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Better Estimation of PERT Activity Time Parameters

Author

Listed:
  • Donald L. Keefer

    (Department of Decision and Information Systems, College of Business, Arizona State University, Tempe, Arizona 85287-4206)

  • William A. Verdini

    (Department of Decision and Information Systems, College of Business, Arizona State University, Tempe, Arizona 85287-4206)

Abstract

This paper builds upon earlier work from the decision/risk analysis area in presenting simple, easy-to-use approximations for the mean and variance of PERT activity times. These approximations offer significant advantages over the PERT formulas currently being taught and used, as well as over recently proposed modifications. For instance, they are several orders of magnitude more accurate than their PERT counterparts in estimating means and variances of beta distributions if the data required for all methods are obtained accurately. Moreover, they utilize probability data that can be assessed more reliably than those required by the PERT formulas, while still requiring just three points from each activity time probability distribution. Using the proposed approximations can significantly improve the accuracy of probability statements about project completion time, and their use complements ongoing efforts to improve PERT analyses of networks involving multiple critical paths.

Suggested Citation

  • Donald L. Keefer & William A. Verdini, 1993. "Better Estimation of PERT Activity Time Parameters," Management Science, INFORMS, vol. 39(9), pages 1086-1091, September.
    • Handle: RePEc:inm:ormnsc:v:39:y:1993:i:9:p:1086-1091
    DOI: 10.1287/mnsc.39.9.1086
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    Citations

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    Cited by:

    1. Jin-Huei Yeh & Jying-Nan Wang & Chung-Ming Kuan, 2014. "A noise-robust estimator of volatility based on interquantile ranges," Review of Quantitative Finance and Accounting, Springer, vol. 43(4), pages 751-779, November.
    2. James W. Taylor, 2005. "Generating Volatility Forecasts from Value at Risk Estimates," Management Science, INFORMS, vol. 51(5), pages 712-725, May.
    3. Moors, J.J.A. & Schuld, M.H. & Mathijssen, A.C.A., 1995. "A new method for assessing judgmental distributions," Research Memorandum FEW 708, Tilburg University, School of Economics and Management.
    4. Kamburowski, J., 1997. "New validations of PERT times," Omega, Elsevier, vol. 25(3), pages 323-328, June.
    5. Jessop, Alan, 2014. "IMP: A decision aid for multiattribute evaluation using imprecise weight estimates," Omega, Elsevier, vol. 49(C), pages 18-29.
    6. Bordley, Robert F. & Keisler, Jeffrey M. & Logan, Tom M., 2019. "Managing projects with uncertain deadlines," European Journal of Operational Research, Elsevier, vol. 274(1), pages 291-302.
    7. Verónica Morales-Sánchez & Antonio Hernández-Mendo & Pedro Sánchez-Algarra & Ángel Blanco-Villaseñor & María-Teresa Anguera-Argilaga, 2009. "Random PERT: application to physical activity/sports programs," Quality & Quantity: International Journal of Methodology, Springer, vol. 43(2), pages 225-236, March.
    8. Moors, J.J.A. & Strijbosch, L.W.G. & van Groenendaal, W.J.H., 2002. "Estimating Mean and Variance Through Quantiles : An Experimental Comparison of Different Methods," Other publications TiSEM 2425a85a-ba86-4f72-837a-0, Tilburg University, School of Economics and Management.
    9. Yang, Hsu-Hao & Chen, Yen-Liang, 2000. "Finding the critical path in an activity network with time-switch constraints," European Journal of Operational Research, Elsevier, vol. 120(3), pages 603-613, February.
    10. A Jessop, 2011. "Using imprecise estimates for weights," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 62(6), pages 1048-1055, June.
    11. Hahn, Eugene David, 2008. "Mixture densities for project management activity times: A robust approach to PERT," European Journal of Operational Research, Elsevier, vol. 188(2), pages 450-459, July.
    12. Robert K. Hammond & J. Eric Bickel, 2013. "Reexamining Discrete Approximations to Continuous Distributions," Decision Analysis, INFORMS, vol. 10(1), pages 6-25, March.
    13. López Martín, M.M. & García García, C.B. & García Pérez, J. & Sánchez Granero, M.A., 2012. "An alternative for robust estimation in Project Management," European Journal of Operational Research, Elsevier, vol. 220(2), pages 443-451.
    14. M Revie & T Bedford & L Walls, 2010. "Evaluation of elicitation methods to quantify Bayes linear models," Journal of Risk and Reliability, , vol. 224(4), pages 322-332, December.
    15. Kotz, Samuel & van Dorp, J. René, 2005. "A link between two-sided power and asymmetric Laplace distributions: with applications to mean and variance approximations," Statistics & Probability Letters, Elsevier, vol. 71(4), pages 383-394, March.
    16. Johan René van Dorp & Salvador Cruz Rambaud & José García Pérez & Rafael Herrerías Pleguezuelo, 2007. "An Elicitation Procedure for the Generalized Trapezoidal Distribution with a Uniform Central Stage," Decision Analysis, INFORMS, vol. 4(3), pages 156-166, September.
    17. Lau, Hon-Shiang & Lau, Amy Hing-Ling & Kottas, John F., 2000. "A comparison of procedures for estimating the parent probability distribution from a given set of fractiles," European Journal of Operational Research, Elsevier, vol. 120(3), pages 657-670, February.
    18. S Mohan & M Gopalakrishnan & H Balasubramanian & A Chandrashekar, 2007. "A lognormal approximation of activity duration in PERT using two time estimates," Journal of the Operational Research Society, Palgrave Macmillan;The OR Society, vol. 58(6), pages 827-831, June.
    19. Saurabh Bansal & Genaro J. Gutierrez, 2020. "Estimating Uncertainties Using Judgmental Forecasts with Expert Heterogeneity," Operations Research, INFORMS, vol. 68(2), pages 363-380, March.
    20. Chen, Yen-Liang & Rinks, Dan & Tang, Kwei, 1997. "Critical path in an activity network with time constraints," European Journal of Operational Research, Elsevier, vol. 100(1), pages 122-133, July.
    21. Susan Cholette & Özgür Özlük & Mahmut Parlar, 2012. "Optimal Keyword Bids in Search-Based Advertising with Stochastic Advertisement Positions," Journal of Optimization Theory and Applications, Springer, vol. 152(1), pages 225-244, January.
    22. Opabola, Eyitayo A. & Galasso, Carmine, 2024. "A probabilistic framework for post-disaster recovery modeling of buildings and electric power networks in developing countries," Reliability Engineering and System Safety, Elsevier, vol. 242(C).
    23. Moors, J.J.A. & Schuld, M.H. & Mathijssen, A.C.A., 1995. "A new method for assessing judgmental distributions," Other publications TiSEM 7ad88666-4ed3-42bf-a563-d, Tilburg University, School of Economics and Management.
    24. Guofeng Ma & Jianyao Jia & Tiancheng Zhu & Shan Jiang, 2019. "A Critical Design Structure Method for Project Schedule Development under Rework Risks," Sustainability, MDPI, vol. 11(24), pages 1-20, December.
    25. Hon-Shiang Lau & Amy Hing-Ling Lau & Chrwan-Jyh Ho, 1998. "Improved Moment-Estimation Formulas Using More Than Three Subjective Fractiles," Management Science, INFORMS, vol. 44(3), pages 346-351, March.

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