Program Evaluation Review Technique method and examples

Program Evaluation Review Technique method and examples

1. Jawaharlal Nehru Architecture and Fine Arts University
School of Planning and Architecture
Department- Urban and Regional Planning
Subject- Project Formulation, Appraisal and Management
Topics- Program Evaluation Review Technique method and
examples
Name- Adithya A
Roll No- 17011BA001

2. PERT 2
Contents
Program Evaluation and Review Technique (PERT) 1............................................................................3
Program Evaluation and Review Technique (PERT) 2............................................................................7
Advantages............................................................................................................................................7
Limitations.............................................................................................................................................7
Network fundamentals:.........................................................................................................................8
Event:................................................................................................................................................8
Activity:..............................................................................................................................................8
Network Rules:......................................................................................................................................8
Network Development..........................................................................................................................9
Standard Deviation..............................................................................................................................10
Activity Table.......................................................................................................................................10
Network...............................................................................................................................................11
Earliest Starting Time(EST)...................................................................................................................11
Latest Starting Time (LST)....................................................................................................................11
Slack Time:...........................................................................................................................................11
Critical Path:........................................................................................................................................12
Calculation of Probability of a Project.................................................................................................12
Step1:..............................................................................................................................................13
Step2:..............................................................................................................................................13
Example...............................................................................................................................................13
References...........................................................................................................................................17

3. PERT 3
Program Evaluation and Review Technique (PERT) 1

4. PERT 4

5. PERT 5

6. PERT 6

7. PERT 7
Program Evaluation and Review Technique (PERT) 2
PERT deals with the problem of uncertainty in the activity time
It helps to coordinate the activities successfully to accomplish the objectives of a project on
time.
It acts as an effective tool for decision making
In pert the activity time usually expressed in calendar weeks.
Advantages
• This technique helps the management to plan the best possible use resources to a given goal
within the time and cost limitations.
• It helps management to handle the uncertainties involved in the program.
• It process for the right action point and at right time in the organization.
• It provides information on existence of slack period between activities and what activities
are crucial in terms of time to complete project.
• It gives a basis of obtaining the necessary facts for decision-making.
• PERT allows a large amount of data to be presented in a well-organized diagram known as
network from which both the executor and customer can make joint decisions.
Limitations
• The basic difficulty comes in the way of time estimate for the completion of activities
because activities are non-repetitive type.
• The technique does not consider resources required at various stages of the project.
• Use of this technique for active control of a project requires frequent updating and revising
the PERT calculations and this proves quite a costly affair.

8. PERT 8
When PERT applied properly it helps to do the following jobs effectively.
• Cut project cost and reduce time.
• Coordinate and expedite planning.
• Eliminate slack (idle) time.
• Cut time required for routine decisions, but allows more time for critical decision-makings.
Network fundamentals:
Networks are composed of events and activities
Event:
An event is defined as the starting or ending point of an activity or a group of activities. It
represents a milestone and does not consume time or resources. Event is described by a circle
(o).
Activity:
Activity is the work required to proceed from one event to another. It consumes therefore
time and resources. It is represented by an arrow (->)
• To draw network diagram an interdependencies between events and activities must be
identified so that master plan can be developed which illustrate the up-to-date picture of
operations during the project.
• Network analysis provides valuable information for planning, integration of plans, time
scheduling, and resource management.
• The primary purpose of network is to eliminate crisis management by providing a pictorial
representation of the total program from which the time estimates such as early starting
time(EST) and late starting time (LST) and their impact can be made.
Network Rules:
• Each activity must have a preceding and a succeeding event

• Each Event should have a distinct (unique) number.
• There should not be loop in the project network as shown below:
1 2

9. PERT 9
• Note More than one activity can have the same preceding and succeeding event
• Any number of activities may merge with an event.
Network Development
1. Enumerate all those activities in the Project which needs close monitoring to complete
them in time.
2. Define each activity as
Preceding activity (the activity which precedes it)
Succeeding activity (the activity which followed)
Concurrent activity (the activity that can be done concurrently)
3. Estimation of time for the completion of each activity.
The estimation of time for the completion of each activity is important in the network
analysis. This can be done using three possible assumptions.
I. Optimistic time (a):
This time assumes that everything will go accordingly to with minimum amount of
difficulties and such situation may occur approximately 1 per cent of time.
II. Most pessimistic time (b):
This time assumes that everything will not go according to plan and that the maximum
potential difficulties will develop and may occur approximately one per cent of time.
III. Most likely or normal time (m):
This is the time that would most often occur should this effort be reported over again
1
2
3
1
2
1

10. PERT 10
The estimated time of the completion of an activity is given by:
te= (a+4m+b)/6
Where
te = estimated time
a = most optimistic time
m = normal time
b = most pessimistic time
Standard Deviation
Standard deviation of the estimated time (te):
sd (te) = (b-a)/6
The time estimates (weeks) for various activities in a dummy project are illustrated below:
Activity Table

