CHAPTER 4

PERT AND CPM

4-1 Introduction
What is PERT and what is CPM?
PERT is a Program Evaluation and Review Technique.
CPM is the Critical Path Method.
PERT and CPM were developed independently in the later part of 1950's. These two are
networks. A techniques, used for planning and coordinating large scale projects.
The use of PERT began in 1958 through the joint efforts of the Lockheed Aircraft, the U.S.
Navy Special Project Office and the consulting firm of Booz, Allen and Hamilton in the efforts of
the U.S. government to speed up the Polaris Missile project.
The U.S. government's apprehension that the Soviet Union, might gained nuclear superiority
over the US., early completion of the project was given top priority. A special operations research
team was directed to formulate a new approach considering that the management concepts and
methods at that time were not adequate. The concept was formulated by the research team and is
then called Program Evaluation and Review Technique, which is simply called PERT.
The Polaris Missile project is a large one involving over 3,000 contractors and 11,000 sub-
contractors with several thousands of work activities. The use of PERT in this large scale project
was proven successful in shortening the length of the project completion time.
In 1956, prior to the development of PERT, the Critical Path Method which is simply called
CPM was developed by J.E.Kelly of the Remingten Rand Corp, and M.R. Walker of Du Pont in
an effort by commercial industry to make an advanced scheduling and cost control methods. By
April 1958, CPM in application was demonstrated in a real success.
CPM was designed as a tool for planning, scheduling, and control of construction work. Its
emphasis was on the work or activities to be managed. The network diagram defined and focused
attention on the job to be accomplished. The schedule derives the earliest and the latest times for
their start and finish.
PERT was developed as a result of looking for an improved method of planning and evaluating
progress of a large scale research and development program. It was designed to provide the
management a periodic reporting of current status and an outlook for the future on meeting
approved plans and schedules. It answers the questions such as: "Is this a feasible schedule? And
what are the probabilities of making it?
Although PERT and CPM were developed independently, yet, they have a great deal in
common. Users adopted certain features from one technique for use with the other.
 For instance, PERT originally stressed probabilistic activity time estimate because the field in
which it was developed was typified by high uncertainty. In contrast, CPM originally made no
provisions for variable time estimates. However, from a conceptual analysis, most of these
differences were relatively minor. For practical purposes, the two techniques are the same. Thus,
comments and procedures described will apply to both PERT and CPM project analysis.
PERT/CPM is a control tool for defining the parts of construction job and then putting them
together in a network form. It serves as an aid to the construction manager but it does not make
decision for him nor does it guarantee good management. PERT/ CPM only serves the project
manager to see the whole picture of the entire job. It encourages periodic re-evaluation and
providing an accurate measure of progress. Thus, a person in charge of each work and the project
manager know what is supposed to happen and when it is supposed to happen.

4-2 PERT/CPM Project Requirements

Today, ether of the two techniques can be used with deter-ministic or probabilities of time. The
remarkable historical record of PERT and CPM on large scale projects accomplishment has gained
world wide acceptance. In all major projects of the government, PERT and CPM network is a
mandatory requirements.
Under Presidential Decree (PD) 1594, Prescribing Policies, Guidelines, Rules and Regulations
for government infrastructure contracts provides that:
"The program of work shall include, among others things, estimates of the work items,
quantities, costs and a PERT/CPM network of the project activities...in the preparation of the
bidding documents, the government shall make and estimate of the actual number of working days
required to complete the project through PERT/CPM analysis of the project activities and corrected
for holidays and weekends."
On January 27, 1968, president Ferdinand E. Marcos issued Memorandum Circular No. 153
which provides that:
"In order that the performance discipline on the field could be controlled and easy reporting
system could be made to facilitate the monitoring, evaluation, inspection completion of
infrastructure projects, all heads of departments and chief of bureaus and offices concerned are
hereby required to change the old system of preparing the work programs of said projects from the
Gantt Chart (Bar Type) to the PERT/CPM network. Strict compliance herewith is enjoined. "
On June 19, 1968, the Executive Committee for Infrastructure Program implemented the
Presidential Order in a letter to all implementing agencies to wit:
"Your attention is invited to a Presidential Order requiring the preparation of a PERT/CPM
diagram for every major project prior to their actual construction."
Section 6 of RA 5979 requires the application of PERT/CPM technique to all projects with
an estimated cost of P100,000 more. Thus, PERT/CPM now has become an integral part as
requirement of project construction management.
 With the use of PERT/CPM, the project manager can easily obtain the following
informations:
1. The graphical display of project activities
2. An estimate of how long will the project last
3. Determine which activities are the most critical to timely project completion.
4. Determine how long any activity can be delayed without lengthening the project.

