Program Evaluation and Review Technique


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A discussion on the basics of creating a PERT chart

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Program Evaluation and Review Technique

  1. 1. Program Evaluation Review Technique (PERT) Report by: Raymund N. Sanchez
  2. 2. Content of the Presentation <ul><li>Definition </li></ul><ul><li>Differences between PERT & CPM </li></ul><ul><li>Purpose </li></ul><ul><li>Historical Perspective </li></ul><ul><li>Terminologies </li></ul><ul><li>Creating a PERT/CPM diagram </li></ul><ul><li>Schedule Duration Crash </li></ul><ul><li>Probabilistic Time Estimates </li></ul><ul><ul><li>uncertainty of activities and paths </li></ul></ul><ul><ul><li>path probabilities </li></ul></ul><ul><li>Problem Exercises </li></ul>
  3. 3. Definition <ul><li>A method to analyze the tasks involved in completing a given project. </li></ul><ul><li>Focus is paid to the time needed to complete each task, and identifying the minimum time needed to complete the total project. </li></ul>
  4. 4. Purpose <ul><li>To simplify the planning and scheduling of large and complex projects. </li></ul><ul><li>To incorporate uncertainty in the sense that it was possible to schedule a project not knowing precisely the details and duration's of all the activities. </li></ul><ul><li>Event-oriented technique rather than start- and completion-oriented. </li></ul><ul><li>Used more in R&D-type projects where Cost is not a major factor but Time is. </li></ul>
  5. 5. PERT & CPM Similarities <ul><li>Both follow the same steps and use network diagrams </li></ul><ul><li>Both are used to plan the scheduling of individual activities that make up a project </li></ul><ul><li>They can be used to determine the earliest/latest start and finish times for each activity </li></ul>
  6. 6. PERT & CPM Differences <ul><li>PERT is probabilistic whereas CPM is deterministic </li></ul><ul><li>In CPM, estimates of activity duration are based on historical data </li></ul><ul><li>In PERT, estimates are uncertain and we talk of ranges of duration and the probability that an activity duration will fall into that range </li></ul><ul><li>CPM concentrates on Time/Cost trade off. </li></ul>
  7. 7. Historical Background <ul><li>PERT was invented by Booz Allen Hamilton, Inc. under contract to the United States Department of Defense's US Navy Special Projects Office in 1958 </li></ul><ul><li>A part of the Polaris mobile submarine-launched ballistic missile project. This project was a direct response to the Sputnik crisis </li></ul><ul><li>CPM was developed by the dupont company & Remington-Rand-Univac </li></ul><ul><li>Used for large construction projects </li></ul><ul><li>Each were unaware of the others existence until the 1960’s </li></ul>
  8. 8. Terminologies <ul><li>PERT event : is a point that marks the start or completion of one (or more) tasks. It consumes no time , and uses no resources . It marks the completion of one (or more) tasks. It is not “reached” until all of the activities leading to that event have been completed. </li></ul><ul><li>P redecessor event : an event (or events) that immediately precedes some other event without any other events intervening. It may be the consequence of more than one activity. </li></ul><ul><li>Successor event : an event (or events) that immediately follows some other event without any other events intervening. It may be the consequence of more than one activity. </li></ul>
  9. 9. Terminologies <ul><li>PERT activity : is the actual performance of a task. It consumes time , it requires resources (such as labor, materials, space, machinery), and it can be understood as representing the time, effort, and resources required to move from one event to another. A PERT activity cannot be completed until the event preceding it has occurred. </li></ul><ul><li>Optimistic time (O): the minimum possible time required to accomplish a task, assuming everything proceeds better than is normally expected </li></ul><ul><li>Pessimistic time (P): the maximum possible time required to accomplish a task, assuming everything goes wrong (but excluding major catastrophes). </li></ul>
  10. 10. Terminologies <ul><li>Most likely time (M): the best estimate of the time required to accomplish a task, assuming everything proceeds as normal. </li></ul><ul><li>Expected time (T E ): the best estimate of the time required to accomplish a task, assuming everything proceeds as normal (the implication being that the expected time is the average time the task would require if the task were repeated on a number of occasions over an extended period of time). </li></ul><ul><li>Critical Path : the longest possible continuous pathway taken from the initial event to the terminal event. It determines the total calendar time required for the project; and, therefore, any time delays along the critical path will delay the reaching of the terminal event by at least the same amount. </li></ul>
  11. 11. Terminologies <ul><li>Lead time : the time by which a predecessor event must be completed in order to allow sufficient time for the activities that must elapse before a specific PERT event is reached to be completed. </li></ul><ul><li>Lag time : the earliest time by which a successor event can follow a specific PERT event. </li></ul><ul><li>Slack : the slack of an event is a measure of the excess time and resources available in achieving this event. Positive slack would indicate ahead of schedule ; negative slack would indicate behind schedule ; and zero slack would indicate on schedule . </li></ul>
