Perform Quantitative Risk Analysis models the aggregate effect of risks on cost and schedule using techniques like Monte Carlo simulation, sensitivity analysis, and decision trees. It answers questions qualitative analysis can’t: how likely are we to hit the date or budget, and how much contingency do we really need?
It is not always performed — it suits larger, complex, or high-stakes projects where the modeling effort is justified. The output updates the risk report with quantified exposure and confidence levels that inform reserves and decisions.
Common pitfalls. Running models on poor inputs and trusting the output; doing it on small projects where it isn’t warranted; presenting single-point results from a probabilistic model; and ignoring correlations between risks.
Inputs, Tools & Techniques, and Outputs
Inputs
- Project management plan
- Project documents
- Enterprise environmental factors
- Organizational process assets
Tools & Techniques
- Expert judgment
- Data gathering
- Interpersonal and team skills
- Representations of uncertainty
- Data analysis
Outputs
- Project documents updates