The Critical Path Method (CPM)

Developed by Sissel Trap Wiegandt

This method article describes the Critical Path Method (CPM) also in comparison to other project management methods. This article describes how and when to use CPM methods, moreover discusses the advantages, disadvantages and applicability of the method. CPM is a step-by-step project management method for process planning. CPM was developed in 1956 by the E.I. du Pont de Nemours Company a major chemical plant construction firm in USA. By focusing on tasks duration CPM identifies the minimum length of time needed to complete a project and helps define the most critical tasks that needs to be accelerate in order to complete the project within the available time. Furthermore CPM can be used to monitor if the project follows the time schedule and it allows you to identify slack time (free resources). CPM is one of the fundamental concepts in traditional project management. CPM utilizes tasks duration as the parameter for optimization of the schedule, resource planning and control of construction projects.

Introduction to CPM

CPM is a step-by-step method for project planning and management. It is the presentation of a project plan by a schematic diagram that depicts the sequence and interaction of all the tasks of the project. The precursor of CPM was PERT (Program, Evaluation, Review and Technique) and PPS (Project Planning and Scheduling) developed by the U.S. Navy. PERT uses three time estimates (earliest, latest, average) to define the total project duration time, so less acurate time estimates can be used in this method. PPS focus on estimates on both cost and time for design, construction and maintenance work .

The main benefits of CPM for the projects managers are primarily to identify the most important tasks. By focusing on tasks duration CPM identifies the minimum length of time needed to complete a project, this is based on identifying the critical path. If any of the tasks forming the critical path take more time than their estimated durations, start or finish later than planned, then the whole project will be affected. The critical path is by the Project Management Body of Knowledge (PMBOK), an internationally recognized collection of processes and knowledge areas accepted as best practice for the project management profession. It is defined as “the sequence of scheduled activities that determines the duration of the project”. The critical path helps define the most efficient way to schedule the project. Although many projects have only one critical path, some projects may have multiple critical paths.

Secondly, CPM helps reduce timelines by identifying slack time. Slack time tells to what extent each activity in the schedule can slip (float) without delaying the project.

In the early stage of CPM there was not any computer programs to make the calculations and the network diagrams was made using hand drawn nodes to present the stages of a product. Today there are a number of project management software programs available that can do the calculation. Microsoft Project and Smartsheet are two different computerized tools that use CPM.

Tool and method

Table 1: Details of critical path

Activity	Predecessor	Duration (weeks)
A	-	2
B	A	3
C	B	1
D	A	6
E	C , D	3

CPM is still an incredibly important tool to project managers, even though it is almost 60 years old. It provides a visual representation of project activities and clearly presents the time required to complete tasks. Construction of a CPM can be subdivided into four phases.

picture 1: Precedence Diagram

Phase 1: The construction of a sequential relationship of the individual operations in the project where each task is named and defined (Table 1).

Picture 2: Aktivity Identity box

Phase 2: The construction of a sequential schedule called a Precedence Diagram (Picture 1). The Precedence Diagram depicting their sequential relationship.

Picture 3: CPM Diagram calculatoins, Including forward pass shows minimal time use (from left to right) and backward pass shows maximal time use (from right to left)

Phase 3:The construction of the Activity Identity boxes (Picture 2). Each task has an Activity Identity Box which contains information regarding task name, duration, early start, early finish, late finish, late start and slack time. The completion of the Activity Identity Boxes is carried out by filling in task name and duration, furthermore performing firstly a forward pass (early start, early finish) and backward pass (late finish, late start and slack time).

Picture 4: CPM Diagram including Critical path which is the longest duration time (red arrows) and slack time which is free resources (green boxes)

Phase 4:The CPM path diagram can be completed and the critical activities determining the overall project duration can be identified (Picture 3). The critical path is identified as the path with the longest duration time e.i. the fastest time the project can be finish. In the example (Picture 3) the critical path shown with the red arrow is A, D and E because the duration time 11 weeks is longer compared to 9 weeks for A, B, C and E. Furthermore slack time for the individual activities can be calculated either thought Late Finish minus Early Finish or Late Start minus Early Start (Picture 4).

