Reflection: A comparison between CPM and PERT from the functionality and commercial software point o

Introduction

This reflection intents to approach two closely related project management techniques: PERT (that stands for Program Evaluation and Review Techniques) and CPM (that stands for Critical Path Method). Both techniques were developed in the 1950s however under two different contexts and for completely different reasons.

CPM was formulated as a tool of planning and control of DuPont engineering projects, meanwhile PERT was developed to be used as part of the production and management of the Polaris missile.

These techniques share some common objectives that include defining the total duration of the project and finding the critical activities. They can be seen as a forward propagation of activities that define the early finish/start and late start/finish dates taking into consideration the free floats and the total floats, however some critics see CPM as a static time technique, and meanwhile PERT is a probabilistic version of it. (Al Samman, Al Brahen 2014)

The ultimate goal of doing this, is to build a time schedule to keep track on the activities. Some calculations need to be run to estimate the total time required to complete the project and also classify the project activities as critical and non-critical. A non-critical activity allows the scheduler to delay it by a certain amount of time, without effecting the length of the project. This requires to follow some steps that include 1. Describing the project. 2. Drawing the network 3. Estimating time and 4. Monitoring the progress. ( Lermen, Morais, Matos, Roder, Roder 2016)

In the reflection, it will be discussed some challenges and advantages of using these two techniques, as well as the usage of some project management software. It will be also consider some case studies that include the applicability of these techniques in some industrial processes that show the applicability and limitation of these techniques and their results in terms of increase of productivity.

Background

Since the 50s, when PERT was formulated, many scientists have tried to define a theoretical foundation. It is now accepted that PERT is a good management tool to schedule, organise and coordinate tasks within a project. (Arunava, Anand 2007). The Navy’s special projects office was in charge of developing a Polaris Submarine weapon system and a fleet ballistic missile. The objective was to develop a technique capable of measuring and forecasting its progress. The tool was used for decision making and took into consideration three crucial factors in project management: time, resources and performance specifications.

The technique forecasts uncertainties by using “most likely time that the project could “require”, “optimistic” and “pessimistic” for each activity. PERT is “a critical path method of estimating project competition time and its probabilistic version” (Arunava, Anand 2007).

CPM was formulated in the late 50s by Morgan R. Walker and James E. Kelley Jr. This new development “Critical Path” did eventually contribute to the success of the Manhattan Project that involved nuclear weapons during the World War II. It has been since then applied to projects from the construction, research, software industry and others.

Rationale for using the technique

Some considerations when applying these techniques are:

• They act as a basis for both preparation of a consistent schedule, allowing project managers monitor the achievements of goals. In the case of PERT shows the probability of completing the project within different deadlines.

• They have been widely used in different industries by project managers from different levels of expertise as CPM for example is available in MS Project which is one of the products developed by Microsoft. For example, within a project, it will likely that the project manager may want to display the final project by using Gantt Chart as it is a very friendly way to see the progress of the project. However this is acceptable when the complexity of the project is low or medium. For a project of more than 150 activities, it can become overwhelming. (Al Samman, Al Brahen 2014)

• It allows project managers to play with the scheduling of the activities. In some circumstances, users of these techniques have preferred to build the PERT chart from back to front, because in many cases, the end date is fixed and the contractor has “front-end flexibility”( Punmia, Khandelwal 2006)

• The time estimated by different managers of a project may involve different degrees of certainty. When these estimations can be done with a high degree of certainty, they are often called deterministic estimations (CPM). When these estimations become variables, then they have a probabilistic approach (PERT). Managers often offer three estimates: an optimistic, pessimistic and most likely. Some statistical calculations can be apply to analyse the extent of variability of these estimate.

Advantages

Both PERT and CPM allow to determinate critical information such as: Length of the project, risks involved (when defining certainties and critical activities), and slack of each activity .This information is vital for project manages. Schedule and the costs are key concerns and method of time-cost and method of time-cost trade-offs allows finding ways of minimising the duration of the project. ( Lermen, Morais, Matos, Roder, Roder 2016) and finally finding the critical path helps make decisions regarding resource allocation by knowing for example how long the project can be delayed.

Both PERT and CPM have been broadly used for scheduling and also defining the project feasibility in terms of cost and time. These project management techniques are applicable to a broad range of industries.

Based on the results of a survey held by one of the biggest international organisation of project managers in the world that intended to analyse different usage patterns within different Project Management software. CPM was found as one of the most common techniques for project managers from the construction industry for planning and control. Around 89% of the respondents of the survey chose CPM as a planning tool meanwhile 72% selected this technique as a way to control the project. A lower percentage used another techniques such as earned value for control. (Winter, Evrenosoglu 2011).

There was also found that there is no significant relationship between years of experience and type of technique used in PM, meaning that users with different levels of proficiency in project management can find these tools very applicable.

CPM and PERT can complement each other. As PERT is a variation on the Critical Path Analysis, it takes a more “sceptical” view of time estimates for each phase. It will be up to the managers to define the uncertainties or certainties in terms of time in the project.

