PROJECT EVALUATION REVIEW

TECHNIQUE (PERT)
 PROJECT EVALUATION REVIEW TECHNIQUE, (PERT)

• In certain projects like research and

development, new product introductions, it is
difficult to estimate the time of various activities.

• In 1958, the special projects office of the US navy

developed the Program Evaluation and Review Technique
(PERT) to plan and control a missile program.

• In the recent time, PERT is a popular management science

techniques that help mangers plan, schedule, monitor, and
control large scale and complex projects
 PERT
 Tool used for Planning, Controlling and Reviewing the progress of
project.

 Being a critical path method, PERT has got similarities with CPM.

 CPM is deterministic technique.

 PERT is probabilistic technique.

 CPM relies on the deterministic or single value estimate

expression of time duration

 PERT is probabilistic in nature as it consider three different

nature of time
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 Three Times
PERT is used in such projects with a probabilistic method using three
time estimates for an activity, rather than a single estimate, as shown in
Figure.
• Optimistic time (to):
• It is the shortest time taken to complete the
activity. It means that if everything goes
well then there is more chance of
completing the activity within this time.
• Most likely time (tm):
• It is the normal time taken to complete an
activity, if the activity were frequently
repeated under the same conditions.
• Pessimistic time (tp):
• It is the longest time that an activity would
take to complete. It is the worst time
estimate that an activity would take if
unexpected problems are faced.
 Taking all these time estimates into consideration, the expected time
of an activity is arrived at.

The average or mean (ta) value of

the activity duration is given by,

The variance of the activity time

is calculated using the formula,

Probability for Project Duration

The probability of completing the

project within the scheduled time (Ts) or
contracted time may be obtained by
using the standard normal deviate
where Te is the expected time of project
completion.
 Time Estimates in PERT

• Earlier expected time (TE): It is time when an event can be

expected to occur.

• Latest Allowable time (TL): The latest time by which an event

must occur to keep the project on schedule is known as latest
allowable occurrence time.

• Slack (S): It can be defined as the difference of time between TL

and TE
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 Time Estimates in PERT (Cont.)

• Positive slack: If TL is more than the TE, it is an indication of

ahead schedule condition, means the work will be completed
earlier than schedule.

• Zero slack: it occurs if TL = TE for an event. It is an indication of

an scheduled condition.

• Negative slack: when TL is less than TE. This indicates the

condition that the work of the project is behind the schedule.

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 Time Estimates in PERT

• Beta distribution curve is used for time estimations in PERT.

• The Beta distribution curve is described by its mean and standard

deviation which are calculated from three estimates of an activity
or job’s duration

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 Properties of Normal Distributions

• The normal curve is bell-shaped and symmetric about the mean.

• The total area under the curve is equal to one.

• The normal curve approaches, but never touches the x-axis as it

extends farther and farther away from the mean.

• Between μ − σ and μ + σ (in the center of the curve), the graph

curves downward. The graph curves upward to the left of μ − σ
and to the right of μ + σ. The points at which the curve changes
from curving upward to curving downward are called the inflection
points.

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11
 Properties of Normal Distributions

• The most important probability distribution in statistics is the

normal distribution.

A normal distribution is a continuous probability distribution for a

random variable, x. The graph of a normal distribution is called the
Normal Curve/Bell Shape. 12
PROBABILITY CONCEPTS

• One standard deviation away from the mean (σ) in either

direction on the horizontal axis accounts for around 68
percent of the data. Two standard deviations away from the
mean accounts for roughly 95 percent of the data with three
standard deviations representing about 99 percent of the
data.
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 Example
An R & D project has a list of tasks to be performed whose time estimates are
given in the Table 8.11, as follows.

a. Draw the project network.

b. Find the critical path.
c. Find the probability that the project is completed in 19 days. If the
probability is less that 20%, find the probability of completing it in 28 days.
d. When the project is expected to be completed, if the probability is 72%?
Time expected for each activity is
calculated using the formula (5):
Similarly, the expected time is
calculated for all the activities.

The variance of activity time is

calculated using the formula (6).
Similarly, variances of all the
activities are calculated.
Solution:
• Expected time of completion of the Project = 24 Days
• Critical Path: B-E-G-J
• Zo(19 Days)= -2.47  Probability= 6.76%
• Zo(28 Days)= ?  Probability= ?%
• Z=? (at 72%)
• No. of Days=?
Example no 2 Draw Arrow Network and perform the PERT calculations
for the following schedule of the Project. Also determine the probability
of completion of the project in 37,50 and 57 Days.
Activity IPA Optimistic Most Pessimistic
Likely
A - 5 6 7
B A 4 5 18
C A 4 15 20
D B 3 4 5
E B, C 5 16 21
F C 10 14 18
G D,E,F 11 15 19
Solution
Activity IPA Optimistic Most Likely Pessimistic Expected Standard Variance
Time Deviation

A - 5 6 7 6 0.33 0.1089
B A 4 5 18 7 2.33 5.428
C A 4 15 20 14 2.67 7.1289
D B 3 4 5 4 0.33 0.1089
E B, C 5 16 21 15 2.67 7.1289
F C 10 14 18 14 1.33 1.7689
G D,E,F 11 15 19 15 1.33 1.7689
Solution:
• Expected Project time = 50 Days
• Critical Activities= A-C-E-G
• Non-Critical Activities= B-D-F
• Z0(37)=-3.23  0.062 %
• Z0(20)=0  50 %
• Zo(57)=1.742= 95.9%
Example no 3 Draw Arrow Network and perform the PERT calculations
for the following schedule of the Project.
Determine probability at 50 days
Activity IPA Optimistic Most Likely Pessimistic

A - 1 2 3
B A 3 6 15
C A 4 10 16
D A 2 4 6
E B 4 7 10
F B,C 3 5 7
G C,D 1 3 11
H E,F 4 5 18
I G,H 1 2 9
Assignment Problems
THANK YOU !