PERT Charts

Prepared by: Michael Palazzo

What are PERT Charts?OPERT stands for Program

Evaluation and Review Technique

OTo understand what a PERT chart is, we must first learn the Critical Path Method (CPM)

CPMODeveloped as a network model

for project managementOUses a fixed time estimate for

each activityOEasy to understand but does

not account for time variations of activities

What is PERT?ODeveloped in late 1950’s

OA network model that allows for randomness in activity completion times

OHas potential to reduce time and cost to complete a project

Network DiagramsOPERT Charts use network diagrams

OActivities and milestones of a project are represented by arcs and nodes on a model

OPERT was originally Activity-on-Arc diagram

OSome now use Activity-on-Node

Arc vs. NodeActivity-on-

arc network:

Activity-on-node network:

Example of a PERT Chart

6 Steps1. Identify

2. Determine Activity Sequence

3. Construct

4. Estimate5. Determine

Critical Path

6. Update

Identify/Determine Activity Sequence

O Identify Activities and Milestones:O Activities are tasksO Milestones mark beginning and end

of activities

ODetermine Activity Sequence:O Sequence is evident for someO Others require more analysis

ConstructOConstruct the Network Diagram:

O Create diagram with activity sequence info

O For activity-on-arc model, activities are arrowed lines and milestones are circles

O Software exists to simplify this step

EstimateOEstimate Activity Times:

O Weeks are commonly used as unit of time

O PERT is able to deal with uncertainty in activity completion times

O Each activity in model includes three time estimates

Estimate Continued…OOptimistic Time:

O Shortest time activity can be completed

OMost Likely Time:O Completion time with highest probability

OPessimistic Time:O Longest time the activity might require

Determine Critical PathOCritical path is longest path in

project

ODetermined by adding the times for activities in each sequence

OBy accelerating activities on critical path you decrease total project time

UpdateOUpdate as Project Progresses:

O Make adjustments to PERT chart as project continues

O Resources may need to be added to stay on schedule if there are delays

Benefits of PERTOGives expected project

completion time

OProvides probability of completion before a date

OShows critical path activities

Benefits Continued…

OProvides activity start and end dates

OShows activities that have slack time

Limitations of PERTOThe activity time estimates

are subjective

OPERT assumes a beta distribution for its time estimates; actual distribution may be different

Limitations Continued…

OConsistently underestimates the expected project completion timeO PERT assumes probability distribution

of project completion time is same as critical path

O If delayed, other paths can become critical path

ReferencesO Pert Charts:

http://www.netmba.com/operations/project/pert/

O More Information on CPM/CPA:http://www.mindtools.com/critpath.html

O PERT Chart Images:http://en.wikipedia.org/wiki/Program_Evaluation_and_Review_Technique

http://cpmtutor.com/c05/fp-dummies.htmlhttp://cnx.org/content/m32170/latest/

Thank you for your attention!