Development of quantitative cost and schedule risk analysis process

This paper describes a quantitative probabilistic risk analysis process able to reveal how one or more cost and/or schedule risks, mapped to any or all linked tasks of a complex integrated master project schedule network, impact a project or program described by the schedule. Technical and programmatic risks are formulated in terms of the salient features that can possibly go wrong and expressed as probabilistic distributions representing the likelihood of occurrence and impact (cost and/or time). The authors have employed a software product called "GoldPan" to accomplish this. They have successfully used it for NASA projects, as well as the U.S. Navy and the National Reconnaissance Office. It is currently being prepared for another NASA project. The paper presents each step of the process from collaborating with the customer/decision maker, mapping risks to tasks, running the simulation, to presenting results to decision makers. From it earliest application to now, this risk analysis process is constantly being refined and improved in parallel with continuing refinement and improvement of GoldPan made by its developer, Decision Mining. This paper also discusses approaches being considered to provide automated ways to integrate technical risk parameters, which furthers the utility of this process and tool.