PROGRAMME EVALUATION

AND REVIEW TECHNIQUE

(PERT)
Dr. M. Vijaya Kini,
Associate Professor (Sr. Scale),
Department of Mechanical and Manufacturing Engineering,
mvkini@yahoo.com

INTRODUCTION
In the analysis done so far, the scheduling times
of various activities, the critical path, and the
project length were all determined on the basis
of activity times which were assumed to be
known and constant.
This assumption holds good for CPM analysis,
but according to the originators of PERT, any
given activity delineated in a network is unlikely
to be completed on time.
Sometimes all aspects of a job may be easier to
complete than expected, while at other times,
unexpected snags may occur, causing unplanned
delays.
This method uses three time estimates for an
activity, rather than a single estimate.

They are:
1) Optimistic time (a): This is the shortest time
the activity can take to complete. There is
more than one chance in a hundred of
completing the activity in this amount of
time. It represents an ideal estimate.
2) Most likely time (m): This refers to the time
that would be expected to occur most often if
the activity were frequently repeated under
exactly the same conditions. It is the modal
time.
3) Pessimistic time (b): This is the longest time
the activity could take to finish. It is the
worst time estimate and represents the time
the activity would take if bad luck was faced.
It occurs with a probability of less than one
per cent.
Depending on the values of a, m, and b, the
resulting distribution of activity duration can
take a variety of forms.
Typically, completion of a given activity is
assumed to follow beta distribution.

P
r
o
b
a
b
i
l
i
t
y

a

=

O
p
t
i
m
i
s
t
i
c

t
i
m
e

m

=

M
o
s
t

l
i
k
e
l
y


t
i
m
e

t
e
i

=

E
x
p
e
c
t
e
d

t
i
m
e

b

=

P
e
s
s
i
m
i
s
t
i
c


t
i
m
e

Beta Curve
TIME DURATION OF
AN ACTIVITY
Using the values of a, m, and b, the expected
times of various activities and their standard
deviations are calculated .
The three time estimates are reduced into a
single expected time (t
ei
) with the weighted
average formula
4
6
ei
a m b
t
+ +
=
The standard deviation,
i
, of the
completion time of an activity is calculated as
6
i
b a

=
2
2
From this the varia
6
nce
i
b a

=


Project duration and Variance
Once the expected times of the activities are
obtained, the critical path of the project network
is determined using these time estimates.
Aggregation of the mean times = Project
duration.

Summation of variances = Project variance.

An assumption invoked is that of the Central
Limit Theorem which states that the sum of
several independent activity duration will tend
to be normally distributed,
with a mean equal to the sum of their
individual job times
and
the variance equal to the sum of their
individual activity variances.

Accordingly, the probability distribution of
times for completing a project can be
approximated by using a normal distribution
curve which becomes more exact as the number
of activities increases.
For a given project, if the critical activities are
1,2,3,..k, we have,

1 2 3
2 2 2 2 2
1 2 3
................

.............
e e e e ek
T T k
T t t t t
and
V or
= + + + +
= + + + +
Points to remember
1) If there are two (or more) critical paths in a
given network, then the one with the largest
variance should be used for determining T
e

and V
T
.
2) The probability calculations mentioned
above represent only the probability of
completing the activities on the critical path,
and the activities on the other critical path
(if it exists) and the non-critical path(s) are
ignored.
Points to remember
3) PERT is based on the assumption that the
critical path is fixed and given once and for
all, which is wrong in principle.
Difference between CPM and PERT
PREPARE ON YOU OWN!
(Note: You should be able to list at least 6
differences.)
The owner of a chain of fast-food restaurants is
considering a new computer system for accounting
and inventory control. A computer company sent the
following information about the system installation.

Activity
identification

Immediate
predecessor
Time
Most
Optimistic
Most
Likely
Most
Pessimistic
A ----- 4 6 8
B A 5 7 15
C A 4 8 12
D B 15 20 25
E B 10 18 26
F C 8 9 16
G E 4 8 12
H D,F 1 2 3
I G,H 6 7 8
a) Construct an arrow diagram for this problem, determine the
critical path and state the expected project completion time.

b) Determine the probability that the project will be completed in
55 days.

c) If the Company wants to be 90% sure that the system will be
installed by a certain due date, how many days prior to that
should it start the work?

d) Suppose the company agrees to install the computer system in
50 days, failing which it would pay a penalty of ` 500 per day.
What is the probability that a penalty, but not exceeding ` 2000,
will be paid?

e) Obtain in earliest and latest scheduling times of the various
activities.