4-3 Three Phases of PERT/CPM

The three phases of PERT/CPM are:
1. Planning
2. Scheduling
3. Control-Monitor
Planning
Planning is defined as determining the relationship between the work operation and the
sequence in which they are to be performed. Scheduling or sequence involves distribution of
work time to each work operation and determining when to start and when to finish.
Each work operation can be performed in different ways at different costs and in different time
duration. Most construction projects have specified time of start and time of completion. When the
contract time is less, in effect it requires higher indirect costs. Thus, in order to catch-up with the
allotted time, some of the operations must be speeded-up. Consequently, to speed up construction
work requires higher direct cost because of overtime, shift of work, additional manpower and
equipment and various expensive methods which are not done on normal construction operations
with sufficient time duration.
However, there is a danger that shortening a single operation may only increase project cost
but may not shortened construction time considering that other operations have not been shortened.
On the other hand, shortening all operations at the same time may only increase project cost more
than what is necessary to obtain the desired decrease of construction time.
The Critical Path Method (CPM) offers the solution through systematic approach. The specific
informations provided by the CPM are enumerated as follows:
1. PERT/CPM pinpoints the particular work operations whose completion times are
responsible for controlling the complete date.
2. It provides a means of speeding up a project without excessive costs for overtime.
Without the use of PERT/CPM when speeding up the project overtime expenditures
may be in total waste.
3. It gives a time leeway or float available for each of the non-critical work operations.
The information on float time will give the project manager that opportunity to
maneuver in their planning and control of the operations.
 4. It establishes time boundaries for operations with possibilities of shifting resources,
equipment and manpower to meet time requirements.
5. PERT/CPM indicates the earliest starting date for each work operations and sub-
contracts for supply and delivery of materials.
6. It shows the most advantageous scheduling for all operations. This gives planning
informations as to time and cost in choosing methods, equipment, crew and work hours.
7. It offers a means of assessing the effect on the overall project variations in one
operation such as change orders.
8. In case of change order where the owner would not want to extend the contract time,
PERT/CPM offers a means of re-scheduling the operations but still to be completed at
the least increase in cost.
9. With the critical path schedule as revised to reflect the change order, any claim if any,
for additional payment will be understood both by the owner and the contractor.
10. In case of serious delay due to weather, late material or equipment delivery, the network
can be revised at that stage and new computation is made to determine the new critical
operation if any and revised float times determined for the non-critical operations.
In any project construction undertakings, planning is the most important consideration which
includes:
1. Gathering of all the necessary input data to make the PERT/CPM works.
2. Planning phase is the main work of the contractor for being familiar and knowledgeable of
his costing methods of doing business.
3. The contractor can seek assistance for the accomplishment of his work particularly the
gathering of data, but his basic responsibility on this matter cannot be delegated to any
outsider group.
4. The contractor has the complete perception, experiences, resources, and interest in getting
the project done in the best possible time and cost.
5. The planning stages give the contractor a "Dry Run" on the construction of the project.
6. If the contractor wants an effective approach and use of the construction management, he
must do it himself.
7. By performing the work personally, one obtains intimate first hand knowledge of the job
and gain insight and details of anticipated problems.
SCHEDULING
In PERT/CPM, Scheduling is defined as the process of translating the arrow diagram into
time table of calendar days. This is done by the day date table converting working days into
calendar days which permits the inclusion of weekends, holidays, weather and other time lost.
The PERT/CPM schedule shows the relationships between the operations and the leeway
limitations. All activities should be checked with the day to day table. All crew and management
restraints along the critical path should be verified and the restraints should be adjusted to give
satisfactory project completion. Non critical activities can be scheduled to more efficiently utilize
manpower and available resources.
 Job control through the use of PERT/CPM gives the management a reliable system
identifying job problems within days instead of months. Progress along the arrow diagram should
be updated for immediate references. The diagram must show the status of the project at any time
and indicate which activities can be started and to pinpoint the cause of the delay.
The PERT/CPM diagram should be updated periodically to account for:
1. Time discrepancies
2. Deliveries
3. Weather
4. Change orders
5. Unexpected events or conditions.
Updating of the diagram is based on the number of days the project is out of schedule.
CONTROLLING AND MONITORING
Flexibility and updated re-computations brought about by changing conditions is the key
to a successful network programming. To keep the schedule more up to date and meaningful, it
can be done by hand but is more easier and less in cost if it is done with the assistance of computer
to have the following output.
1. The contractor is supplied with time status reports showing the overall status of the project
in general and in particular.
2. The contractor is provided with revised schedules which reflect the actual work conditions
and the project status.
3. The contractor is supplied with cost status reports showing how much money is being
disbursed for what type of expenses.
4. The contractor should be supplied with those reports as frequently as desired or required
to maintain control over the project.
In the Planning Phase, there are five inputs that can be obtained:
1. A network diagram defining the activities in the project.
2. The duration of activities
3. Cost estimates of the activities for monitoring cost, cash flow requirements
4. Resource estimates
5. Trade indicators (responsibility) for activity grouping.