  12. 12. Terminologies <ul><li>Early Start (ES): maximum EF of all predecessor activities, unless the activity in question is the the first activity, wherein ES is 0 </li></ul><ul><li>Early Finish (EF): ES plus task duration </li></ul><ul><li>Late Start (LS): LF minus task duration </li></ul><ul><li>Late Finish (LF): minimum LS on all successor activities, unless the activity is the last activity, wherein LF equals EF </li></ul><ul><li>Activity on Arrow (AOA): a type of PERT diagram wherein the activities are written on the arrows </li></ul><ul><li>Activity on Node (AON): a type of PERT diagram wherein the activities are written on the nodes </li></ul>
  13. 13. Creating a PERT Diagram <ul><li>STEPS 1: </li></ul><ul><li>Determine the tasks that the project requires and the order in which they must be completed </li></ul><ul><li>Determine the optimistic, most likely, and pessimistic time of each task </li></ul><ul><li>Compute for the Expected time using the formula </li></ul><ul><li>Te=(O+4M+P)/6 </li></ul><ul><li>Determine whether to use AOA or AON diagrams </li></ul>
  14. 15. Start F C G E D B A Finish
  15. 16. Creating a PERT Diagram <ul><li>STEPS 2: </li></ul><ul><li>Determine the ES & EF of each activity by: </li></ul><ul><ul><li>Start at the beginning moving towards the end </li></ul></ul><ul><ul><li>ES & EF for the start activity is always 0 since they are milestones </li></ul></ul><ul><ul><li>Use the EF of the predecessor activity as the ES of the current activity </li></ul></ul><ul><ul><li>EF of an activity is computed by adding its ES with its duration </li></ul></ul><ul><ul><li>For activities with 2 or more predecessor activities, use the predecessor with the higher EF as the ES of the current activity </li></ul></ul>
  16. 17. Start ES:0 EF:0 F D:4.5 ES:10.33 EF:14.83 C D:5.17 ES:4 EF:9.17 G D:5.17 ES:14.34 EF:19.51 E D:5.17 ES:9.17 EF:14.34 D D:6.33 ES:4 EF:10.33 B D:5.33 ES:0 EF:5.33 A D:4 ES:0 EF:4 Finish D:0 ES:19.51 EF:19.51
  17. 18. Creating a PERT Diagram <ul><li>STEPS 3: </li></ul><ul><li>Determine the LS & LF of each activity by: </li></ul><ul><ul><li>Start at the end and work towards the beginning </li></ul></ul><ul><ul><li>The LF for the finish activity is equal to EF since it is the last activity in the project. Since duration is 0, LS is equal to LF </li></ul></ul><ul><ul><li>Use the LS of the successor activity as the LF of the current activity </li></ul></ul><ul><ul><li>LS of an activity is computed by subtracting its LF with its duration </li></ul></ul><ul><ul><li>For activities with 2 or more successor activities, use the successor with the lower LS as the LF of the current activity </li></ul></ul>
  18. 19. Start D:0 ES:0 EF:0 LS:0 LF:0 F D:4.5 ES:10.33 EF:14.83 LS:15.01 LF:19.51 C D:5.17 ES:4 EF:9.17 LS:4 LF:9.17 G D:5.17 ES:14.34 EF:19.51 LS:14.34 LF:19.51 E D:5.17 ES:9.17 EF:14.34 LS:9.17 LF:14.34 D D:6.33 ES:4 EF:10.33 LS:8.68 LF:15.01 B D:5.33 ES:0 EF:5.33 LS:3.84 LF:9.17 A D:4 ES:0 EF:4 LS:0 LF:4 Finish D:0 ES:19.51 EF:19.51 LS:19.51 LF:19.51
  19. 20. Creating a PERT Diagram <ul><li>STEPS 4: </li></ul><ul><li>Compute for the critical path by adding the duration's of various paths for all activities </li></ul><ul><li>Determine if any activities have slack by subtracting the activity’s LF & EF </li></ul>
  20. 21. Critical Path <ul><li>Critical Path: A-C-E-G </li></ul><ul><li>Path A-D-F = 14.83 work days </li></ul><ul><li>Path A-C-E-G = 19.51 work days </li></ul><ul><li>Path B-E-G = 15.67 work days </li></ul>
  21. 22. Slack
  22. 23. Gantt Chart
  23. 24. Schedule Duration Crash <ul><li>Crash : an effort to reduce the overall time duration of a project by employing one or all of the following techniques </li></ul><ul><ul><li>Adding resources (human or otherwise) </li></ul></ul><ul><ul><li>Increasing work hours (overtime or weekends) </li></ul></ul><ul><ul><li>Lessening quality </li></ul></ul><ul><li>A trade-off between shorter task duration and higher task costs </li></ul><ul><li>If the cost savings on a delay penalty are higher than the incremental cost of reducing the project duration, then the crashing is justified. </li></ul>
  24. 25. Activity Uncertainty <ul><li>Standard Deviation of an activity is estimated as one sixth of the difference between the pessimistic and optimistic time estimates </li></ul><ul><li>Variance is determined by squaring the standard deviation </li></ul><ul><li>The size of the variance reflects the degree of uncertainty associated with the activity’s time. The larger the variance, the greater the uncertainty. </li></ul><ul><li>Standard Deviation = t p - t o </li></ul><ul><li> 6 </li></ul>
  25. 26. Path Uncertainty <ul><li>Standard Deviation of a path can also be computed to know the uncertainty of a particular path. </li></ul><ul><li>SD of Path=  variances of activities on a path </li></ul>
  26. 27. Path Probability <ul><li>The probability that a given path will be completed in a specified length of time can be determined using the following formula: </li></ul><ul><li>Z = Specified Time - Path Mean </li></ul><ul><li> Path Standard Deviation </li></ul><ul><li>If the value of Z is 2.50 more, treat the path probability as 100%. If the value of Z is less than 2.50, use the table of values under the standardized normal curve. </li></ul>
  27. 28. Sample Problem
  28. 29. - END -