The execution of a project follows a definite path of planning, scheduling ad controlling. The first and the foremost aspect of a project is the project design. It is in fact the heart of the project entity. It defines the individual activities which go into the corpus of the project and their interrelationship with each other. Project design enables to identify the flow of event which must take place for the successful implementation of the project. Network techniques help the management of an organization in performing these functions efficiently and effectively.
A network comprises a set of exponents connected with each other in a sequential relationship with each step till the completion of a project. Network analysis is a system which plans both large and small projects by analyzing the project activities. Projects are broken down into simple activities, which are then arranged in a logical sequence. It is also decided as to which task will be performed simultaneously and which other sequentially.
Several techniques of project scheduling and control such as Bar charts, Programme Evaluation and Review Techniques (PERT) and Critical path method (CPM) are used. Of these CPM have some to be widely used in project management as they are very useful in the basic management functions of planning, scheduling and control. These techniques can be applied in diverse kinds of projects like construction of a projects, scheduling ship construction and repairs, end of the month closing of accounts, large, research projects etc.
- Programme Evaluation and Review Techniques (PERT)
PERT is concerned with two concepts
- Events: An event is a specific accomplishment that occurs at a recognizable point of time and does not call for either the need of time or resources.
- Activities: An activity is the work required to complete a specific event.
Steps in PERT
(i) The first step in the development of a PERT network is the establishment of objectives.
(ii) The second step is to schedule work breakdown in great detail.
(iii) In the third step both technical and managerial persons should begin to work together.
(iv) The fourth step is that each person who participants in the application of PERT to the control of the project should have some basic familiarity with the general nature of the work and with the ultimate objective desired.
In PERT, time is the basic measure. It is usually expressed in calendar weeks the project should be completed within the stipulated optimistic time.
In order to arrive at the most reliable estimate of time, three time estimates are usually employed under this technique as given below:
- The optimistic time: It is the shortest time possible if everything goes perfectly well with no complications, the chance of this optimum actually occurring might be one in a hundred.
- The pessimistic time: It is longest time conceivable, it includes time for unusual delays and thus the chance of its happening might be only one in a hundred;
- The most likely time: It would be the best estimate of what normally would occur.
The difference in these three times give a measure of the relative uncertainty involved in the activity.
ADVANTAGES OF PERT
(i) This technique gives the management the ability to plan the best possible use of resource to achieve a given goal within the overall time and cost limitations.
(ii) It helps management to handle the uncertainties involved in programmes where no standard time data of the Taylor – Gantt variety are available.
(iii) Use of this technique for active control of project requires frequent updating and revising the PERT calculations and this proves quite a costly affair.
LIMITATIONS OF PERT
(i) The basic difficulty comes in the way of time estimates for the completion of activities because activities are of non – repetitive type.
(ii) This technique does not consider resources required at various stages of the project.
(iii) Use of this technique for active control of a project requires updating and revising the PERT calculations and this proves quite a costly affair.
- CRITICAL PATH METHODS (CPM)
CPM was developed in 1956 at the E.I. Dupont Nemours & Co. U.S.A in connection with the Periodic overhauling and maintenance of a chemical plant. It resulted in reducing the shut down period from 130 hours to 90 hours and saving hours and saving the company $ 1 million. CPM has two time cost estimates for each activity ( one time cost estimates for the normal situation and the other estimate for the crash situation) but does not incorporate any statistical analysis in determining such time estimates. CPM operates on the assumptions that there is a precise known time that each activity in the project will take.
ADVANTAGES OF CPM
Besides being applicable to schedule large and small projects it has some of the important advantages listed below:
(i) It helps in ascertaining the time schedule.
(ii) With its aid, control by the management is made easy.
(iii) It makes better and detailed planning possible.
(iv) It proves a standard method for communicating project plans, schedules time and cost performance.
(v) It identifies the most critical elements and thus more attention can be paid to these activities.
LIMITATIONS OF CPM
(i) CPM fails to incorporate statistical analysis in determining the time estimates.
(ii) It operates on the assumption that there is a precise known time that each activity in the project will take but his may not be true in actual life.
(iii) It is difficult to use CPM as a controlling device for the simple reason that one must repeat the entire evaluation of the project each time when changes are introduced into the network. It may be remembered that CPM was initially developed as a static planning model and not as a dynamic controlling device.