From the Schedule Phase, there are four output that can be obtained:
1. The schedule of activities in the network showing the following:
a. The Critical Activities
b. The Earliest Start date for each activity
c. The Earliest Finish date for each activity
d. The Latest Start date for each activity
 e. The Latest Finish date for each activity
f. The Float which refers to the amount of extra time available for an activity.
2. A Bar Chart or a Time Scaled Network (arrow diagram network for the project).
3. A Resource Analysis showing the number and kind of resources, man power, equipment
and others that are required for each day of the project.
4. A Cash Requirement prediction indicating how much cash to be disbursed for the job and
the amount of money that will be collected as a result of work accomplishment.
The Control Monitor Phase uses actual data which includes:
1. Additions to the project - This refers to the new activities.
2. Deletion from the project
3. Changes as to duration, description, trade indicators, cost estimates or resource estimates.
4. Actual starting dates
5. Actual finishing dates.
The Output Phase consists of the following:
1. Time status report
2. Revised schedules
3. Revised Bar Charts/ Arrow Diagram or Network
4. Revised resource analysis
5. Revised cash flow predictions
6. Cost status reports
There are three major reasons for construction failure:
1. Unbalanced organization due to lack of planning and scheduling
2. Lack of financial planning
3. Poor cost control

ILLUSTRATION 5-7
From the following network, activities a and b both precede activity e. But d's start is dependent
only on completion of activity b, and not on activity a's. Similarly e is dependent on c.
 FIGURE 5-16
ILLUSTRATION 5-8
Starting and ending arrows are sometimes used during development of a network diagram for more
clarity.

FIGURE 5-17
Rules for Numbering Events in a Network Diagram
1. All events should be numbered starting from left to right.
2. No event number should be lower than the number of event preceding it (left to right
direction).
3. Event number shall increase from left to right.
Events should be numbered from top to bottom. Similarly, Increasing should be consistent
from top to bottom or from bottom to top When a group of N parallel activities starts from the
same event and ends with the same subsequent event, N-1 parallel activities in the group should
be joined to the subsequent event with dummy activities for identification purposes.

