CH06: NETWORK ANALYSIS Required:
Project Evaluation & Review Technique (PERT) and a. Draw the network diagram for this project.
Critical Path Method (CPM) – used in planning, scheduling b. Find the optimum completion time.
and controlling projects comprising various tasks or activities to c. Determine the critical path using CPM.
be performed by different individuals or departments for its
completion. Its objective is to estimate the completion time of
large or complex projects.
PERT – is used in planning and scheduling that uses
probabilistic activity times in a network diagram.
CPM – the activity times are generally known.
ACTIVITY ES EF
[ SYMBOLS AND TERMS USED IN PREPARING A TIME LS LF
NETWORK DIAGRAM ]
Activity C, D and E each has only 1 immediate predecessor,
thus, their ES will be equal to the EF of their immediate
predecessor.
Lastly, since Activity F has only 1 immediate predecessor
(Activity C), its ES will be the EF of Activity C which is 5. On
the other hand, the ES of Activity G should be the highest EF of
its two immediate predecessors which is 5 (i.e., 3 for Activity D
and 5 for Activity E).
[ STEPS IN PERT AND CPM ]
1. Develop a list of the activities included in a project.
2. Determine the immediate predecessor(s) and the
estimated completion time of each activity.
3. Draw a network diagram representing the activities
and immediate predecessor in Step 1 and Step 2.
4. Determine the ES and EF of each activity using In Step 5, the optimum completion time should be determined.
forward pass (start to finish). It can be done by tracing all the paths made in the network
5. Determine the OCT of the project. diagram from start to finish and getting the total of activity time
6. Determine the LF and LS of each activity using of events in the path. The highest total time among all paths is
backward pass (finish to start). the optimum completion time.
7. Determine the slack time.
8. Find the activities with zero slack time and
determine the critical path.
Illustration:
The following are the relevant information of the project: The computation of LF will start in the last activities which are
Activity F and G. Their LF is equal to the OCT. The LS can be
computed afterwards using the formula LS = LF – t.
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Next, since activities C, D and E has only one succeeding Prepare
activity (Activity F for Activity C and Activity G for Activity B C manufacturi A 2 3 4
and D), their LF is equal to the LS of the succeeding activity and ng plan
the LS can be computed afterwards. Manufacture
D product A 3 4 11
prototype
Prepare
E marketing A 2 3 4
activities
Prepare
F production C 1.5 2 2.5
cost budget
Moving forward to Activity A, since it has 2 succeeding Testing
activities (Activity C and D), the least LS of succeeding G product D 1.5 3 4.5
activities will be the LF of Activity A, thus, it will be 2 (2 for prototype
Activity C compared to 4 for Activity D). On the other hand, Completing
since Activity B has only one succeeding activity (Activity E), H market B,E 2.5 3.5 7.5
its LF will be the LS of Activity E which is 6. analysis
Prepare
product
I pricing & H 1.5 2 2.5
forecast
report
Prepare
summative
J F,G,I 1 2 3
product
ACTIVITY LS ES LF EF ST CRIT? report
A 0 0 2 2 0 ✓
Required:
B 3 0 6 3 3 X
C 2 2 5 5 0 ✓ a. Compute the t and σ2 of each activity.
D 7 2 8 3 5 X b. Draw the network diagram for this project.
E 6 3 8 5 3 X c. Find the optimum completion time.
F 5 5 9 9 0 ✓ d. Determine the critical path using CPM. The
G 8 5 9 6 3 X probability that the project will be completed in 20
This path is critical in the project because any delay in the weeks.
activities within this path will cause a delay in the whole
project. For example, let us say that the actual time consumed
in doing Activity A is 4 hours and all the other activities are
accomplished in time stated in table above, the time to
complete the series of activities in the project will be as
follows:
PERT: Probabilistic Activity Time (Uncertain Time)
In PERT, the activity time of each activity is not known with
certainty. The expected time (t) is computed using the formula
in the table above. Expected time is the average of the optimistic
time (a), most probable time (m) and pessimistic time (b).
Optimistic time is the shortest possible completion time, most
probable time is the most likely completion time while the
pessimistic time is the longest possible completion time. Also,
the variance of activity time of each activity is determined to
describe the dispersion or variability of activity time. Variance
is computed using the formula above.
Illustration:
The following are the relevant information of the project:
Immed
iate
Activity Description TIME
Predec
essor
A M B
Develop
A None 4 5 12
Product
Conduct
B market None 1 1.5 5
analysis
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Activity LS ES LF EF ST Crit?
A 0 0 6 6 0 ✓
B 7 0 9 2 7 X
C 10 6 13 9 4 X
D 7 6 12 11 1 X
E 6 6 9 9 0 ✓
F 13 9 15 11 4 X
H 9 9 13 13 0 ✓
I 13 13 15 15 0 ✓
J 15 15 17 17 0 ✓
The probability is determined using the cumulative normal
distribution table. The probability is 0.9656 or 96.56%.
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