Influence of Risks on Project Planning Decision

Abstract

In this research, a "Project planning / Risk analysis" model that consists of four modules has been developed to aid the decision-maker in planning different types of projects and analyze the risks. These modules are: Planning, Decision-Making Process 1, Risk Analysis, and Decision-Making Process 2.The model can be used to generate different scenarios of project plan according to the decision-maker's opinion in choosing the type of probability distribution, changing the probability/impact of the risk occurrences and/or changing the input values (time/cost) into the probability distribution. These scenarios will be resulted by Monte Carlo simulation as well as the application of qualitative techniques to assess risks and combining their probability of occurrence and impact, and quantitative techniques to numerically analyze the effect of identified risks. Moreover, it gives the decision-maker the ability of avoiding unexpected events through providing a futuristic look of the most project risky activities by implementing risk ranking matrix using heat map. The developed model will go through interrelating three software; Microsoft Project, Microsoft Excel and @Risk from Palisade.

Keywords

• project planning
• risk analysis
• simulation
• heat map
• decision making
• probability distribution