FIGURE 5-18
ILLUSTRATION 5-9
From the following table of information, (a) Draw a precedence diagram, (b) Find the
Critical Path, (c) Determine the expected duration of the project.
Activity Precedes Expected time (days)
a c, b 4
c d 12
d i 2
b i 5
e f 3
f j 8
i j 12
j end 9
g h 1
h k 3
k end 15

SOLUTION
1. Use pencil in constructing precedence diagram.
2. Activities without predecessors are placed at the start of the network (left side)
3. Activities with multiple predecessors are located at path intersections.
4. Start with a single node and end with a single node
5. Avoid having paths that cross with each other.
6. Number nodes from left to right
7. Activities should go from left to right.
8. Use only one arrow between any pair of nodes.
Examining the table of informations above; Letters a, e and g are absent in the precedes
column.
Therefore, these are the activities without predecessors.
a precedes c, d
e precedes f
g precedes h
The next question is to find the Critical Path.
 Examining the above network diagram we have the following route or path.
Path:
a, c, d, i,j = 4+12+2+12+9 = 39"
a, b, i,j = 4+5+12+9 = 30
e. f.j = 3+8 +9 = 20
g, h, k = 1+3+15= 19

From the above tabulation, the highest number is 39, thus, Path a, c, d, i, j is the Critical Path
which means the longest route.
Similarly, the duration of the project is 39 which could be in terms of days, weeks or months.

Problem Exercise
(1.) Number the events of the following networks in proper sequence
Problem Exercise
(3.) Construct a Network Diagram from the following informations:
Activity Precedes Expected time (weeks)
a c 15
b c, d 13
c e 8
d end 5
e end 3

(4.)
Activity Precedes Expected time (days)
f g, h 10
g i, j 10
h j 8
i end 6
j k 12
k end 7

(5.) From the following informations, draw the CPM network and number the events in their proper
sequence.
*A, B and C are starting activities and may begin at the same time.
*D and E follows A and cannot start until A is completed.
*G follows and depends on C.
*F is dependent on the completion of B and D.
*G and F must be done before H can start
*J also depends on G and F and it is an ending activity.
*I is also an ending activity but it cannot start until E and H are completed
(6.) Draw the network diagram of the following information.
A-is the first job of the project
O and N are the two final jobs for project completion
K -Precedes 0
N - follows L and M
J - restricts the start of K and M
C and B depends on the completion of A
D follows B and may go on in parallel with C and E
E follows C
I - restricts the start of J and L
H and G also restrict K and M
F must precede G and may go in parallel with H
E and D restrict H and I
C-must precede F.
(7.) Draw the Network Diagram of the following information:
a. At the start of the project, each of 3 separate activities A, B and C may or may not begin
and progress concurrently.
b. D may begin until A is completed.
c. E may also begin only after completion of A
d. F follows activity of B.
e. G cannot be started until both E and F are completed.
f. Completion on both G and H allow J to start.
g. The start of J is further restrained by a notice of completion of D.
h. K follows D and culminates in the same (completion) as event J.
(8.) Draw the following network:
a. G follows F but precede H
b. G follows D but precede J
c. M follows H but precede L
d. K follows A but precede L
e. F follows A
f. A and D start at the same time
g. J and L terminate at the same time.
(9.) From the following data, construct a network diagram.
Activity Precedes
a c
b d, e
c f
d g
e g
f end
g end

(10.) Using the following informations, perform the following:

a. Network diagram
b. Determine which activities are on the critical path
c. Compute the length of critical path
Activity Estimated time (days)
1-2 5
2-3 6
2-4 4
3-6 10
6-7 3
4-5 5
4-7 16
5-7 10
 CHAPTER 6
THE NETWORK DIAGRAM
6-1 Introduction
All kinds of project be it engineering, administrative or construction have their own unique
characteristics. However, there are certain basic characteristics, which are common to any project.
Every project is composed of works, activities, tasks or functions that are related to one or the
other in some manner. But generally, they must all be completed because the main goal is to finish
the project under the following objectives.
1. To complete the project at the earliest minimum time.
2. To use any available manpower, equipment and other resources
3. To complete the project with a minimum capital investment without causing undue delay.
For management to function effectively, the project planning system used must consider all
available alternatives. The options could be a possibility of utilizing its full resources such as
money, manpower, facilities and equipment. Only when the management knows and learned how
to use these options can it discharge its responsibilities.
This is a management problem of how to select the plan, which will utilize all resources
effectively as possible.
The answer is PERT/CPM. A basic tool, that will tell the management how to build a project
on a pre-determined activities and number of days at a projected cost.
Construction management basically consider Time as the controlling factor of all available
resources from money, man-power, facilities and equipments As the controlling factor.
Time versus number of manpower
Time versus number of equipment
Time versus peso

