Page 171 - DEDU503_EDUCATIONAL_MANAGEMENT_ENGLISH

Unit 13: Concept of PERT and CPM

13.12 Summary Notes

• Program Evaluation and Review Technique (PERT) is a scheduling method originally designed
to plan a manufacturing project by employing a network of interrelated activities, coordinating
optimum cost and time criteria.
• PERT is an integrated project management system. These, systems were designed to manage
the complexities of major manufacturing projects, the extensive data necessary for such industrial
efforts, and the time deadlines created by defense industry projects.
• PERT was first developed in 1958 by the U.S. Navy Special Projects Office on the Polaris
missile system. Existing integrated planning on such a large scale was deemed inadequate, so
the Navy pulled in the Lockheed Aircraft Corporation and the management consulting firm of
Booz, Allen, and Hamilton.
• PERT centers on the concept of time and allows flexible scheduling due to variations in the
amount of time it takes to complete one specific part of the project. A typical PERT network
consists of activities and events. An activity is defined as the time and resources required to
move from one event to another.
• One key element to PERT’s application is that three estimates are required because of the element
of uncertainty and to provide time frames for the PERT network.
• A vital aspect of PERT is the formula used for the calculation of expected project time. The
project reads :
where T = expected completion time,
A = optimistic estimate,
M = most likely estimate,
B = pessimistic estimate.
• Once the expected time is computed, the critical path is established. The PERT network considers
all potential variables, thus quantifying the scheduling and planning of the project. In a
comprehensive view of PERT, it becomes clear that despite the fact that some steps of the
process are independent, the next step will depend on the successful completion of prior steps.
• Another key to PERT is to analyze and revise the data owing to a constant state of flux. Factors
influencing project management take many forms, including personnel, materials, equipment
and facilities, utilities, and environmental conditions.
• PERT has advantages as well as disadvantages, but time has seemingly not diminished its
applicability. Planning a major network reveals potential problem areas and interdependent
events that are not so obvious in conventional project development methods. One advantage is
the three time estimate process, again useful in identifying difficulties as well as more effective
interrelated processes.
• The PERT/cost system was developed to gain tighter control over actual costs of any project.
PERT\cost relates actual costs to project costs. Job cost estimates are established from an activity,
or a group of activities on the basis of a time network.
• Critical path method uses a mathematically-based algorithm in effective project management.
The system helps an individual or organization establish a set of activities and find the best
schedule to finish each task.
• In 1957, DuPont developed a project management method designed to address the challenge of
shutting down chemical plants for maintenance and then restarting the plants once the
maintenance had been completed.

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