This blog will provide information and download information about a new edition of Statistical PERT using the beta probability distribution!
I built the original Statistical PERT version in 2014 to easily leverage the built-in statistical functions in Microsoft Excel. Among those statistical functions, the functions for the normal probability distribution (the so-called “bell-shaped curve”) — which are NORM.DIST and NORM.INV — are very easy to use, provided you know the standard deviation for a bell-shaped uncertainty. Statistical PERT provides a rationale way for obtaining a standard deviation that corresponds to the bell-shaped uncertainty and the estimator’s subjective opinion about how likely the most likely outcome really is.
Using the normal distribution with Statistical PERT is very easy to do. But the normal distribution isn’t appropriate for uncertainties which are more than just mildly skewed.
The beta distribution is the actual distribution upon which the original PERT was based. And Microsoft Excel has built-in functions for the beta distribution, just like it has for the normal distribution (BETA.DIST and BETA.INV). However, the beta distribution functions require several arguments, but the most difficult two arguments are two shape parameters, alpha and beta, that dictate the probabilistic shape of the resulting beta distribution. Using these shape parameters, one can create a beta distribution that looks identical to a normal, bell-shaped distribution, or you can create right triangles, or shapes that show very strong skewing either to the left or to the right. In short, the beta distribution is very flexible, but it’s harder to use.
My goal is to expand Statistical PERT to offer both an edition that’s easy to use, understand, and manipulate using the normal distribution, and another edition which is still just as easy to use and understand, but is more accurate and flexible than the version using the normal probability. To do that, though, it will not be as easy to calibrate the SPERT templates which use the beta distribution. It can still be calibrated and customized, but just not as easily.
Very soon, I’ll begin making downloads available on the new edition of Statistical PERT which uses the beta distribution. These downloads won’t even be “beta” software, rather, they’ll be work-in-progress, “alpha” software which haven’t been tested rigorously and which will change and evolve a lot before I make them available for downloading on the Statistical PERT regular download page.
I’m really excited about expanding Statistical PERT in 2016 to a wide variety of project managers and anyone else who needs to easily make probabilistic estimates. And I’m really excited about offering an edition of Statistical PERT which leverages the beta distribution inside Microsoft Excel!