6-2 Planning and Scheduling

In Planning, the logical sequence of the job to be performed must be formalized under the
following considerations:
1. The logic of its sequence must be reviewed for correctness
2. A further review should be entertained to ascertain that all phases of works should appear.
3. That the scope of work is correctly interpreted.
Resources which are required in performing each job must be in placed and available when
needed. Resources can be time, manpower, equipment, facilities and money. Management must
review the plans and the resource requirements and then select project plan that offers the best for
the project.
Planning Objectives
The project manager's objective in planning could be summarized as follows:
1. To represent graphically the specific job and the proper sequence of the job.
2. To establish a medium for estimating the time, manpower or other resources necessary for
each job.
3. To have available sequential arrangement of the jobs, at accurate estimate of resources and
the alternative plans based on the scope of work

Scheduling - is only secondary to planning. It is the process of allocating calendar dates to jobs
based on the approved plan.
General time boundaries are determined for each job during the process of planning.

6-3 Definition of Terms

In developing a Network Diagram, there are important terms that we must be familiar with
because of their importance and functions in the network. Unless these terms are known, we will
be lost in the process of network diagramming.
Critical Path-Is the longest route in the network of activities representing a project. The sum
of the activities duration along this route is the duration of the project.
In other words, the time required to complete a project is numerically equal to the length of
the route which is called critical path. Activities along the critical path are called Critical Activities
of the project and any delay in their completion may result in the delay of the entire project. There
may be more than one critical path in a network and the critical path may shift as the project moves
toward the completion.
Earliest Event - Is the earliest time occurrence of an event sometimes called Earliest Event
Time or Early Event Time. It is the earliest time an event can happen without delaying the Earliest
Start of any activity.
The Earliest Event time is numerically equal to the longest path of activities in series from the
project start to the finish. Unless specified, the Earliest Event Time of the starting event is assumed
to be zero.
The Earliest Start of an activity cannot be earlier than the earliest event time of the event. In
other words, the Earliest Start of any activity is always equal to the Earliest Event at the beginning
of an arrow which is sometimes called i-node. The point of an arrow is called j-node.
i- node ------------------------------------> j-node
 Early Start is not necessarily the point in time that the activity will be over, but it is the earliest
time that it can occur. It is the first day after the physical assumption of the activity.
The Earliest Finish of an activity is equal to its Earliest Start plus its duration or time.
Therefore:
ES = ES+ Duration or
EF = Early Event + Duration
The Latest Event time- is the latest time the event may occur without delaying project
completion. It is numerically equal to the length of the critical path minus the longest path from
the project and event to the event in question.
The Latest Finish of an activity cannot be later than the latest event time of its j-node. In short,
all activities with the same J-node have the same late finish which is the same as the latest event
time at their common node.
The Latest Start plus Duration is equals the Latest Finish.
LS + D= LF or
LS = LF-D
Activity Total Float or Activity Total Slack - Is the span of time an activity can be delayed
after its earliest start time without delaying the project completion. It is numerically equal to the
total time for the activity minus the activity duration.
LF - EF = Total Float or LS + D (ES+D) or LS - ES =Total Float
The activity Free Float - is the span of time an activity can be delayed after its Early Start
without delaying the Earliest Start of any succeeding actual activity that may be availed of and
still allow its succeeding real activities to begin at their Earliest Start time.
It is numerically equal to the ES of any of its succeeding real activities minus the Earliest
Finish (EF) of an activity in question.
Activity Free Float is equals the Early Event time at the i- node of the next succeeding real
activity minus the EF of the activity.
FF = ES - (ES + D)
Independent Float - Is that portion of the activities Free Float that would remain if all its
preceding activities used up all their float.
It is numerically equal to the ES of the succeeding real activities minus the LF of the
preceding activities minus the duration of activity in question.
I.F. = ES- (LF -D)
 When the result of applying this formula is negative, it means that there is no independent
float. The independent float is equal to zero.