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Anugraha Vasan 1812560, 5bcomp A

The document discusses several statistical tools used for project management including the critical path method (CPM), program evaluation and review technique (PERT), earned value management (EVM), drag cost, and Gantt charts. CPM determines the longest path of dependent activities to identify the shortest time to finish a project. PERT was developed for large, complex projects and incorporates uncertainty. EVM measures project performance by combining scope, time, and cost measurements. Drag cost quantifies the reduction in return on investment due to critical path delays. Gantt charts illustrate project schedules and dependencies using a bar chart format.

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69 views2 pages

Anugraha Vasan 1812560, 5bcomp A

The document discusses several statistical tools used for project management including the critical path method (CPM), program evaluation and review technique (PERT), earned value management (EVM), drag cost, and Gantt charts. CPM determines the longest path of dependent activities to identify the shortest time to finish a project. PERT was developed for large, complex projects and incorporates uncertainty. EVM measures project performance by combining scope, time, and cost measurements. Drag cost quantifies the reduction in return on investment due to critical path delays. Gantt charts illustrate project schedules and dependencies using a bar chart format.

Uploaded by

anugraha vasan
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Anugraha Vasan 1812560 , 5Bcomp A

A9- STATISTICAL TOOLS


Statistical tools include mathematical tools which are important for project management as they
efficiently provide analysis to process raw data . Different statistical tools are as follows :

1. CRITICAL PATH METHOD (CPM): The critical path method  is an algorithm for scheduling a


set of project activities. It is commonly used in conjunction with the program evaluation and
review technique (PERT). A critical path is determined by identifying the longest stretch of
dependent activities and measuring the time required to complete them from start to finish.
This model starts with the list of activities essential for the activity, then the next step is to
find duration of completion of that activity after this is done see if there’s dependencies
between the activity and lastly logical end points are taken . critical path calculates the
longest path by taking the logical end points . One can analyse the critical activities and the
total float using this method . In project management specifically we can find the shortest
time required to finish the project .

2. PROGRAM EVALUTATION AND REVIEW TECHNIQUE (PERT): PERT was developed in 1957 by
the US Navy Special Projects Office . It is a method of analyzing the tasks involved in
completing a given project, especially the time needed to complete each task, and to
identify the minimum time needed to complete the total project. It incorporates uncertainty
by making it possible to schedule a project while not knowing precisely the details
and durations of all the activities. It is more of an event-oriented technique rather than
start- and completion-oriented, and is used more in those projects where time is the major
factor rather than cost. It is applied on very large-scale, one-time, complex, non-routine
infrastructure and on Research and Development projects.

PERT has four types of time which include

 Optimistic time :min possible time required to complete an activity


 Pessimistic time : max possible time required to complete an activity
 Most likely time : the best estimated time required to complete an activity
 Expected time : average time required of the activity is repeated on a number of situations .
3. Earned value management: Earned value management is a project management technique
for measuring project performance and progress. It has the ability to combine
measurements of the project management triangle: scope, time, and costs. Essential
features of any EVM implementation include:

 A project plan that identifies work to be accomplished

 A valuation of planned work, called planned value (PV) or budgeted cost of work
scheduled (BCWS)

 Pre-defined "earning rules" (also called metrics) to quantify the accomplishment of work,
called earned value (EV) or budgeted cost of work performed (BCWP)
EVM implementations for large or complex projects include many more features, such as
indicators and forecasts of cost performance (over budget or under budget) and schedule
performance (behind schedule or ahead of schedule). However, the most basic requirement of
an EVM system is that it quantifies progress using PV and EV.

4. DRAG COST : This cost is amount by which the ROI of the cost is reduced due to the critical
cost drag. . This cost is most commonly used for justifying the project resources .Drag cost is
used on an activity where the impact of that is caused by the project level which is either by
 Reduction of projects expected value by late completion
 Increase in cost by increase in indirect cost because of longer cost duration .

5. Gantt chart: It is a type of bar chart that illustrates a project schedule, named after its
inventor, Henry Gantt  who designed such a chart around the years 1910–1915.
Gantt charts illustrate the start and finish dates of the terminal elements and summary
elements of a project. Terminal elements and summary elements constitute the work
breakdown structure of the project. Modern Gantt charts also show the dependency (i.e.,
precedence network) relationships between activities. Gantt charts can be used to show
current schedule status using percent-complete shadings and a vertical "TODAY" line as
shown here. Gantt charts are sometimes equated with bar charts.

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