Innovative Strategies in Risk Management
by David Hulett

Qualitative risk analysis is a way to rank project risks in low, moderate and high “bins” based on their probability of occurring and their impact on project objectives if they do occur. The main question is how to determine probability and impact scores of very low, low, moderate, high, or very high. Many risk analyses fail to define what these scores mean or fail to be consistent across project objectives. Controversy also exists concerning whether we can use cardinal (numerical) or ordinal (relative) scores, or both.

Quantitative schedule risk analysis involves quantifying possible values for activity durations, constructing continuous probability distributions, and simulating the schedule. Topics covered include: the quality of the schedule’s construction, the use of constraints and resources, parallel paths and the “merge bias,” the three promises of schedule risk analysis, and probabilistic and conditional branching.