Risk simulation is becoming popular but most risk simulation tools and the ways how they are used miss some important functionalities that make the results of this simulation unreliable.I am continuing my posts about 'Monte Carlo Simulation Challenges':
N1: Monte Carlo Simulation Challenges - Salute Enterprises
N2: Monte Carlo Simulation Challenges. Simplicity Challenge. - Salute Enterprises
N3: Implementation of the Critical Path Methods in Different Scheduling Tools - Salute Enterprises
N4: Monte Carlo Simulation Challenges. Distribution Shapes Challenge. - Salute Enterprises
N5: Monte Carlo Simulation Challenges. Critical Path Volatility Challenge. - Salute Enterprises
N6: Monte Carlo Simulation challenges. Level of details challenge. - Salute Enterprises
What other MCS challenges that need to be discussed?
Regards,
Alex Lyaschenko
Hi Peter,
Sorry for delay with th response.
>1 quality of data assumptions - are we all biased in some way?
Yes, and there are methods to deal with it.
>2 how to get a collective team risk effort rather than risk manager / software
The schedule development process need to be changed. Initial data has to be collected as a range with primary uncertainties from SMEs. Risk managers have to support that and use collected data for analysis.
> 3 "selling" results to senior management in a meaningful way - is it just contingency drawdown?
It is a risk transfer. Senior management can decide to start the project even if it is only, let say 10% to meet dates and cost commitments. The PMs can do their best, but there is a 90% chance that they ask extra time, money or both.
> 4 how do we deal with external project events not explicitily covered in the contract (which seem to becoming more common)
All external dependencies is a specific type of risks and must be managed via risk processes.
Technically, in a risk simulation tool, create an external task, not a milestone (as it has no duration). Simulate the duration uncertainty of this task. I will cover it the future posts.
>5 next simple steps beyond MCS for more real world scenario
Learn MCS “side effects” and alternative approaches, like “3 scenarios” method.
Alex,
1 quality of data assumptions - are we all biased in some way?
2 how to get a collective team risk effort rather than risk manager / software
3 "selling" results to senior management in a meaningful way - is it just contingency drawdown?
4 how do we deal with external project events not explicitily covered in the contract (which seem to becoming more common)
5 next simple steps beyond MCS for more real world scenario
Peter