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    Using Pert For Schedule Estimation: Janet K. Ply, PHD President, Pendére Inc

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    A powerful technique for estimating tasks where there may not be sufficient information is the Program Evaluation Review Technique (PERT) PERT allows the estimator to include three estimates: optimistic, pessimistic, and Most Likely. Using the PERT approach for determining the project schedule enables the project manager to provide much more information.

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    Using Pert For Schedule Estimation: Janet K. Ply, PHD President, Pendére Inc

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    A powerful technique for estimating tasks where there may not be sufficient information is the Program Evaluation Review Technique (PERT) PERT allows the estimator to include three estimates: optimistic, pessimistic, and Most Likely. Using the PERT approach for determining the project schedule enables the project manager to provide much more information.

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    A powerful technique for estimating tasks where there may not be sufficient information is the Program Evaluation Review Technique (PERT) PERT allows the estimator to include three estimates: optimistic, pessimistic, and Most Likely. Using the PERT approach for determining the project schedule enables the project manager to provide much more information.

    Copyright:

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    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    61 views4 pages

    Using Pert For Schedule Estimation: Janet K. Ply, PHD President, Pendére Inc

    Uploaded by

    vladilunaz
    A powerful technique for estimating tasks where there may not be sufficient information is the Program Evaluation Review Technique (PERT) PERT allows the estimator to include three estimates: optimistic, pessimistic, and Most Likely. Using the PERT approach for determining the project schedule enables the project manager to provide much more information.

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    Using PERT for Schedule Estimation

    Janet K. Ply, PhD


    President, Pendére Inc.

    Copyright (c) 2002, Management Concepts, Inc.

    Originally published in
    Successful Project Management, May, 2002.

    All rights reserved.


    Used with permission.
    Using PERT for Schedule Estimation

    Estimation is not an easy task, especially for complex enterprise software solutions. We
    seldom have sufficient information to understand completely the scope of the project, the
    interfaces (oh, you expected these to be documented?), volumes of data (you expected the
    data to be complete and accurate?), the amount of business process reengineering (yes,
    we think there may be a few processes to change, but nothing major), and on and on. Yet,
    the delivery team is expected to be able to take these types of ambiguous descriptions of
    requirements and miraculously come up with an estimate within 0.5 percent accuracy.
    Usually the budget gets based on some initial SWAG and then everyone expresses
    disbelief that the project manager predicts cost and schedule overruns as more
    information becomes available.

    A powerful technique for estimating tasks where there may not be sufficient information
    is the Program Evaluation Review Technique (PERT).Using the PERT approach for
    determining the project schedule enables the project manager to provide much more
    information by taking into account poorly defined areas, probabilities, and ranges for the
    schedule (versus single point estimates).

    PERT Estimation
    PERT allows the estimator to include three estimates: optimistic, pessimistic, and most
    likely, given by the equation:

    Expected Duration = P + 4(ML) + O


    6

    where P is the pessimistic estimate that is predicted to be achievable a high percentage of


    the time, ML is the most likely estimate, and O is the optimistic estimate that happens a
    low percentage of the time. (Different sources use different percentages, ranging from 90
    to 99 percent for pessimistic and 1 to 10 percent for optimistic.) This simple technique,
    which is easily supported by project management tools or a spreadsheet, enables the
    project team to provide ranges for the schedule estimates, probabilities, and confidence
    levels.

    For example, take a network with the following dependent tasks, with each successor task
    having a finish-to-start relationship with the predecessor task:

    Task A Task B Task C Task D

    Task Name Optimistic Most Likely Pessimistic Expected


    Duration
    Task A 4 days 5 days 7 days 5.17 days
    Task B 3 days 4 days 5 days 4.00 days
    Task C 2 days 4 days 8 days 4.33 days
    Task D 5 days 8 days 12 days 8.17 days
    Total Expected 21.67 days
    Duration
    Using PERT, the expected duration of this path through the network is 21.67 days.

    Estimation Confidence
    Another advantage of using PERT is that you are able to provide a level of confidence for
    the duration that was developed. The probability of completing the project within the
    expected duration can be calculated by the standard deviations of each task, given by the
    equation1:

    σ = pessimistic – optimistic
    6
    The standard deviation of the total path is given by taking the square root of the sum of
    the squares of each task standard deviation. Using the earlier example, the standard
    deviation for each task, as well as the overall network path standard deviation, is
    calculated. The overall standard deviation is calculated as the square root of the sum of
    the squares of each task’s standard deviation, as follows:

    Task Name Expected Standard


    Duration Deviation
    Task A 5.17 days 0.5
    Task B 4.00 days 0.33
    Task C 4.33 days 1
    Task D 8.17 days 1.17
    Total 21.67 days 1.65

    From statistics, one standard deviation (one sigma) represents a 68 percent chance of
    completion, two standard deviations (two sigma) yield a 95 percent chance, and three
    standard deviations (3 sigma) raise the chance to 99 percent. From our example, we can
    determine ranges for completion using different standard deviations, as shown below:

    Sigma Probability Standard Lower Limit Upper Limit


    Deviations
    1 68% 1.65 20.02 days 23.32 days
    2 95% 3.30 18.37 days 24.97 days
    3 99% 4.95 16.72 days 26.62 days

    Using this approach enables the project manager to take into consideration many of the
    unknowns by stating project ranges with varying levels of confidence instead of the
    single point estimate. The customer is given more information for decision-making and is
    made aware of the levels of uncertainty and the impact they may have on the overall
    schedule.

    Now, when asked for a schedule estimate, the project manager can report something like,
    “By using PERT, an approach based on probability and statistics, there is a 95 percent
    confidence level that the project can be completed within 12 to 16 months. There is a
    significant variance based on numerous areas of uncertainty, which is reflected in this

    1
    Harold Kerzner, Project Management, A Systems Approach for Planning, Scheduling, and Controlling, 6th
    edition (New York: Van Nostrand Reinhold, 1998), pp.661-662.
    range. A 99 percent confidence level will increase the range from 10 to 18 months. As
    additional information becomes available, the variance should decrease and a smaller
    range can be calculated.”

    This is a much more powerful statement than “I think we can complete the project within
    12 months but we can’t say for sure until we have more information.” See the difference?

    For a copy of a PERT worksheet in Excel, please contact the author.

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