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PERT

An acronym for program evaluation and review technique; a planning, scheduling, and control procedure based upon the use of time-oriented networks which reflect the interrelationships and dependencies among the project tasks (activities). The major objectives of PERT are to give management improved ability to develop a project plan and to properly allocate resources within overall program time and cost limitations, to control the time and cost performance of the project, and to replan when significant departures from budget occur.

The basic requirements of PERT, in its time or schedule form of application, are:

1. All individual tasks required to complete a given program must be visualized in a clear enough manner to be put down in a network composed of events and activities. An event denotes a specified program accomplishment at a particular instant in time. An activity represents the time and resources that are necessary to progress from one event to the next.

2. Events and activities must be sequenced on the network under a logical set of ground rules.

3. Time estimates can be made for each activity of the network on a three-way basis. Optimistic (minimum), most likely (modal), and pessimistic (maximum) performance time figures are estimated by the person or persons most familiar with the activity involved. The three-time estimates are used as a measure of uncertainty of the eventual activity duration.

4. Finally, critical path and slack times are computed. The critical path is that sequence of activities and events on the network that will require the greatest expected time to accomplish. Slack time is the difference between the earliest time that an activity may start (or finish) and its latest allowable start (or finish) time, as required to complete the project on schedule.

5. The difference between the pessimistic (b) and optimistic (a) activity performance times is used to compute the standard deviation () of the hypothetical distribution of activity performance times [= (b - a)/6]. The PERT procedure employs these expected times and standard deviations (σ² is called variance) to compute the probability that an event will be on schedule, that is, will occur on or before its scheduled occurrence time.

In the actual utilization of PERT, review and action by responsible managers is required, generally on a biweekly basis, concentrating on important critical path activities. A major advantage of PERT is the kind of planning required to create an initial network. Network development and critical path analysis reveal interdependencies and problem areas before the program begins that are often not obvious or well defined by conventional planning methods.

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PERT - Program Evaluation and Review Technique