Difference Between PERT and CPM

Introduction

Managing projects well is important, whether it’s a small office or a huge project like Apple Park. You have many tasks to do, some that rely on others and some you can do independently.

To handle all this, there are two methods: PERT (Program Evaluation and Review Technique) and CPM (Critical Path Method). PERT was made in the 1950s by the Navy with help from Booz, Allen, and Hamilton. CPM was made by J.E. Kelly in 1957. These methods help plan and watch over projects. Let’s learn more about the difference between PERT and CPM and dive deeper into each of them

PERT (Project Evaluation and Review Technique)

PERT is a project scheduling and management technique that helps in analyzing and monitoring the progress of our project using various statistical tools. Using this technique, we cannot indicate the earliest completion time of the project, but rather only the expected time (with various levels of uncertainties) taking into account various risks which might hinder the project completion (for example, change in requirements, budget risks etc.). Formally speaking,

PERT (Project/ Program Evaluation and Review Technique) is a probabilistic (or non-deterministic), network-analysis based technique used to plan, schedule, and control projects involving non-repeating and uncertain activities.

What are the Steps Involved in PERT Analysis?

1. The project is divided into different constituent activities (along with associated time and resources).
2. The various precedence relationships are defined amongst those activities (for example, the activity of buying computers must precede the activity of installing software on those computers).
   The above two steps are the most important part of any PERT and CPM projects. This step must be performed with utmost seriousness taking inputs from all the stakeholders.
3. The various defined activities are further incorporated into a PERT chart which is a network diagram. Each activity is represented using an arrow, which is termed a branch or an arc. The beginning and end of an activity are depicted using a node, which is where the arcs start as well as terminate. We analyze this PERT chart and draw various conclusions.

Example PERT diagram is shown below:

Explanation of Diagram:

1. All the activities (such as creating schedules, installation of hardware, testing code, etc) are represented using arrows/arcs in the diagram.
2. All the arrows start as well as terminate at a node (which are represented using labeled squares), which represent the stage of completion of certain events in the project timeline.
3. The numbers/labels on the arcs represent the time units (such as weeks) required to complete the activity the corresponding arc depicts. Arcs emerging from the same node represent concurrent activities.
4. The dashed arrow (from events 6 to 9) shows a dummy activity which is an activity that requires no time or resources. It is merely a theoretical tool that helps us to maintain proper precedence relationships
5. PERT evolved as a project management technique for research-oriented projects because the outcomes of activities undertaken during research remain mostly uncertain. Therefore we cannot plan a definite way ahead beforehand. The best we can do is to devise a path for all possible outcomes at all stages. All the outcomes branching out from a given stage may or may not be equally probable, hence we can not ascertain the exact time we might take to go along a given path, since there are many. Therefore we have estimates or bounds for these time measures.

PERT provides us with three high precision time estimates (which inform the user about deadlines and thus helps in setting goals for the project) to handle this mess of uncertainty. We have the optimistic time estimate, the most likely time estimate, and the pessimistic time estimate, which provide us with the best, average, and worst time in which the project could be taken to completion. (isn’t this quite similar to time-complexity analysis where we use the worst case, average case, and the best case time complexity to ascertain the efficiency of the algorithms?). In fact, time analysis is the only concern of PERT. It does not take into account the cost problems which the teams might incur during the execution.

The various time estimates are made using time-network analysis techniques on the various events planned out in the PERT chart. Discussing the network analysis techniques and procedures for minutely analyzing the PERT chart is out of scope for this article, and we leave it up to the readers’ curiosity to look up further literature on the subject.

CPM (Critical Path Method)

CPM, like PERT, is a project management technique used for project progress monitoring through network analysis tools. However, CPM is favored in cases with historical project data, such as past project logs, aiding in cost and resource estimation.

Formally, CPM (Critical Path Method) is a deterministic technique for planning, scheduling, and controlling projects involving repetitive, predetermined activities. Before reading more about CPM, let us first try to understand what is meant by a critical path. The 'critical path' in project management represents the longest sequence of essential activities needed to conclude a project. Activities on this path are called 'critical activities' and determine the project’s duration and scheduling.

CPM’s primary objective is to identify the minimum time required to complete a project by following the critical path. Unlike PERT, CPM distinguishes between critical and non-critical tasks, and including all critical tasks is vital to minimize project duration.

CPM follows a procedure similar to PERT, defining required activities and their dependencies. It operates on deterministic projects, eliminating uncertainties common in research-based projects. Such projects, termed construction-based projects, aim to complete the project through predefined paths without unpredictability.

