1. Prepared by: Michael Palazzo
PERT Charts
Prepared by: Michael Palazzo

2. What are PERT Charts?
PERT stands for Program Evaluation and Review Technique
To understand what a PERT chart is, we must first learn the Critical Path Method (CPM)

3. CPM Developed as a network model for project management
Uses a fixed time estimate for each activity
Easy to understand but does not account for time variations of activities
-CPM was developed in 1957
-The time variations of different activities in a project can have a huge impact on the completion time of a complex project.

4. What is PERT? Developed in late 1950’s
A network model that allows for randomness in activity completion times
Has potential to reduce time and cost to complete a project
-PERT was developed to help manage the U.S. Navy’s Polaris project which had thousands of contractors

5. Network Diagrams PERT Charts use network diagrams
Activities and milestones of a project are represented by arcs and nodes on a model
PERT was originally Activity-on-Arc diagram
Some now use Activity-on-Node

6. Activity-on-arc network: Activity-on-node network:
Arc vs. Node
Activity-on-arc network:
Activity-on-arc: Activities placed on arrows while milestones are placed in nodes of the diagram (or circles)
Activity-on-node: Activities placed in nodes of the diagram
Activity-on-node network:

7. Example of a PERT Chart
This is an example of a traditional PERT chart modelled using an activity on arc diagram. The activities are represented by the letters A through F. Milestones are placed in the notes. Notice how some milestones can be achieved with the completion of only a few activities; while others, like milestone 50, require all the activities to be completed. (The time is listed in months on this model)

8. 6 Steps Identify Determine Critical Path Determine Activity Sequence
Update
Construct
Estimate

9. Identify/Determine Activity Sequence
Identify Activities and Milestones:
Activities are tasks
Milestones mark beginning and end of activities
Determine Activity Sequence:
Sequence is evident for some
Others require more analysis

10. Construct Construct the Network Diagram:
Create diagram with activity sequence info
For activity-on-arc model, activities are arrowed lines and milestones are circles
Software exists to simplify this step

11. Estimate Estimate Activity Times:
Weeks are commonly used as unit of time
PERT is able to deal with uncertainty in activity completion times
Each activity in model includes three time estimates
Any consistent time unit can be used.

12. Estimate Continued… Optimistic Time: Most Likely Time:
Shortest time activity can be completed
Most Likely Time:
Completion time with highest probability
Pessimistic Time:
Longest time the activity might require
There is a 1% change of the activity finishing in the optimistic time. These time are calculated using statistics and standard deviations (see references for more details about the math involved).

13. Determine Critical Path
Critical path is longest path in project
Determined by adding the times for activities in each sequence
By accelerating activities on critical path you decrease total project time
If the activities outside the critical path speed up or slow down (within limits), the total project time does not change.

14. Update Update as Project Progresses:
Make adjustments to PERT chart as project continues
Resources may need to be added to stay on schedule if there are delays
Estimated times can be replaced with actual times as you move through the project to make PERT chart more accurate/more accurately reflect completion time.

15. Benefits of PERT Gives expected project completion time
Provides probability of completion before a date
Shows critical path activities

16. Benefits Continued… Provides activity start and end dates
Shows activities that have slack time
Activities that do not fall in the critical path can sometimes be delayed without impacting the total completion time of the project. The amount they can be delayed is called slack time. Activities that have slack time can lend resources to critical path activities to help speed them up.

17. Limitations of PERT The activity time estimates are subjective
PERT assumes a beta distribution for its time estimates; actual distribution may be different
If you have limited experience in performing an activity required for the project, the estimated time may be a poor guess.

18. Limitations Continued…
Consistently underestimates the expected project completion time
PERT assumes probability distribution of project completion time is same as critical path
If delayed, other paths can become critical path
If other paths are delayed, they can become the critical path which would lengthen the projection completion time. PERT charts do not account for this.

19. References Pert Charts: http://www.netmba.com/operations/project/pert/
More Information on CPM/CPA:
PERT Chart Images:

20. Thank you for your attention!