Time Management

Programme Evaluation and Review Technique

(PERT)
 Content for Today

Concept of Programme Evaluation and Review

Techniques

 Problems

 Tutorial
 Programming

• The CPM approach so far are:

– Precedence or activity on node (AON)
– Activity on arrow (AOA)

• However these methods are purely deterministic in nature (i.e. They depend
only on a single value measurement of time for an activity)

• But life is not so predictable, when we have all these other variables, like
variation of workers competency, financial concerns, weather patterns, and
the economic market to contend with – i.e. Uncertainty and risk sets in on
the project.

• Hence we need a better Predictor of time that takes into account all the
other variables, this method is better than the deterministic CPM which is
the Programme Evaluation and Review Technique (PERT)
 Background
• Developed during the Polaris project in the
1950’s

• PERT reviews the uncertainty or risk in project

evaluation when it is common to expect
variations in the duration of the project
activities

• PERT describes uncertainty in quantitative

terms
 PERT Programming

• Usually used on large projects that a precedence is required, but

none exist

• PERT deals with uncertainties through statistical distribution

functions

• Statistical distribution tend to forecast a more reliable variability or

uncertainties than a single value choice
 Conti…

• Just because your project’s critical path

provides you with a value for the project’s
duration, how certain are you that the
project will be completed on that date?
 Statistical Appraisal of
Project Data

• In Critical Path Analysis uncertainty is not considered,

viz. the optimistic and pessimistic durations with the
most likely duration

• PERT seeks to address this problem by the assessment

of the expected duration, the standard deviation and thus
determine the probability from statistical data

• Probability data will range from: 0 = improbable, to 1

definite certainty or can be express as a percentage
Statistical Appraisal of Project Data

• Time (i.e. Duration) for each activity is not represented

this time by the normal distribution

• For each activity the duration for a sample of field data

will fit a so called ‘beta’ distribution

• The distribution is usually skewed to the pessimistic or

longer durations
 Conti…

• The Beta distribution is characterised by:

– a - the optimistic duration,
– m - the most likely (most common) duration,
and
– b - the pessimistic duration

• Both ‘a’ and ‘b’ are expressed in 1 in 100 probabilities or

between 0 to 1 in numbers.
 Conti…

• In the beta distribution the m value is weighted

to 4 in order to represent the distribution

• Both ‘a’ and ‘b’ are weighted at 1 unit

• The Beta curve is therefore divided into 3

portions [‘a’, ‘m’ and ‘b’] which allows for an
estimate and standard deviation to be
determined
The Beta Distribution

a m b
• The estimated duration for each activity is thus:
te = (a + 4m + b)
6

• Usually the value of te is expressed to one decimal place

• Essentially, te is less likely if ‘a’ and ‘b’ differ greatly

• The standard deviation for an activity is thus:

S = (a - b)
6
• The overall project duration is thus calculated from
the te values determined for each of the critical path
activities

• The overall standard deviation is obtained from the

root of the sum of the square of each activity
standard deviation on the critical path, where:

σ = (s12 + s22 + s32 + .....sn-12 + sn2 )0.5

Where n represents the total number of activities on

the critical path
• Using the overall estimated duration te
and the overall standard deviation, an
assessment of the estimated project
duration can be attained

• Assuming the overall project conforms

to a normal probability distribution,
standard theory can be applied to
determine the probability of completing
(or not completing) the project within a
certain specified time limit
• This is usually determined from standard probability
tables

• Such tables are based about a zero or datum point

which makes the mean value "0”

• To achieve this a z or t score is determined, wherein:

z = (T - Tm)
σ
– Where Tm is the mean project completion duration (=Σte) – in short critical path times

– Where б is the variance of project completion time

Standard Distribution for the
Overall Duration
 Worked example 1

• The objective is to determine the

probability of completing the project shown
overleaf within a target time of 33 weeks.
(Addendum) 4 6 1 1 1
 Solution to example 1

1. Determine the estimated duration te for each activity to

one decimal place

2. Use this value as the duration for each activity on the

network

3. Determine the critical path and the overall project

duration (i.e. Tm = Σte )

4. Identify the critical activities and determine their

standard deviation (s) to two decimal places
 Solution to example 1.

5. Determine the overall standard deviation for the critical

path (σ)

6. Determine the Z score for the project using T (target

time), Tm (critical path time) and σ (standard deviation
of the critical path)

7. Using probability tables determine the probability of

success
(Addendum) 4 6 1 1 1 1
Example 2. for you to solve
Example 3. for you to solve

?
 Conclusions

• Easy comparison of planning evaluation for practitioners

within a project and also between projects

• Eliminate the need of having to structure information

according to specific needs or practice of practitioners

• Flexibility

• Majority of the time it enhances increase in the firm's

productivity