Here too, we use network analysis techniques (forward-pass and backward-pass, to be precise) to determine the minimum time in which we can finish the project. But unlike PERT, here we have only one-time estimate, and it helps us to understand the time-cost trade-offs too.

Explanation: Here too we’ve created a network diagram that is very similar to the one we had created while discussing PERT. But here, we’ve also shown the “critical path”, the path of activities along the minimum time which will be taken by the project to be finished. All other activities run parallel to some critical activity, and hence will be completed within the critical time.

Some important time terminologies related to CPM are:

• Earliest start time (ES)
• Latest start time (LS)
• Earliest finish time (EF)
• Latest finish time (LF)
• Float/Slack: A measure of how long you can delay an activity/task before it starts threatening your project’s deadline. The tasks lying on the critical path (that is, the critical activities) have zero float. Negative float means that the delay is endangering the deadline of the project. Positive float does not affect the project’s timeline.
• Critical path drag: Measure of delay caused to the project because of constraints on tasks in the critical path
• Crash duration: Crashing refers to the compression theory of reducing a project’s time of completion alongside the least additional cost. The concept of crashing is not applicable to PERT because there is no certainty in time (only bound estimates are present), making it hard to alter the activity duration. In CPM, we can execute crashes by moving around resources, adding more towards the end of the task, thereby reducing the overall completion time. Sometimes it can lead to cost overheads, but as mentioned earlier, CPM analysis is all about understanding cost-time trade-offs.

Key Difference Between PERT and CPM

The key difference between PERT (Program Evaluation and Review Technique) and CPM (Critical Path Method) lies in their approach to project management. PERT is a probabilistic technique suitable for research and development (R&D) projects, where outcomes are uncertain. It provides three time estimates, emphasizing precision but not considering cost. In contrast, CPM is deterministic, best suited for predictable projects like construction, offering a single time estimate. CPM balances time and cost considerations and is effective for projects with clear critical tasks. PERT employs event-oriented analysis, while CPM uses activity-oriented analysis, distinguishing critical tasks distinctly.

Difference Between PERT and CPM

Advantages and Disadvantages of PERT

Advantages of PERT


1. PERT can be used to design an optimum resource utilization method for project completion.
2. Time estimates in PERT are highly precise, unlike CPM where it is reasonably precise at best.
3. PERT analysis can deal with unpredictable activities which might occur during the lifetime of the project, such as delay in development, unforeseen hardware failure, etc.
4. PERT is very useful for research-oriented projects and projects which don’t have a predefined structural path for completion (also called construction based projects, which are planned using CPM).

Disadvantages of PERT

1. High focus on time analysis sometimes leads to ignoring the cost aspect of the project.
2. PERT analysis has a highly complex structure and is consequently difficult to implement and maintain.
3. Doesn’t work with projects which have iterative or repetitive phases, such as projects requiring multiple designs and verification cycles.
4. Since PERT doesn’t have a past project history to learn from (since it is used with new projects as mentioned above) the initial raw data might not provide the most accurate prediction/estimates of the project timeline.
5. Implementation and maintenance cost is also high.

Advantages and Disadvantages of CPM

Advantages of CPM


1. As with PERT, CPM allows the user to figure out the dependencies which help in proper scheduling and planning of the project
2. Optimizations are possible (like crashing, identifying the critical tasks etc.) in CPM
3. CPM allows the users to understand the various cost and time trade-offs
4. CPM is the best-suited technique for planning the execution of construction based projects
5. CPM allows the user to figure out activities/tasks which can be executed concurrently without affecting the overall dependencies
6. CPM is also the best-suited technique for projects which have iterative or repetitive activities

Disadvantages of CPM


1. In CPM, time estimates the completion of an activity/task is reasonable at best
2. CPM cannot handle the scheduling of personnel and resource allocation
3. The critical path may not always be very clear to the project manager. This is a big issue since precisely identifying the critical path is one of the most crucial steps in CPM.
4. Just like PERT, CPM networks can be highly complicated for bigger projects, which can lead to poor maintenance and workflow of the project

Applications of PERT and CPM

1. PERT and CPM help in planning and scheduling various projects (which might not be always related to software engineering)
2. Projects related to research and development (R&D) as well as construction based projects (like building dams, office building, developing embedded software, manufacturing processes)
3. Design and maintenance of all sorts of equipment, industrial plants, and systems.
4. Manufacturing and marketing products on different scales
5. And something as simple as organizing seminars and workshops too