What is the Critical Path Method in Project Management?

The critical path method was developed in the late 1950s by James E. Kelley and Morgan R. Walker. Critical Path Method (CPM) is used to estimate the minimum project duration and determine the amount of schedule flexibility on the logical network paths within the schedule model.     

What is the Critical Path Method in Project Management?

Successful project delivery requires essential project management methods in all types of organisations. For example, a project in any corporation would essentially have a range of activities that need to be completed in sequence or in parallel to achieve the project goal. For timely project completion, it is vital to understand the activities involved and how they relate to each other.

A delay in one activity could impact a related activity. Therefore, it is crucial to identify how each exercise is connected to another and what impact the activities may have on each other in successful project delivery.

For instance, consider a House Construction Project. This project would have several tasks in sequence, such as compacting the ground, forming solid bases, footing reinforcement, shuttering, footing concrete, column casting, construction of walls, masonry work to keep openings for windows, roofing, plastering work, fixing of doors and windows. Each of these tasks will require a different amount of time and resources.

Given the above example,

(1) The project consists of a defined set of activities that mark the end of the project when completed.

(2) The activities may be started and stopped independently within a given sequence.

(3) The tasks are performed in order; for example, the walls must be constructed before starting the roofing.

With the use of CPM analysis, builders can estimate the duration (hours, days, or weeks it will take to complete the task, including elapsed time), the effort (hours, days, or weeks that take to perform the actual work), and based on that they can estimate the cost or budget each task.

Likewise, the concept of CPM can be used in any project with interdependent activities for scheduling a set of project activities. It is a powerful tool in project management for optimising resource allocation.

Importance of Critical Path Method (CPM)

Optimum utilisation of time and resources 

 In projects, all tasks take time, but some are more time-consuming and labour-intensive than others. Therefore, it is vital to identify a precise day-to-day plan of what activities to prioritise. A critical path method is a helpful tool that facilitates task prioritisation, giving organisations a better understanding of how and where to utilise resources. In addition, it provides the team with an assessment of actual time versus planned time.

 The tool enables organisations to understand which tasks are taking longer than expected, which are ahead and scheduled, and which activities are right on track. The use of the tool will be helpful in terms of resource management.

 Improved planning 

 There is a risk of losing valuable time in the project process due to unanticipated bottlenecks. Certain activities must be completed in order for other activities to begin. If one person cannot start a particular activity because they're waiting on a required item to be completed, it will eventually slow down the progress. This can also create a chain of events that can put the project behind schedule. The critical path method plays a significant role in mapping out parallel tasks or activities in sequence. A thorough assessment and analysis using critical path scheduling techniques enable better time estimates. 

How to find the Critical Path of Project

The following are the steps to find the critical path of the project:

1. Divide the activities of the projects

Make a list of project activities and assign each activity with a name or a shortcode.

2. Create a dependency chart.

Put the activities in a logical line-up and identify dependencies.

3. Create a network diagram

Once all of the necessary activities are divided, make a visual activity line-up visual. The network diagrams are beneficial in connecting activities in the chart.

4. Estimate activity duration

It is crucial when planning any project to calculate how long each section will take. First, clearly define the beginning and end date for each task. Then set each task's estimated duration considering the order and dependencies of the activities.

5. Determine the Critical Path

The Critical Path is the sequence of activities that represents the longest path through a project, which determines the shortest possible duration. Thus, after estimating the time, now find the sequence of project tasks that represents the longest path.

6. Calculate the float

Float is the amount of time that a schedule activity can be delayed without delaying the early start date of any successor or violating a schedule constraint.

The float is determined by how long the activity takes to complete and how many days are available between the activity's start date and the one which follows directly afterward. For example, no float is available if a task takes four days to complete and only has four days available from the start to the following activity. Therefore it is a critical task.

However, float days would be available if a task only took one day to complete, but there are five days until the start of the following job.

Therefore, this task is not time critical and can be slightly delayed if necessary.

How to use the Critical Path Method

Schedule compression.

CPM is applicable in every project that determines the estimated time of interdependent activities. The method establishes a trade-off between the overall cost of the Project and the total time for completion of desired activities.

It assesses whether the estimated time could be reduced through compromising with cost (i.e. allowing the escalation of cost) or the same is not sound from a financial perspective.

CPM provides project managers with key information that allows them to minimise the project duration within certain limits by deploying additional resources at an optimal cost.

For example, if the project has some activities with negative floats, extra resources are inducted to reduce the negative float value. The process of reducing the time involved by allowing the increase in cost is known as crashing.

Initially, the normal time estimates for each activity are taken to calculate the project duration. To reduce the project duration, we need to reduce the time of critical activities because the reduction in time of any noncritical activity will not help in minimising the project duration. Therefore, the cheapest activity is selected for the crashing, and the process continues until any critical activity remains.

Resource levelling

CPM can also be used for resource-levelling. Resource levelling is a resource optimisation technique in which adjustments are made to the project schedule to optimise the allocation of resources and which may affect critical path.

Resource levelling balances the demand and supply of available resources. It allows adjustments in time deadlines to meet the constraints of resources.

Resource levelling is primarily done when the restriction is on the availability of the workforce.

Levelling assists in adjusting resources against the possible floats available in the activity.

It is helpful to reduce the burden on the limited resource and establish the trade-off between the overall duration of the project and the cost involved.

Critical Path Analysis is commonly used in large industrial houses where the time involved in completing an activity can be reasonably predicted, owing to previous experiences.

A few examples of industries where CPM has wide applications are construction, defence, installation of complex equipment, engineering, aerospace, maintenance and shifting of plants, launching space programmes, traffic flow patterns, and other large projects.

Critical Path Method and PERT

In PERT, the focus is on the start and completion of events and not activities. The activities that occur between events cannot be specified. It is appropriate for projects where the required time to complete different activities is unknown. PERT is usually applicable for scheduling, organisation, and integration of various tasks within a project.

On the other hand, CPM is used for projects where the time needed to complete the project is already known. It helps determine the approximate time during which a project can be completed. It provides a meaningful way to keep project costs and timelines checked and balanced effectively.

Critical Path Method and Gantt chart

The Critical Path Method shows how each activity is related to one another; however, a significant problem with the Gantt method is that the Gantt charts do not show how activities relate to one another.

The critical path method represents a network diagram that displays each project activity and connects them to show task dependencies. At the same time, the Gantt chart is a bar chart that lays out project activities and timelines for each activity.

Critical Path Method: Advantages and Disadvantages

 Advantages of Critical Path Method

It has the following advantages:

1. The CPM method determines the activities that can run parallel to each other.

2. The CPM helps the project managers identify the project's most critical elements.

3. CPM offers a straightforward approach to communicating project plans, schedules, time, and cost performance.

4. The CPM considers the requirements well in advance to complete a project in the most efficient way possible.

5. With the help of the CPM, the project manager can determine the duration and estimate the time and budget of the project.

Disadvantages of Critical Path Method

It has the following disadvantages:

1. CPM could be time consuming. It is also challenging to estimate the activity completion time in a multidimensional project.

2. The CPM networks can be complicated for extensive projects.

3. It cannot effectively tackle sudden changes in implementing the plan on the ground. For example, redrawing the entire CPM chart is extremely difficult if the project's plan suddenly changes midway.

4. CPM cannot form and control the schedules of the persons involved in the project.