Activity
identification

Immediate
predecessor
Time
t
ij

Most
Optimistic
Most
Likely
Most
Pessimisti
c
A ----- 4 6 8 6 4/6 4/9
B A 5 7 15 8 10/6 25/9
C A 4 8 12 8 8/6 16/9
D B 15 20 25 20 10/6 25/9
E B 10 18 26 18 16/6 64/9
F C 8 9 16 10 8/6 16/9
G E 4 8 12 8 8/6 16/9
H D,F 1 2 3 2 2/6 1/9
I G,H 6 7 8 7 2/6 1/9
6
i
b a

=
2
i

1 2
3
4
6
5
7
8
A
6
H
2
E
18
I
7
A-B-E-G-I = 47
A-B-D-H-I = 43
A-C-F-H-I = 33
CRITICAL PATH = A-B-E-G-I = 47
VARIANCE
2
= 4/9 +25/9+64/9+16/9+1/9 =110/9
2
47
110/ 9 3.496
days
days

=
= = =
NORMAL
DEVIATE (Z)
2
s e
CP
T T
Z

=
55 47
2.29
3.496
Z

= =
From Normal Tables for
Z= 2.29, prob. = 0.9890
Thus required probability
= 98.9%
To determine value X (days before which to start
with 90% prob.)
For Prob 90% i.e. 0.90, from Normal Tables
Z= 1.28 (0.8997) or (1.29) 0.9015
Z = 1.28 (because it closer to 0.9)
47
1.28 2.29
3.496
51.47 52 days
X
X

= =
=
A penalty would be paid if the project is not completed in 50 days. For a penalty to
be paid but not exceeding a sum of ` 2000, the project would be complete
between 50 and 54 days. The prob. Of this would be:
AREA
0.4772
0.3051
Required Area 0.1721
1
54 47
2.00
3.496
z

= =
2
50 47
0.86
3.496
z

= =
Thus, the prob. That a penalty would be paid
but not more than ` 2000 = 0.1721
Activity Expected time ES EF LS LF
A 6 0 6 0 6
B 8 6 14 6 14
C 8 6 14 20 28
D 20 14 34 18 38
E 18 14 32 14 32
F 10 14 24 28 38
G 8 32 40 32 40
H 2 34 36 38 40
I 7 40 47 40 47
As a Project Manager of Quick Construction Company,
you are involved in drawing a PERT network for laying
the foundation of a new art museum. The relevant
information for all the activities of this project is given in
the following table.
Activity
Time estimates
(Weeks)
Normal cost
for expected
duration (`)
Crash
cost (`)
Immedi
ate
Predece
ssor(s)
a b m
A 2 4 3 6000 8000 -----
B 4 6 5 12000 13000 A
C 3 7 5 16000 22000 A
D 2 6 4 8000 10000 A
E 1 3 2 6000 7500 C,D
F 1 5 3 14000 20000 B,E
a) Construct the PERT network for the project and
determine the critical path and the expected duration
of the project.
b) The Director of your company is not impressed with
you PERT analysis. She says that the project must be
completed within seven weeks and refers to the
penalty clause in the agreement that provides for
payment of penalty at the rate of ` 2500 for every
week, or part thereof, exceeding seven weeks. Your
Director also strongly believes that the time duration
of various activities of the project can be crashed to
their optimistic time estimates with the crashing costs
mentioned in the above table. Determine the optimal
duration of the project if your objective is to minimise
the sum of the project execution cost and penalty cost.
A small project consisting of eight activities has the
following characteristics:
Activity
Immediatel
y
preceding
activity
Time estimates (Weeks)
Most
optimistic
Most likely
Most
pessimistic
A ----- 2 4 12
B ----- 10 12 26
C A 8 9 10
D A 10 15 20
E A 7 7.5 11
F B,C 9 9 9
G D 3 3.5 7

a) Draw the PERT network.

b) Find out the critical path and the expected
project completion time.

c) If a 30-week deadline is imposed, what is the
probability that the project will be finished
within the time limit?