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What Is the Critical Path Method?

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  • Written By: Paul Reed
  • Edited By: Shereen Skola
  • Last Modified Date: 09 November 2016
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    2003-2016
    Conjecture Corporation
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The critical path method (CPM) is a way of breaking complex projects into lists of activities, and determining which are critical to keeping a project on schedule. Developed in the 1950s, this method was used for complicated government and private industry programs that were running behind schedule for undetermined reasons. A critical path as defined by the method as a series of events, called activities, which must be completed in the correct order and on time.

Construction or other projects can contain thousands of separate activities that occur before a job is done. Drawings must be made, a construction site must be prepared, and many other events must occur even before construction begins. During construction, foundations and building framework must be completed before the interior work can start. Some activities can occur at the same time, but some must wait until previous activities are completed. All of these assumptions are used in the critical path method.

Calculations of critical path timing can be done manually, but can be quite difficult due to the many interactions of activities. An easier way to create a CPM is using a computer spreadsheet program. Since the late 20th century, commercial software has existed that will create critical path method results from manually entered activity information.

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Developing a CPM report requires the use of assumptions, because a project typically has not started when the report is created. A project manager or programmer begins the process by listing all known activities from start to finish. Activities are given constraints if any exist, which may be an earliest calendar date an activity can start, or the latest date one can finish. These date constraints keep activities from moving around in the model, and constrained activities are often part of the critical path.

Along with any fixed calendar constraints, all activities must be given an estimated duration, or the days or weeks needed to finish. An activity may have a long duration, such as putting up building steel or finishing the interior, that may cause the critical path to be affected. Software programs available for critical path method modeling will show when an activity has extended past an estimated time. Activity durations can also affect the critical path if they take longer than an estimated project time allows. These results are summarized in the software report when all data have been inserted.

Another function of critical path method software is determining how people are used. Each activity can have a resource, a person or group, assigned to it. An activity normally includes the resource name and how much of their time as a percentage is needed for the activity. Reports can show when a resource is needed more than they are available; for example, employees that are needed for 150% of their allotted time. These constraints allow project managers to shift resources as needed to prevent under- or over-use of personnel during a project.

Complex projects can have cost estimates included in the CPM report. Activities can be listed with an estimated cost to complete, and any additional cost if the activity is delayed or extends past the due date. Changes in the critical path resulting in delays or project extensions will have a visible effect on total project cost.

Commercial CPM software is often useful because it can easily show changes in the critical path for real-time activity data. When an activity changes by date or duration, a project manager can input changes into the project schedule and immediately see effects on total project and critical path schedules, resources, and costs. A critical path method will provide the most accurate results by regularly inputting data for a project as it continues, and changing activity dates and durations to actual dates and completion times.

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