A Guide to Project Management

Process are evaluated along with their potential

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Unformatted text preview: 11.4 QUANTITATIVE RISK ANALYSIS The quantitative risk analysis process aims to analyze numerically the probability of each risk and its consequence on project objectives, as well as the extent of overall project risk. This process uses techniques such as Monte Carlo simulation and decision analysis to: Determine the probability of achieving a specific project objective. Quantify the risk exposure for the project, and determine the size of cost and schedule contingency reserves that may be needed. Identify risks requiring the most attention by quantifying their relative contribution to project risk. Identify realistic and achievable cost, schedule, or scope targets. Quantitative risk analysis generally follows qualitative risk analysis. It requires risk identification. The qualitative and quantitative risk analysis processes can be used separately or together. Considerations of time and budget availability and the need for qualitative or quantitative statements about risk and impacts will determine which method(s) to use. Trends in the results when quantitative analysis is repeated can indicate the need for more or less risk management action. Project Project Management Management Body of Body of KnowledgeE L KnowledgeE PL MP AM SA S A Guide to the Project Management Body of Knowledge (PMBOK Guide) 2000 Edition 2000 Project Management Institute, Four Campus Boulevard, Newtown Square, PA 19073-3299 USA NAVIGATION LINKS ACROYMNS LIST ACRONYMS LIST 137 ACROYMNS LIST Chapter 11--Project Risk Management 11.4.1 | 11.4.3.4 Inputs Risk management plan Identified risks List of prioritized risks List of risks for additional analysis and management .5 Historical information .6 Expert judgment .7 Other planning outputs .1 .2 .3 .4 Tools & Techniques .1 .2 .3 .4 Interviewing Sensitivity analysis Decision tree analysis Simulation Outputs .1 Prioritized list of quantified risks .2 Probabilistic analysis of the project .3 Probability of achieving the cost and time objectives .4 Trends in quantitative risk analysis results ment ment 11.4.1 .1 .2 .3 .4 geE L geE PL P Inputs to Quantitative Risk Analysis Risk management plan. This plan is described in Section 11.1.3. Identified risks. These are described in Section 11.2.3.1. List of prioritized risks. This is described in Section 11.3.3.2. List of risks for additional analysis and management. This is described in Section 11.3.3.3. .5 Historical information. Information on prior, similar completed projects, studies of similar projects by risk spets, and risk databases that may be available from industry or proprietary sources (see Section 11.2.1.4). .6 Expert judgment. Input may come from the project team, other subject matter experts in the organization, and from others outside the organization. Other sources of information include engineering or statistical experts (see Section 5.1.2.2). .7 Other planning outputs. Most helpful planning outputs are the project logic and duration estimates used in determining schedu...
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This document was uploaded on 09/27/2013.

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