Critical Path Analysis

Critical Path Analysis involves using a network diagram to manage the various tasks required to
complete a project. The use of Critical Path Analysis can help a manager to complete a project in the
shortest space of time possible and identify critical activities.

Information required to carry out Critical Path Analysis

Identification of all the tasks necessary to implement the strategy.

The length of time each task takes to complete it to a satisfactory level.

The order in which tasks must be completed – the dependent activities.

Activities that can be completed at the same time – parallel activities.

Interpreting network analysis diagrams

EST Activity

5 C
1
2

7 6

LFT

Node number Duration

Each circle (node) is numbered and represents the start and end of an activity.

A straight line represents the activity. Activity number above the line, duration below the line, for
example, 8 weeks.

The earliest start time (EST) of an activity is shown in the top right of the left-side node; for example,
activity C EST is week 5.

The latest finish time (LFT) of an activity is shown in the bottom right of the left-side node.

The steps in constructing a network diagram

1- If required, construct the network diagram form an activities table showing the activity,
what each activity is preceded by and the duration of each activity is preceded by and the
duration of each activity.
2- All activities start as soon as possible; for example, if there activities can start immediately,
three separate lines will be drawn from the first node.
3- Add the earliest start times for each activity. Left to right. EST=EST of previous activity +
duration of the activity.
 4- Add the latest finish time to each activity working right to left. LFT= previous LFT – activity
duration. If there is a choice of numbers, choose the largest to deduct.
5- Calculate the float time for each activity.
Float time = LFT – duration – EST.
6- Identify the critical path by hatching the lines of the activities on the critical path ( // )

Float and Critical path

The float time of an activity is any slack by which an activity can overrun. Float time is important for
identifying which activities have flexibility.

The critical path is the route through the network diagram where there is no float time. These
activities are critical because, if they overrun, the expected duration of the project will be extended.
Identifying the float time on activities and the critical path is the last stage of completing network
analysis.

• Carrying out network analysis can help managers to identify key activities, improve
efficiency and manage resources effectively. .
Now try this
1. What are the EST and LFT on a network diagram?
2. What is the ‘float’ on an activity?
3. What is meant by the ‘critical path’?
Example of a completed Critical Path Analysis diagram
Use the notes below to interpret the information shown in this network diagram.
The benefits of Critical Path Analysis

A manager can use Critical Path Analysis to:

• Identify the extract activities involved in implementing a strategy.

• Effectively plan for the implementation of a strategy
• Introduce informed deadlines for different activities
• Allocate resources efficiently to the different activities
• Identify float time and those activities that are critical to the success/ implementation of the
strategy.
The limitations of Critical path Analysis

Critical path analysis has a number of limitations, including the following:

• Projects and strategies often involve multiple factors, agents and stakeholders – calculating
the time taken to complete an activity can be very difficult.
• It does not take into account qualitative issues such as employees morale or relationships
between workers.
• It does not take into account qualitative issues such as employee morale or relationships
between workers.
• It relies on estimations. If these are correct so are the ESTs and LFTs. Strategies will not be
implemented on time if this is incorrect.
• It does not take into account unexpected events and significant external factors beyond the
business’s control, such as key staff on long term absence.

Now try this

1. What are the benefits of using Critical Path Analysis when implementing a strategy?
2. What are the limitations of Critical Path Analysis?