Disadvantages

It has been found that project managers from the construction industry tent to use more than one technique. It makes sense as CPM and PERT lack of some analysis such as the earned value that helps assess the project at any point in terms of resources usages, time and cots. (Winter, Evrenosoglu 2011)

Some research suggest that a slack allocation problem occurs when allocating existing extra time in some paths in the activities belonging to them. However new developments suggest that a different approach can be taken. It could be to assign extra time to activities proportionally to their durations in a way that no path duration exceeds the competition of the whole process. (Castro, Gomez, Tejada 2007)

As the nature of the projects change over the years, becoming more diversify there have been doubts if the traditional project planning methods are effective in different industry. There is been also identified some issues within projects with high amounts of projects. Some project managers have said that ‘the only way we hit targets is if we continuously “adjust” the baseline.’ (Maylor 2002)

There is a controversy whether PERT is a tool with a broad range of applications including industrial processes or as Maylor (2002) affirms that these models have been refined over the years, however they have limitations when being applied to a large number of world-class organisations that manage large quantities of activities with very complex interrelationships.

PERT does not consider the resources over allocation between activities and this can be conflicting when managing large amounts of staff, machinery and others (Maylor 2002). In a real situation there will be always necessary to allocate resources and make sure that they are not doubling up.

Drivers and barriers

In this section, it will be approached what the main drivers and barriers are for users to choose from one MS project software available in the market to the other. t will be analysed two main project management software.

MS Project

MS Project that was developed in 1984. It was designed to assist project managers in developing baseline plans that allowed managers allocate resources, tracking the progress of activates, managing budgets and workloads. One of its most important features is the critical path that can be visualised in a Gantt chart. It can also assign different types of interdependencies within activates.

Primavera

Primavera is the second software to analysis .It was developed to help project-intensive organisations identify, prioritise and plan, manage and control projects. Most of its users are from the heavy construction industry. This project is been classified as more complex and professional. (Winter 2013)

Usage comparison

The Critical Path Method CPM, is one the techniques available in commercial software for users to schedule, plan and control projects. However some differences between its features and characteristics can determine a user chooses to apply or the other. For example, MS Project is less expensive, it is user friendly and it comes installed as part of MS package (In US for example, it comes installed in Federal Government PCs, making its use the default option). This software also produces good report and diagrams that come as a default option.

MP Project also has some disadvantages. For example, it calls ‘slack’ to float values in the project for completed activities and only allows up to 2 relationship between two activities. This could prevent the user from user other relationships such Start- Start-to-Start and Finish-to-Finish that for some projects are fundamental can reflect a different reality of the project. This feature can be found in Primavera.

There is a trend that suggests an increase on usage of PM software. Data suggests that over the past year, the usage of CPM has doubled (Winter, Evrenosoglu 2011). The usage of project management software has increased mostly in the construction industry.

One of the drivers that influence the usage of PM software is the complexity of the project. The application of the CPM can be prevented when the complexity the project is high and can lead to misconceptions. The experience in using project management software, the size and the project and third party requests are also key drivers when defining what technique to apply and when doing so. (Winter, Evrenosoglu 2011).

It has been commonly seen that for construction projects, it is required periodic schedule updates. A schedule update is an assessment of the project status and prediction of how and when the project will be completed. Proper updating of the work schedule is an integral part of project management and a critical communication between the parties. The schedule update should reflect the current plan to reach project completion and an accurate record of the past performance. The major steps in updating a schedule involve (Al Samman, Al Brahen 2014)

New development

The case study of Horizontal Lamina in Brazil

In 2016 a medium-sized company called Horizontal Lamina Tor Production used PERT/CPM to the reduce time and cost in some of the. The Brazilian company located in Parana State showed that it is possible to apply these techniques in small machinery processes.

The machine is used to cut polyurethane foam blocks to make mattresses. It was necessary to analyse and define the activities and then their interdependencies. It was also required to propose the normal, accelerated and no accelerated durations. These durations change as the production target varies in a year of production.

The machine is a laminator structure that divides cutting tables and headstock. The table transports the pack in cutting and the headstock ensures that alignment of the blade and precision. To optimise the times and costs, PERT/CPM have been applied to the production process.

The findings show that the project can be completed in around 520 hours at a cost of R$7,042.50 when using normal duration. However, when it is required to accelerate the process, it can be finished in around 333.3 hours at a total cost of R$9,263.01. In case that the activities slacks are exploited, it can be obtained a total cost of R$6,157.8 without interfering in the new duration of the project.

In terms of costs, after the application of PERT/CPM, the initial cost of the project was reduced by 12.56% of the total project cost, making possible to increase productivity.

References

• Javier Castro, Daniel Gomez, Juan Tejada, 2007, A rule for slack allocation proportional to the duration in a PERT network,, Complutense University pp. 1-16.

• Banerjee Arunava, Paul Anand ,2007, On path correlation and PERT bias, European Journal of Operational Research, Department of Computer and Information Science and Engineering, University of Florida pp 1-5

• Fernando Henrique Lermen, Marcia de Fatima Morais, Camila Matos, Rodrigo Roder, Celise Roder, Independert Journal of Management and Production September 2016 p.p 2-28.

• Thaeir Ahmed Saadoon Al Samman, Ramadan M. Ramo Al Brahem, 2014, College of Administration and Economics Management Information Systems Department University of Mosul, Iraq. International Journal of Advances in Engineering and Technology

• Punmia, B.C. and K. Khandelwal. Project Planning and Control P.E.R.T. and C.P.M.: For Degree Classes. Laxmi Publications, 2006.

• Harvey Maylor. Beyon the Gantt chart: Project Management Moving On 2002. Pergamon. European Management Journal. Volume 19. Pp 90- 98.

• Ron Winter, PSP F. Burak Evrenosoglu, Ms Project for Construction Schedulers, 2011, The AACE International 55th Annuel Meeting June, Disneyland Hotel, Anaheim, California USA.

• Ron Winter, 2013, the history of Primavera Scheduling Software.

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