Critical path method

From CEOpedia | Management online

Critical Path Method or CPM is an important project management method that helps to schedule project activities and estimate project duration. CPM provides project manager with the below information:

  • critical path for project completion,
  • minimum time required to finish the project,
  • dependencies between the tasks,
  • time buffer,
  • project timeline.

Critical Path Method was developed after World War 2 to schedule and manage complex construction and engineering projects. The method represented a network, where a set of events or activities were connected to each other in a flow manner leading from the beginning to the end. The intention was to represent the sequence of activities and relationships between them. At the same time, another method was developed, which is now closely associated with the CPM - Program evaluation and review technique (PERT). PERT was focusing more on the time that is required to complete an event or activity. As time passed, PERT was largely used together with CPM in project management (Fondahl J. W., 1987).

Critical Path Method

When a project enters planning phase project scheduling is taking place. For project scheduling project manager plans activities that will be completed as part of project execution. As part of this task, one must estimate the time that will be spent on each activity, budget, materials and labor. One of the methods that is used by project managers for project scheudling is Critical Path Method (Atin S., Lubis R., 2019). Critical Path Method is a very powerful method that provides information on what activities are critical for the project completion, what is the shortest possible project time and how best to schedule work to meet the desired results (Mercier A. G., 1965).

Nowadays, many computer programs offer CPM charts based on user characteristics, but the logic of the tool is almost the same for all of them. The project manager lists all tasks that must be completed as part of the project scope, their relationships and time estimates. Each activity or task is given a unique identifier, such as a letter or a number. Each activity is being plotted on the chart in circles and relationships are being established based on the data provided by the project manager. The sequence of relationships is being shown by arrows that are connecting two circles. There is a "start" circle, which links all activities that have no predecessors and there is a "finish" circle for activities that have no successor. A critical path is defined as the longest path in time from start to finish circles as it is shown in green colout in figure 1. This path indicates the minimum time required to finish the project and all its activities (Yang J-B., Kao C-K., 2012).

Fig. 1 Critical Path Method (source: Nikita Shtemenko)

The benefits of using the Critical Path Method are that the project manager can build a clear and cohesive schedule of the project. As part of this schedule, it is possible to see the information about latest start and latest finish, which also allows the project manager to plan their work and understand the time buffer that is available. Such time buffers can later be used for ad-hoc activities or to prevent the risk of delays (Zareei S., 2018).

Modern computerised technologies even allow project managers to apply budget on their critical path chart. This allows the project manager to view at which point in the project which costs will occur. Such information enables project managers to better budget management and mitigates the risks of cash gap or cash deficiency.

Critical Path Method should be used to determine the critical path of the project, to estimate the timeline of the project and dependencies of tasks. When using Critical Path Method, project manager should list all activites that are in scope of the project with the time required to finsih them. Then using specialised software, project manager will be able to convert list of tasks with time estimates to Gantt chart. Later a critical path method can be identified using the Gantt chart.

The summary of the Critical Path Method

Below if the quick summary of the Critical Path Method:

  1. Critical Path Method is a very common method that is used by many project managers to estimate the duration of the project, dependencies of the tasks and critical activities. CPM is often used together with the Gantt chart in project planning.
  2. Critical Path Method was developed in the late 1950s in the United States for complex construction projects.
  3. Critical Path Method is presented as a chart with a sequence of events from start to finish that represent their dependencies via arrows.
  4. The technology is constantly evolving enabling project managers to apply budget, resources and time estimates on their chart for better coordination and management.

Examples of Critical path method

  • Planning a wedding: CPM can be used to plan a wedding by scheduling tasks such as booking a venue, catering, sending out invitations, and organizing decorations. The project manager can use CPM to calculate the earliest and latest start and finish dates of each activity and determine the critical path, which is the sequence of activities that must be completed on time for the wedding to take place.
  • Building a house: CPM can be used to manage the construction of a house by scheduling tasks such as building the foundation, framing the house, installing the wiring, and constructing the roof. The project manager can use CPM to calculate the earliest and latest start and finish dates of each activity and determine the critical path, which is the sequence of activities that must be completed on time for the house to be built.
  • Developing a new software: CPM can be used to develop a new software by scheduling tasks such as designing the user interface, writing the code, testing the software, and launching the product. The project manager can use CPM to calculate the earliest and latest start and finish dates of each activity and determine the critical path, which is the sequence of activities that must be completed on time for the software to be released.

Advantages of Critical path method

The Critical Path Method (CPM) is an essential project management method used to schedule project activities and estimate project duration. Below are some of the advantages of using this method:

  • CPM helps project managers to identify the most important tasks that are essential for the successful completion of a project and prioritize them accordingly. This helps to ensure that the project is completed within the specified timeframe.
  • CPM also helps project managers to detect problems and develop solutions to ensure that the project stays within the budget and timeline. This helps to avoid costly delays and keep the project on track.
  • CPM can be used to track the progress of a project and identify any potential risks or delays. This helps project managers to take corrective action to ensure that the project is completed on time and within the budget.
  • CPM also helps project managers to identify the resources required for the project and plan for their acquisition. This helps to ensure that the resources are available when needed and that the project can be completed within the specified timeframe.

Limitations of Critical path method

Critical Path Method (CPM) is an important project management method that helps to schedule project activities and estimate project duration. However, it also comes with several limitations that can affect the accuracy of the results. These limitations include:

  • CPM does not always consider the time required for resources to become available, which can lead to inaccurate estimates regarding the duration of activities.
  • CPM does not consider the costs associated with certain activities, which can lead to budgeting errors.
  • CPM requires resources to be assigned to activities before they can be scheduled, which can be difficult to do accurately when resources may not be available.
  • CPM cannot accurately model the complexity of real-world projects, as it relies on linear and deterministic assumptions that do not account for uncertainty or risk.
  • CPM does not consider the interdependence of activities, which can lead to scheduling errors.
  • CPM does not take into account the quality of the activities, which can lead to inaccurate estimates of the project duration.

Other approaches related to Critical path method

There are several other approaches that can be used in combination with CPM to effectively manage a project. They are as follows:

  • Program Evaluation and Review Technique (PERT): This is a statistical tool used to estimate project duration by analyzing the uncertain variables of a project. It is used in combination with CPM to provide a more accurate estimate of project duration.
  • Agile Methodology: This approach is used to manage projects in an iterative and incremental manner. It helps to adapt to the changing needs of the stakeholders and manage the project more efficiently.
  • Lean Methodology: This approach focuses on reducing waste and maximizing efficiency by eliminating activities that do not add value to the project.
  • Six Sigma: This approach helps to improve the quality of the project by reducing process variation and improving the overall performance.

In summary, there are several other approaches that can be used in combination with CPM to effectively manage a project. These include Program Evaluation and Review Technique (PERT), Agile Methodology, Lean Methodology and Six Sigma. Each of these approaches has its own unique advantages and can be used to improve the quality and efficiency of the project.


Critical path method — recommended articles
Activity network diagram — Critical activities — Network charts — Baseline schedule — Sprint backlog — Software cost estimation — Arrow diagram — Management of complexity — MoSCoW technique

References

Author: Nikita Shtemenko

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