Program Evaluation &

Review Technique
A Simple Guide to Network Models
 Program Evaluation & Review Technique

• Based on the assumption that an activity’s

duration follows a probability distribution
instead of being a single value

• Three times estimates are required to

compute the parameters of an activity’s
duration distribution
Program Evaluation & Review Technique
• Tries to account for the uncertainty in task
durations

• A stochastic approach which considers the

uncertain nature of the project activities by
estimating the expected duration of each activity
and its corresponding variance

• Key question: What is the probability of

completing the project by a given deadline?
optimistic time (a) = shortest possible time in which
activity could possibly be completed

Most likely time (m) = means the time required if the

execution is normal

Pessimistic time (b) = longest time the activity could

ever require
 Program Evaluation & Review Technique

1. Draw the network diagram.

2. Find critical path.
3. The length of critical path is the mean of the project duration
probability distribution assumed to be normal.
4. Compute for the standard deviation by adding all variances
of the critical path and obtain the square root of the sum.
5. Compute for the probability.
Program Evaluation & Review Technique
 Shopping Mall Renovation
Activity Description IP Optimistic Most likely Pessimistic
A Prepare initial design - 1 3 5
B Identify new potential clients - 4 5 12
Develop prospectus for
C tenants A 2 3 10

D Prepare final design A 1 8 9

E Obtain planning permission D 1 2 3
F Obtain finance from bank E 1 3 5
G Select contractor D 2 4 6
H Construction G, F 10 17 18
I Finalize tenants contracts B, C, E 6 13 14
J Tenants move in I, H 1 2 3
 Shopping Mall Renovation

1. Draw the Network Diagram

2. What is the critical path?
3. What is the total duration of the project?
4. What is the probability that the project will be done in 36
weeks?