Pert and its applications

Program (Project) Evaluation and Review Technique (PERT): is a project management tool used to schedule, organize, and coordinate tasks within a project.

1. P rogram E valuation R eview T echnique ( PERT ) and its applications in Project Management OPERATION RESEARCH ASSIGNMENT ON Submitted By- Clayburn Calvert(26) Shruti Mishra (27) Amrit Mohanty (28) Amit Raj(29) Ravi Sunkara (30) Submitted to: Dr. Subhajit Bhattacharya

2. Objective of the presentation To understand the formula, the application and the benefits of Program, Evaluation, and Review Technique (PERT) analysis in Project Management. 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. What is PERT ?

3. 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.

4. 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

5. Determine the duration of the project OPTIMISTIC TIME : B est time if everything goes perfectly REALISTIC TIME: M ost likely time P ESSIMISTIC TIME: A worst-case situation B + 4 M + P Expected Time = ------------------- 6 Three time estimates are required to compute the parameters of an activity’s duration distribution: Example : Expected time for Excavation activity if B=12, M=18, P=60, 12 + 4 (18) + 60 Expected Time = ------------------------- 6 = 24 days

6. 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.

7. 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.

8. Activity cost Activity time Crashing activity Crash time Crash cost Normal Activity Normal time Normal cost Slope = crash cost per unit time Activity Crashing and Time-Cost Relationship

9. 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 cost time Direct cost Indirect cost Total project cost Min total cost = optimal project time Activity Crashing and Time-Cost Relationship

10. CASE STUDY Analysis and Implementation of PERT in the Building of an Aircraft

11. CASE STUDY

12. 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. P rofessionals 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.

13. Thank You