Program Evaluation & Review Technique (PERT)

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This presentation explains the Basics of PERT along with numerical illustrations.

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Program Evaluation & Review Technique (PERT):

Program Evaluation & Review Technique (PERT) Presented by: Anupam Kumar Reader School of Management Sciences, Varanasi Email: anupamkr@gmail.com

Program Evaluation & Review Technique (PERT):

Program Evaluation & Review Technique (PERT) PERT was developed by the US Navy for the planning and control of the Polaris missile program The emphasis of PERT is on completing the program in the shortest possible time. PERT has the ability to cope with uncertain activity completion times. e.g. for a particular activity the most likely completion time is 4 weeks but it could be anywhere between 3 weeks and 8 weeks.

Program Evaluation & Review Technique (PERT):

Program Evaluation & Review Technique (PERT) In PERT activities are shown as a network of precedence relationships using activity-on-arrow network construction PERT is used in Project management for non-repetitive jobs (research and development work), where the time and cost estimates tend to be quite uncertain. This technique uses probabilistic time estimates. PERT has Multiple time estimates Probabilistic activity times

PERT:

PERT The procedure of PERT takes into consideration the following time estimates: T e = Expected activity time T o = Optimistic time T p = Pessimistic time T m = Most likely time σ = Event Standard Deviation T e = (T o + 4T m + T p ) / 6 σ = (T p - T o ) / 6

Illustration 1:

Illustration 1 Project planners have sought the judgment of various knowledgeable engineers, foremen and vendors and have developed the time estimate as follows . Determine the critical path. What is the probability the project will be finished within 4 years? Calculate the overall variance for the project schedule. Hint

Illustration 1 (Contd.):

Illustration 1 ( Contd. ) Activity Time Estimate Description Number T o T m T p Design Plant 1 – 2 10 12 16 Select Site 2 – 3 2 8 36 Select Vendor 2 – 4 1 4 5 Select Personnel 2 – 6 2 3 4 Prepare Site 3 – 5 8 12 20 Manufacture Generator 4 – 5 15 18 30 Prepare Manual 4 – 6 3 5 8 Install Generator 5 – 7 2 4 8 Train Operator 6 – 7 6 9 12 License Plant 7 – 8 4 6 14

Illustration 1 (Soln.):

Illustration 1 (Soln.) Activity Time Estimate Description Number T o T m T p T e σ 2 Design Plant 1 – 2 10 12 16 12.33 1 Select Site 2 – 3 2 8 36 11.67 32.11 Select Vendor 2 – 4 1 4 5 3.67 0.44 Select Personnel 2 – 6 2 3 4 3 0.11 Prepare Site 3 – 5 8 12 20 12.67 4 Manufacture Generator 4 – 5 15 18 30 19.5 6.25 Prepare Manual 4 – 6 3 5 8 5.17 0.694 Install Generator 5 – 7 2 4 8 4.33 1 Train Operator 6 – 7 6 9 12 9 1 License Plant 7 – 8 4 6 14 7 2.78

PERT:

PERT The procedure of PERT takes into consideration the following time estimates: T e = Expected activity time T o = Optimistic time T p = Pessimistic time T m = Most likely time σ = Event Standard Deviation T e = (T o + 4T m + T p ) / 6 σ = (T p - T o ) / 6 Z = (T x - T e ) / σ Based on the value of Z, one can find the probability of the project getting completed at any time. If T x < T e then value is the probability else probability is (0.5 – P(Z))

PERT / CPM:

PERT / CPM Benefits Useful at many stages of project management Mathematically simple Give critical path and slack time Provide project documentation Useful in monitoring costs Questions that are answered Completion date? On Schedule? Within Budget? Critical Activities? How can the project be finished early at the least cost?

Limitation of PERT / CPM:

Limitation of PERT / CPM The procedures of PERT / CPM can be applied only for activities which are clearly defined, independent and stable. The activities should have specified precedence relationships. The procedure lays over emphasis on critical paths.

For further details…:

For further details… Contact: Anupam Kumar Reader School of Management Sciences, Varanasi Email: anupamkr@gmail.com 11 © Copyright 2013 Anupam Kumar

Bibliography:

Bibliography Buffa , E.S. and Sarin , R.K., “Modern Production/Operations Management,” Eighth Edition. Singapore: John Wiley & Sons (Asia). 1994. Martinich , J.S., “Production and Operations Management: An Applied Approach”, Singapore: John Wiley & Sons (Asia), 2003. Badi , R.V. and Badi , N.V., “Production and Operations Management”, Second Edition, New Delhi: Vrinda Publication, 2008. Chary, S.N., “Productions and Operations Management,” Third Edition, New Delhi: Tata McGraw Hill, 2004 Goel , B.S., “Production Operations Management”, Twenty Second Edition, Meerut, U.P.: Pragati Prakashan , 2010. Kachru , U. “Production and Operations Management: Text and Cases,” New Delhi: Excel Books, 2007. Rama Murthy, P., “Production and Operations Management,” New Delhi: New Age International, 2012. Chunawalla , S.A., and Patel, D.R., “Production and Operations Management,” Mumbai: Himalaya Publishing House, 2006. Jauhari , V. and Dutta , K., “Services: Marketing Operations and Management,” New Delhi: Oxford University Press, 2010. Verma , H.V., “Services Marketing: Text and Cases,” New Delhi: Dorling Kindersley, Pearson Education, 2009.

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