Guidance on use

CPM is one of the fundamental concepts in traditional project management. Especially by construction contractors it can be applied for the planning, scheduling and control of construction projects. CPM produces a planned schedule to guide the project team, and it forms the basis for tracking project schedule performance by comparing actual with planned task progress. In a project with lots of tasks and dependencies it can be difficult to identify the most critical tasks that, if missed, will impact the whole project. CPM identifies this/these critical tasks and can be used to evaluate whether the project stay on track or not.

Insuring time schedule

The project manager has difficulties in estimating the exact duration for a project. This is caused by both CPM being based on the uncertain estimated task duration time and occurrence of unexpected factors which may impact tasks completion. Considerations needs to be made to minimise the effect of unexpected factors. Using the CPM the project manager may realize that he needs to compress the project schedule. There is two way of solving the issue either Fast Tracking or Crashing.

Fast Tracking In Fast Tracking the project manager searches for activities from the critical path that can be done parallel to each other, in order to move the project along faster. The reason to look only on tasks from the critical path is because all the other activities have slack time and having them finishing early is only going to give more slack time. While fast tracking reduces the project timeframe. It also involves risk because you are performing parallel activities that were originally planned to be performed in sequence.

Crashing Crashing is the other way of compressing or shorting down a project. Here the project manager identifies the shortest possible time for which a task can be scheduled when adding the necessary resources. By speeding up the processes there is a risk of lower quality of work.

The precusor to Gantt Chart

A Gantt Chart is a commonly used tool within project management, which, briefly, shows the progress of an ongoing project.The chart shows the tasks that need to be done in a project, when each task needs to be performed, and how long time they are going to take according to the plan. The critical path identified by the CPM is often used as a precursor to Gantt Charts.

Constrain issue

When managing a project with CPM you are focusing on the critical path. An unexpected event might change the critical path and a consequence could be resource constraint issues. Scheduling certain activities at the same time, might lead to a need of more people than there are available. A solution to this is to reschedule the activities and resource leveling. When the tasks on the critical path are affected by resource constraints the previously shorter path could become the longest or most “resource critical” path.

Comparison of work programs, construction methods and equipments

CPM permits comparison of alternative work programs, construction methods and equipments. CPM provides the projects manager with precise information on the effects of each variation or delay in the adopted plan and thereby indicates where to have the main focus to stay on time. Furthermore CPM allows you to identify slack time and helps you to secure that the project follows the time schedule.

Critical chain management

A new and more efficient way of utilizing the CPM is in the Critical Chain Management (CCM). CCM has five basic conditions (no milestones, no multitasking, no reporting of early completions of tasks, individual estimates of task duration is reduced with 50 %, buffer time is introduced). The task time estimate is minimised with 50 % in the critical chain management.This is compensated for by introduction of the buffer time. Further the buffer time are used as a warning mechanism during project schedule execution. If more than 66% of the buffer have been used then actions needs to be made.

Discussion

CPM is a project planning, managing and scheduling method which is easy to comprehend and to use. This is caused by the step-by-step method and the presentation of the project in an easy comprehensible schedule diagram, depicting both the sequence, duration and the interaction of all the tasks in the given project.

As a project manager it is mandatory for you continually to able to track the progress in the project. There are four different way to track the progress, either by using CPM, Gantt Chart, Critical Chain Management or PERT. Gantt Chart has the advantages of being able to evaluate the flow of the project on daily or weekly basis compared to CPM that can only check the progress of each finalised task. CPM often provides a better understanding than the conventional bar chart, because it illustrates relationship that controls the order of performance of the various operations. Critical Chain Management on the other hand follow the progress by looking at the buffer time. Moreover a challenge with the CPM is not to lose sight of the risks inherent in tasks not on the critical path. This might happen because of the extra attention the critical path requires. The completion of a task not on the critical path could be delayed, this could cause that the duration time becomes long enough to change the critical path of the project. There are two methods by which you can identify the critical path through the project. Either CPM as described above or PERT. PERT is used in projects with inaccurate time estimates by applying three time estimates to create the expected time duration for the project. With available accurate task time estimate CPM is the preferred method. CPM is the most simplified method and are therefore the preferred method.

