The key to success of most organisations is to clearly examine the projects or activities for the achievement of an objective within stipulated time and cost. Management is then required to determine detailed activities and their interrelationships, to estimate resources required and the time needed to complete these activities as per schedule, and to monitor and control the time and cost of the project.
Network analysis is a technique which is concerned with minimising the total completion time of the project, as well as minimising the over-all project costs. The network analysis is eminently suitable to projects which are not routine or repetitive and which may be conducted only once or a few times, such as construction of buildings, dams, research and development, marketing of new products, building a ship, construction of factories, missile production, etc. PERT and CPM are the two very popular types of network analysis used in modem management.
PERT is basically a technique of project which is useful in the following managerial functions related to planning, scheduling, controlling, etc.
The first and most important condition for using PERT is the breaking up of the project into jobs or activities and determining the order of precedence for these jobs, that is, deciding which jobs are to be completed before another can be started.