Whilst schedule risk analysis is an essential and highly valuable exercise for many projects, it can also be an involved and time consuming process. It can take organizations weeks and often months of interviewing and workshops to reach the stage where they have gathered enough pertinent information on both the schedule and inherent risks to that schedule, to build a truly representative risk model.
With an investment of this magnitude in creating the initial risk model it’s important to leverage this as much as possible when it comes to examining and interpreting the results of the analysis.
There are two distinct approaches used to create risk models but, whether you’re a fan of the ‘build it from a detailed schedule’ approach, or the ‘build it from a rolled up schedule’ approach, there is still the potential for a glut of information to trawl through to find what you’re really interested in.
To alleviate this, identify the key milestones as an integral part of the information gathering stage and then, when it comes to interpreting the results, focus in on those activities and any risks that may be driving them beyond their target completion date / cost.
Having discovered which risks may be responsible for any overruns ensure that this information is available to Stakeholders and other interested parties in a clear and unambiguous manner.
Traditional tornado charts, for example, often simply show a proportional representation of how large one risk is to the project compared with another by means of a correlation coefficient. Whilst this does offer a useful point of comparison it’s not a very intuitive measurement.
Decision makers will be far more interested in knowing the potential impact of a risk in terms of days and dollars. Cutting out some of the noise and reporting on these simple and easy to understand metrics becomes even more important when you consider the iterative nature and number of stage-gates the majority of these projects will go through before completion and will go a long way in improving overall project confidence.