CPM can be used to increase the effectiveness of a given project. Scheduling certain activities at the same time, might lead to a need of more people than there are available. A solution to this is to reschedule the activities. By identifying slack time it is possible to reallocate resources from tasks with slack to the critical tasks. Thereby being more efficient and securing timely completion.

By comparing alternative work programs, construction methods and equipments CPM can help evaluate which method is the most efficient. Each of the changes can be evaluatedseparately with CPM. The specific change can be placed in either the Precedence Diagram or in the Activity Identity box after which the CPM Diagram can be completed and the critical tasks can be determined to calculate the overall duration time.

The handmade CPM is fast to make for relatively simple projects and a god the manager can get a good overview of the tasks importance with the CPM Diagram but it is not as easy with bigger or more complicated projects. Here the computerization can be useful. It requires training to use and money to obtain, but can easy manage complex projects with multiple critical paths. Furthermore, the computerized CPM can quickly calculate new critical paths when a change occurs.

Limitations

A limitation of CPM is that it highlights tasks at greatest risk for causing schedule delays, but it does not identify the source of the schedule risks. Different methods, such as the Critical Resource Path Technique identified by Aguanno (2002) calculate alternate critical paths that focus on the risks caused by dependence on unique or constrained resources.

Time estimates

CPM needs only one time estimate per task, this makes it easy to handle but more inaccurate, compared to the PERT method, which is dependent on three time estimates per task (earliest, latest, average). A schedule created from CPM involves risk of fluctuation because it is based on best guess estimates to calculate time. CPM is therefore only as powerful as the estimates entered into it. If the estimations are off or if the resources are not calculated correctly, the critical path could change and a delay will happen in worse case it may cause an entire project to fail.

One way to overcome this issue is by applying the CCM. By diminishing the task time estimate with 50% you also minimizes the possible error estimate and by introducing the buffer time you have a pool of time to be spend when needed. Moreover the buffer time gives you a way of continuously overlooking the project schedule.

Computer programs

As projects often tend to be complex having several critical paths and change of the critical paths during the project, CPM can sometimes be difficult to use and understand. To overcome this challenge specialized computerized methods to calculate critical path have been developed. An example of this is the Linear Scheduling Model.

The advantages of the manual method compared with using the computer method is, that it overcomes certain weaknesses which result from the assumption that each operation in the project is independent of every other operation, except for the sequential relationship shown by the network chart. Furthermore it is impractical to exert intermediate control over the calculations to recognize changes in input data or related effects between operations with the computer method. On the other hand especially with long duration projects where the critical path will change often it is highly applicable with computerized methods being capable of new fast calculations.

Conclusion

CPM is one of the fundamental concepts in traditional project management. CPM utilizes tasks duration as the parameter for optimization of the schedule, resource planning and control of projects furthermore it is easy to comprehend and to use.

CPM is an effective and powerful method of assessing:

• The shortest time in which a project can be completed
• Task priorities
• The most critical tasks
• Tasks which have slack time
• Resources allocation needed to achieve a project
• The sequence of activities, scheduling, and timings involved

CPM often provides a better understanding than the conventional bar chart, because it illustrates relationships that controls the order of performance in the various operations. The knowledge of the operational flow can be used for resource allocation and equipment requirement estimates. Furthermore identifyed slack time can be used to optimize resource allocation. A manually calculated and drawn CPM diagrams is easy to perform and gives a good overview of the project. With more complicated project the need for computer programs are mandatory. Specialized computerized methods to calculate the critical path have been developed. Especially with long duration projects where the critical path will change often it is highly applicable with computerized methods being capable of new fast calculations. Moreover CPM provides a mechanism for determining all of the operations affected by a given change as well as the effect on project duration. It provides the mechanism for determine the least cost to compress project completion time.

