability Project Completes by Time t (Step #4)

0
START

te,

te,

te,

0
FINISH

te,

te,

An approximation:
Probability (Project t) = Prob (Path 1 t) Prob (Path 2 t)

Bahan Ajar Manajemen Proyek Teknik - Revisi 0 - Update 02 Februari 2010

11

Example
3-4-6
d

2-4-5
b
2-3-4
a

0
START

0
FINISH
1-3-7
c

2-3-8
e

What is the probability that the project will be finished by day 12?
What is the probability the project wont be finished by day 13?

Step #1 (Expected Time and Standard Deviation for

Activities)
te =

to + 4tm + t p

Activity

to

tm

tp

6
3.00

t p to

6
0.33

0.11

3.83

0.50

0.25

3.33

1.00

1.00

4.17

0.50

0.25

3.67

1.00

1.00

Bahan Ajar Manajemen Proyek Teknik - Revisi 0 - Update 02 Februari 2010

12

Step #2 (Expected Time and Standard Deviation

for Paths)
Path

tpath =

te

2
path
=

activities
on path

2

activities
on path

path

a-b-d

11.00

0.61

0.78

a-c-e

10.00

2.11

1.45

Path

tpath =

te
activities
on path

2
path
=

2

activities
on path

path

a-b-d

11.00

0.61

0.78

a-c-e

10.00

2.11

1.45

What is the probability that the project will be finished by day 12?

Step #3 (Probability Each Path 12)

Bahan Ajar Manajemen Proyek Teknik - Revisi 0 - Update 02 Februari 2010

13

Step #4 (Probability Project 12)

Example continued

Path

tpath =

te
activities
on path

2
path
=

2

activities
on path

path

a-b-d

11.00

0.61

0.78

a-c-e

10.00

2.11

1.45

What is the probability the project wont be finished by day 13?

Step #3

Step #4

Bahan Ajar Manajemen Proyek Teknik - Revisi 0 - Update 02 Februari 2010

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