11. PERT 11
Network
Earliest Starting Time(EST)
EST is the time at which activity cannot be started earlier than this time that means it is a
waiting time to start next activity.
In the above network, event 4 occurs when activities A (1-2), B (1-3), C (2-4) and D (3-4) are
completed. In other words event 4 occurs when paths (1-2-3-4) and (1-3-4) are completed and
the requirement time for the two paths is 23 and 20 weeks respectively. In the above network
1-3-4 is the path with longest time (23 weeks).Therefore this is the EST for the activity F, it
mean to start activity F one has to expect to wait 23 weeks.
Latest Starting Time (LST)
LST is the time, at which the starting of an activity cannot be delayed beyond this time. In
other words it includes non-waiting time. As further delay beyond this time will adverse
effect the project duration. The LST for an event is obtained by making EST and LST is
equal for the end event and calculated by working backward. The path with shortest time
among the path is considered for LST. In this example the LST of an event 2 is 13 since
among the two paths 2-5 and 2-4-5; the path2-5 is the shortest.
In general the WST of an event is indicated in the left half of the circle and LST is indicated
in the right half of the circle as shown below.
Slack Time:
Slack Time in a network is defined as the difference between Latest Starting Time (LST) and
Earliest Starting Time(EST) of an event.
Slack Time=LST-EST
Slack Time (week) in the above network for the events 2, 3, and 4 are given below:
1
0, 0
2
13, 13
3
15, 18
4
23, 26
5
28, 28
13
A
12
B
C
2
8
D
15
E
2
F

12. PERT 12
The above figure indicated the activity E should be starting immediately after completion of
Event 2. Whereas even if activity D and F are little delay in their start, may not adversely
affect the project duration much. If there is any shortfall or crunch in resources, the priority
should be given to activity A and followed by D and F.
Critical Path:
The critical path is one having longest-time span through the total system of events. For
example in the above network the possible paths and total time of each path are:
Path Total time
1-2-5: 28
1-2-3-4-5: 25
1-3-4-5: 22
The Critical path in the above network composed of events 1-2-5, being longest time-span
among the three paths. The critical path is vital for successful control of the project because it
provides information to the management on two things:
1. Because there is no slack time in any of the events on the path, any delay will cause a
corresponding delay in the end-date of the program, unless the delay can recovered during
any of the downstream events on the critical path.
2. Because of the event on this path are the most critical for the success of the project
management must take a hard look at these events, in order to improve the total program.
Also if we want to reduce the total duration of a project we should be able to reduce the time
taken by activity on the critical path.
Calculation of Probability of a Project
Assuming that the probability distributions of activities on the critical path are independent,
the variance of the critical path duration is obtained by adding variances of activities on the
critical path (C.P.) in the above network. A and E are the activities on the critical path.
The variance of the activities on C.P. = Var (A) + Var (E)
And Sd (CP) = SQRT [(Var (A) +Var (e)]

13. PERT 13
With the information on mean (m) and s.d (s) for critical path duration, which is assumed as
normally distributed, we can compute the probability of completion of a project by a specific
date (d) from the following steps
Step1:
Find Z = (d-m)/sd Where Z is known as standard normal variate with mean and variance
Step2:
Obtain cumulative probability up to z from the table "area under normal curve"
As an illustration consider a dummy network with mean (m) and s.d(s) of a critical path 28
weeks and 3.0 weeks respectively. Then the Probability of completion of a project by certain
specified dates are given by:
It is seen from the above table that the project can be completed within 30 weeks with high
probability (0.73).On the other hand it is impossible to complete it within 20 weeks as
indicated by the probability (0.005).
Example
A farm manager has undertaken a project on to develop a farm in a regional station. The
activities identified in the project, their interrelationships and the time distribution of each
activity is shown in following activity table.

14. PERT 14
For the above project calculate Expected time (te) and s.d (te) and draw the flow chart,
network and find the critical path. Also calculate the expected time, slacks for each event and
the probability of completion of the project for different periods 60, 65, 70,75,80,85 ways.

15. PERT 15
Critical path 0-1-2-3-4-5-9-10
Critical path duration = 73 weeks
Mean duration of C.P: 73 weeks
Sd (c.p) = 3.4 weeks
Now let us find out the probability for the completion of project for specific dates (d)
0
0, 0
1
8, 8
2
15, 15
3
35, 35
4
44, 44
5
50, 50
6
36, 41
7
50, 55
8
50, 55
9
67, 67
10
73, 73
8
A
7
B
20
C
9
D
6
E
21
G
17
F
6
J
13
H
14
I
8
K
6
L

16. PERT 16
From the above table it is seen that the project may be completed within 60 days is highly
impossible. It may be completed within 75 weeks with probability 0.61. The project will
however be completed in 80 weeks with certainty (P=0.98).

17. PERT 17
References
Project Management Tools PERT
https://naarm.org.in/VirtualLearning/vlc/downloads/Project%20Management%20Tools.pdf
Building Construction and Management book