Using a Project Simulation

Project simulations allow a project manager to examine the feasibility of the project schedule under different conditions, variables, and events. For example, the project manager can see what would happen to a project if activities were delayed, vendors missed shipment dates, or external events affected the project.

Simulations are often completed with the Monte Carlo analysis. The Monte Carlo analysis, named after the world-famous gambling city, predicts how scenarios may work out, given any number of variables. The process doesn't actually churn out a specific answer, but a range of possible answers. When Monte Carlo is applied to a schedule, it can examine, for example, the optimistic completion date, the pessimistic completion date, and the most likely completion date for each activity in the project.

As you can imagine in a typical network diagram, there are likely thousands, if not millions, of combinations of tasks that complete early, late, or as expected. Monte Carlo analysis shuffles these combinations, usually through computer software, and offers a range of possible end dates coupled with an expected probability for achieving each end date.

In other words, Monte Carlo analysis is an odds-maker. The project manager chooses, or is at least influenced by, the end date with the highest odds of completion in ratio to the demands for completion by an expected time. The project manager can then predict with some certainty that the project has an 85 percent chance of completion by a specific date.

EXAM TIP Monte Carlo analysis can be applied to more than just scheduling. It can also be applied to cost, project variables, and, most often, risk analysis.

Simulations also provide time to factor in "what-if" questions, worst-case scenarios, and potential disasters. The end result of simulations is to create responses to the feasible situations. Then, should the situations come into play, the project team is ready with a planned response.

Project Management Made Easy

Project Management Made Easy

What you need to know about… Project Management Made Easy! Project management consists of more than just a large building project and can encompass small projects as well. No matter what the size of your project, you need to have some sort of project management. How you manage your project has everything to do with its outcome.

Get My Free Ebook


Post a comment