CPA

NETWORK DIAGRAM
 REASONS FOR CPA
1. Opening of a new shop
2. Setting up a new IT system
3. Relocating company operations
4. Installing new machinery
5. Marketing products in another country
6. Building a factory

And many more

 CPA STEPS

1 Identify the objective of the project (e.g. build a factory in six

weeks).

2 Put the tasks that make up the project into the right sequence
and draw a network diagram of that sequence (see below).

3 Add the durations of each of the activities.

4 Identify the critical path – those activities that must be finished on

time for the project to be
finished in the shortest time.

5 Use the network as a control tool when problems occur during

the project.
SAMPLE OF CPA
A network diagram uses the following Order the new machine and await it arrival (B) –
notation: one day.
An arrow indicates each activity. Prepare the site for the new machine (C) – two
An activity takes up time and resources. days.
A node (circle) indicates the end of each Assemble the new machine (D) – two days.
activity. Install the new machine (E) – one week.
The activities involved in the project shown in Demonstrate the machine to workers (F) – two
Figure 28.11 and the estimated time for each days.
activity (duration) are:
Obtain the necessary raw materials (G) – one
Strip out the old machine (A) – three days.
day.
Trial test run (H) – three days.
SAMPLE QUESTION
SAMPLE QUESTION
SAMPLE QUESTION
SAMPLE QUESTION
 EST

• Calculating the EST

• The EST is the earliest time each activity can begin, taking into account all of the preceding
activities. So, Activity E cannot start before day 8 because A will not be finished before
then. And D cannot start before day 20 because both A and C have to be completed first.
 LFT

Calculating the LFT

The LFT is the latest time an activity can finish without delaying the whole project. So, Activity I (and all
preceding activities) must be finished by day 38 or the entire project will take longer than 42 days (because
four days must be allowed to finish J). Activity F (and all preceding activities) must finish by day 32 or the time
taken to complete G, I and J will take the total project time over 42 days.
The easiest way to calculate the LFTs is to work from right to left. The LFT at node 8 must be 42: the total
project time. The duration of Activity J is now subtracted from this to give 38. This is the LFT at node 7. Where
there is a choice of routes back to a node, the aim is to achieve the lowest number for LFT. The LFT for node 4
is therefore 21, achieved by working back through J, I and H, even though a higher number could be reached
by working through J, I, G and D. Remember, the lowest number at each node is what is required for the LFT.
 CALCULATING FLOAT TIMES FOR NON-CRITICAL ACTIVITIES

Look again at the network diagram for building a home. Non-critical activities B, C, D and H have float time.
All of the non-critical activities (those not on the critical path) will have a certain amount of spare time. This
spare time is called float. There are two types: total float and free float.
Total float
Total float is calculated by the formula: LFT – duration – EST
Take Activity D as an example. The LFT of D is 32 and the duration is 6. The EST of D is 20 and therefore:
total float for D = 32 – 6 – 20 = 6 days
Activity D could be delayed by up to six days without extending the total project duration or changing the
critical path.
 CALCULATING FLOAT TIMES FOR NON-CRITICAL ACTIVITIES
Free float
Free float is calculated by the formula:
EST (next activity) – duration – EST (this activity)
Take Activity B as an example. The EST of the next activity after B is 20. The duration of B is 6. The
EST at the start of B is 0 and therefore:
free float for B = 20 – 6 – 0 = 14
Activity B could be delayed by 14 days without delaying the start of either H or D, which are the
following activities
FLOAT TIMES
SAMPLE QUESTION
SAMPLE QUESTION
SAMPLE QUESTION
Figure 28.15: The correct network
SAMPLE QUESTION
ACTIVITY 28.8

Using a network diagram for Project X

Activities for Project X Preceding activities Duration

A – 4
B A 6
C A 7
D B 12
E C 9
F D and E 3
G A 16
H G and F 3

Table 28.5

1 Draw the network diagram for Project X.

2 Use the duration times to calculate the EST and LFT of each activity.
3 Identify the critical path.
4 Analyse the importance of this critical path to the operations manager.

The benefits of critical path analysis (CPA)

It has already been stated that network analysis can be used to assist the planning and management of
complex projects. The following are some of the advantages that result from using the technique:
 THE BENEFITS OF CRITICAL PATH ANALYSIS (CPA)
It has already been stated that network analysis can be used to assist the planning and management
of complex projects. The following are some of the advantages that result from using the technique:
The additional resources for speeding up a critical activity could come from the non-critical ones. To
Using a network diagram to calculate the total project duration allows businesses to give accurate use the house building example in Figure 28.13, if Activity F is to be reduced to eight days to
delivery dates. Customers may insist on a particular completion date and the critical time shows counter the delay on E, the resources of labour, materials and machinery could be taken from D or H,
whether the firm can make this date or not. as they both have spare time. This will allow a better and more efficient use of the firm’s resources.
This shows how the existence of float times on D and H allows resources to be allocated more
Calculating an EST for each activity allows the operations manager to order special equipment or efficiently.
materials needed for that task at the correct time. This ties the use of network analysis in with JIT
strategies and assists in the control of cash flow and working capital. The sequential and logical structure of the diagram lends itself well to computer applications and
nearly all business applications of network analysis are now run on computer.
Calculating the LFT of each activity provides a useful control tool for the operations manager. The
manager will be able to see whether the project is up to schedule by checking the actual completion The need to put all activities into sequence in order to structure the diagram forces managers to plan
times of activities against the network LFT. each project carefully by putting activities in the correct order.

Knowing the critical path is important. If there is a delay on a critical activity, as there is no float time, The need for rapid development of new products is now very great in today’s fast-changing
this will put back the timing of the whole project. This could lead to expensive damage claims from consumer markets. Network analysis gives design and engineering departments an advantage by
customers. By knowing the critical path, the operations manager can see which other activities need showing them the tasks that can be undertaken simultaneously in developing a new product.
to be speeded up if one has been delayed. For instance, in the network in Figure 28.13, if Activity E Reducing the total time taken by the new project is based on the principle of simultaneous
was delayed by two days due to bad weather or non-arrival of equipment, the operations manager engineering.
would know that one of the critical activities that follows needs to be accelerated to catch up the
time lost.
 EVALUATION CRITICAL PATH ANALYSIS (CPA)

Critical path analysis: evaluation

CPA (or network analysis) is a planning and control technique to assist with project management. It cannot guarantee a successful project by itself and, as with any
plan, requires skilled and motivated employees to put it into effect.
A plan is only as good as the management behind it. If management of the project is poor, then even a good critical path network diagram will not ensure success.
This is particularly true when attempting to make up for lost time on a critical activity. Experienced managers need to identify the cheapest option for using and
switching resources from non-critical activities.
Workers will feel more committed to the plan of operation if they have been consulted during its construction, for example, over likely duration times for each activity.
When using CPA for a completely new project, there may be considerable guesswork involved in estimating the durations for each activity. There will be no previous
experience to go on. Although the drawing of the network and addition of duration and float times are likely to be aided by computer, it can take skilled labour hours
to put a complex project onto a computer. This time and cost must be justified by the efficiency savings of applying the technique.