Program Evaluation Review Technique (PERT)

and its applications in Project Management

Submitted to:

Dr. Subhajit Bhattacharya

Submitted By-

Clayburn Calvert(26)
Shruti Mishra(27)
Amrit Mohanty(28)
Amit Raj(29)
Ravi Sunkara(30)
Objective of the presentation

• To understand the formula, the application and the benefits

of Program, Evaluation, and Review Technique (PERT)
analysis in Project Management.

What is PERT ?
Program (Project) Evaluation and Review Technique (PERT): is a
project management tool used to schedule, organize, and coordinate
tasks within a project. It is basically a method to analyse the tasks
involved in completing a given project, especially the time needed
to complete each task, and to identify the minimum time needed to
complete the total project.
Uses Of PERT in our daily lives

• PERT is used when activity times are uncertain.

• In many instances , managers have attempted to apply PERT

principles to other types of projects including:

 Hospital planning for such issues as costs and social security.

 Educational planning and development.
 Various Accounting Functions.
 Real Estate Development.
 PERT and Computer Project-Scheduling Software.
Uses Of PERT in our daily lives
Examples when PERT technique is used-
• A company decides to increase its production capacity by building a new
production unit . The project consists of separate tasks, some of which cannot
be started before others are completed. Thus PERT helps in listing the
activities along with the time expected for each activity.
• A company decides to launch a new product in the market. It requires several
steps. Some of these steps cannot begin until the others are completed. Thus
PERT helps in estimation of completion time and how much delay is possible
in the project completion.

PERT is applied to:

• Very large-scale
• One time
• Complex
• Non-routine infrastructure
• Research and Development Projects
Determine the duration of the project
Three time estimates are required to compute the parameters of an
activity’s duration distribution:

• OPTIMISTIC TIME: Best time if everything goes perfectly

• REALISTIC TIME: Most likely time
• PESSIMISTIC TIME: A worst-case situation
B + 4M + P
Expected Time = -------------------
6
Example:
Expected time for Excavation activity if B=12, M=18, P=60,

12 + 4(18) + 60
Expected Time = -------------------------
6
= 24 days
Determine the critical path

The critical path is

•Determined by adding the times for the activities in each sequence.
•Determining the longest path in the project.

The critical path determines the total calendar time required for the project. If
activities outside the critical path speed up or slow down (within limits), the
total project time does not change.

The amount of time that a non–critical path activity can be delayed without the
project is referred to as a slack time.
Project Crashing
Critical Path is helpful to determine
ES – Earliest Start time
EF - Earliest Finish time
LS – Latest Start time
LF - Latest Finish time
The project can be accelerated by adding the resources required to decrease the
time for the activities in the critical path.
Shortening of the project sometimes is referred to as Project Crashing.

•Make adjustments in the PERT chart as the project progresses.

•As the project unfolds, the estimated times can be replaced
with actual times.
In cases where
There are delays,
Additional resources may be needed to stay on schedule
The PERT chart may be modified to reflect the new situation.
Activity Crashing and Time-Cost Relationship

Crash cost
Crashing activity

Slope = crash cost per unit time

Normal Activity
Normal
cost
Normal
time

Crash time Activity time

Activity Crashing and Time-Cost Relationship
Time-Cost Relationship
 Crashing costs increase as project duration decreases
 Indirect costs increase as project duration increases
 Reduce project length as long as crashing costs are less than indirect costs
Time-Cost Tradeoff
Min total cost = Total project cost
optimal project time
Indirect cost

Direct cost

time
CASE STUDY

Analysis and Implementation of PERT in the Building of an

Aircraft
CASE STUDY
 CONCLUSION

Organizations and the world in which they operate continue to

become more complex. Huge numbers of choices and relentless
time pressures and margin pressures make the decisions you face
more daunting and more difficult. Meanwhile, new enterprise
applications and software are generating massive amounts of data –
and it can seem like an overwhelming task to turn that data into
insight and answers.
But all that data and the availability of more and cheaper computing
power are creating an important opportunity for decision makers.
•O.R. is ideally designed to help you take advantage of. PERT.
•Professionals thrive on challenges that involve large numbers of
variables, complex systems, and significant risks.
As a result, PERT can help today’s executives with many of the
specific challenges.