Considerations on Project Quantitative Risk Analysis

Abstract

The continuous growth of the challenges and the complexity of projects, lead to the development of new approaches to model and support uncertainties and risks. The experience gained in project planning shows that the probability of successful implementation of deterministic project schedules and budgets is very low. Therefore project planning technology should always include risk simulation to produce reliable results. The paper presents an analysis of the main risk management standards and guidelines, together with the main project risk quantitative analysis methods. A comparative analysis of the effectiveness of two quantitative risk analysis methods, Monte Carlo simulation and the Three Scenario Approach was made. Two experiments were designed in order to compare the effectiveness of both methods, basing on real projects implemented by the first author of the article. The experiments were performed using specific tools and techniques including the success probability trend as the best indicator of current project status during execution. The main conclusions of the effectiveness analysis are that though the Three Scenario Approach is a semi-probabilistic method and it is not as accurate as Monte Carlo, it is easy to be applied in practice and requires a very short time for computation.