Critical path method: This was devised by researchers at DuPont and Remington-Rand to manage the complex business of shutting down plants for maintenance and then restarting them. CPM begins by providing a diagramatic view of the project, showing the time required to complete each of its component activities. The diagram will then reveal which activities are critical to keeping the project on schedule— and which are not. It works like this:

1. Define the individual activities.
2. List them in the order they must be performed—some can’t be started until others have been
   completed
3. Create an activity diagram or flowchart showing each activity in relation to the others.
4. Estimate the time needed to carry out each activity.
5. Identify the critical path. This is the route through the network—the diagram—that will take the
   longest amount of time. None of the activities lying along this path can be delayed without delaying
   the entire project.

Tasks which are not on the critical path can fall behind schedule—up to a point—without blowing the whole project’s completion date. This leeway for slippage in non-critical activities is called “slack” or “float.” The activities on the critical path have no slack at all. It often happens that the activity diagram reveals more than one critical path—in fact, project managers like to say that the perfectly balanced project is all critical path. Armed with a CPM diagram, project managers know how long their complex
project will take to complete, and which tasks are absolutely vital to staying on schedule. In the diagram the critical path is task 1, followed by task 3 and then task 5. This gives three days’ slack in the path of task 2, followed by task 4 and then task 5.

Having identified the critical path, if project managers then add in information about the cost of each activity, and the cost of speeding up each activity, they can decide whether it is worth trying to accelerate the project—and, if so, what the optimal plan might be. That all sounds promising, but CPM does have its limitations. It is a deterministic model in the sense that its outcome is predetermined by the values fed into it—in this case, the completion times of critical tasks. Change those and you change the outcome. This means that, while CPM can cope with complexity, it is best suited to routine projects with predictable completion times.

Tyranny of the Triangle

Projects always have constraints, and there are three major ones, forming a triangle—the “project management triangle.” You can’t change one side of the triangle without having an effect on the other two. The three constraints are:

Time—the hardest to control
Cost—soars when time is all-important
Scope—what the project is supposed to accomplish

Juggling all three is not easy. As the cynics say: “Pick two—good, fast or cheap.

Source: 50 Management Ideas You Really Need to Know