A challenge with the CPM is not to lose sight of the risks inherent in tasks not on the critical path. A limitation of CPM is that it highlights tasks at greatest risk for causing schedule delays, but it does not identify the source of the schedule risks. To use CPM optimal focus has to be on securing accurate duration time.

Additional reading

For more information on the Critical Path Method, you might find the following sources useful
Articles

• Yamin R. & Harmelink. "Comparison of Linear Scheduling Model (LSM) and Critical Path Method (CPM)." J. Constr. Eng. Manage (2001): 127(5), 374-381. This is a technical paper by René A. Yamín and David J. Harmelink in cooperation with Journal of Construction Engineering and Management about differences and similarities between the two models Linear Scheduling and Critical Path.
• Aguanno, Kevin . "Critical Path: An Extended Definition." MMPUBS.com (2002). This is a five pages long artikel by Senior Project Manager, Kevin Aguanno. It describes history, definitions, limitations, alternatives and behind the Critical Path.
• Orr, Alan. "Uncharted Territory?". Engineering Management Journal. (2003). This is an article written by Alan Oro, and is written for a journal called Engineering Management Journal. It provides clear and thorough information about the basis of a Gantt chart, how to preform a Gantt Chart, individual features and how it can be used in management.

Critical Path Method and PERT explained by Dr. Pamela Zelbst

Videos

• Dr. Zelbst, Pamela. "Critical Path Method and PERT explained". (2015)This is a nice clip from youtube explaining the differences between CPM and PERT. First it explains in detail how the CPM can be used followed up by exampels. Secondly it compares the models.

Critical Path Method and PERT explained by Andrew Bell

• Bell, Andrew of coventry University. "Critical Chain Project Management". (2014) This video is about Critical Chain Project Management by Andrew Bell from Coventry University. the video also contains information about Agile Project Management.

Critical Chain Project Management by CEO Rob Newbold

• Newbold, Rob. "Critical Chain Project Management". (2011) This Video is made by Rob Newbold who is CEO of ProChain Solutions. It gives an introduction to Critical Chain approach to project management and how it provides an opportunity to make improvements to how a compagny managers its projects.

Books

• Woodhead, James M. Antill & Ronald W. "Critical Path Methods in Construction Practice". John Wiley & Sons, Inc. (1990). This is an "old" book from 1990. The descriptions of the Critical Path Method is very clarifying and detailed.
• Fondahl, John W. "A non-computer approach to the critical path method for the construction". Stanford University. (1962). This book is mad incoorporation with the department of civil engineering og Standford University by Jown W. Fondahl a professor of Civil Engineering. The preparation for this book is made under a research contract by the U.S. Navy. It contains the CPM approach and history. Because of its age the section about future implications it outdated.

Links

• Verma, Eshna. "What is Critical Chain Project Management?". Simplilearn (2009): http://www.simplilearn.com/what-is-critical-chain-project-management-rar68-article This link gives a good overview of the Critical Chain Project Management Method. It is written by Eshna Verma is a writer at Simplilearn.
• Burger, Rachel. "The Secret to the Critical Path Method in Construction". Capterra (2015): http://blog.capterra.com/construction-critical-path-method/A Simpel artikel the Critical Path Method with focus on how to use is in construction. It is very basic and foreseeable.
• Dr. Larry Bennett. "The Ultimate Guide to the Critical Path Method". Smartsheet (2015): https://www.smartsheet.com/critical-path-method/This is a good link with general informaiton about CPM, background, history, everyday advantages, key steps and comparrison with other methods. This link includes several good youtube clips made by the author Dr. Larry Bennett, a civil engineer, project manager, and author of four books, including a guide on critical path written in 1978. It also cantains multible comments from others with knowledge about CPM.