831-428-2283 | ralph@santaritarisksolutions.com

831-428-2283 | ralph@santaritarisksolutions.com

Risk Analysis

What is Integrated Cost and Schedule Risk Analysis?

Project Managers, Owners and the entire stakeholder team expect to be told how much a project will cost and when it will be completed. Integrated cost and schedule risk analysis examines the risks to the project and specifies how they may affect the project schedule and costs.

From project start, multiple dynamics exist that affect the project finish date and budgeted total cost. In an environment where risk and uncertainty are the expectation the link between time, cost and risk is all too clear.

For example, circumstances impacting various stages of design finalization including regulatory approvals may impact the planned start of work. These events may also impact procurement with later than planned fabrication and material delivery delaying project completion even further.

A realistic approach to understanding the inter-relationships between time, cost, risk, and uncertainty is to integrate these aspects into a single risk model that is representative of the real-world situation.

How do we conduct Integrated Cost and Schedule Risk Analysis?

My work helps clients to understand risk and uncertainty by showing the risk drivers that affect the duration of activities that are included in the schedule.

Using the Risk Driver Method

The use of risk as drivers assigned to activities and resources is referred to as the Risk Driver Method. This method focuses on the risks themselves resulting in the capability for stakeholders to:

  • Show and calibrate the impact of risks that affect the duration of activities in the current plan. These risk drivers result from the risk events that may make the current plan activities take longer.
  • Achieve improved accuracy of the estimate impact basis of cost risks and an understanding about which risks are important.
  • Utilize the project’s resource-loaded schedule to gain more confidence in their cost risk analysis. The best approach to cost risk uses the project schedule as the platform.

Is my Quantitative Risk Analysis Approach Obsolete??? Not at all…

The Risk Driver Method delivers improvements from a fundamental analysis perspective. Rather than the more traditional 3-point estimate placed directly on activity durations or costs, the Risk Driver Method focuses on the risks driving impacts to the cost and schedule of a project.

This is not to say that 3-point estimates or a Risk Register cannot be used in addition to the Risk Driver Approach.

Prioritizing risks is made possible with the Risk Driver approach while gaining the insight of distinguishing the entire effect of the risks on all activities that the risk affects.

Get Started Today

Contact Santa Rita Risk Solutions now to embark on a journey towards enhanced cost and schedule certainty. Your project's success begins here.

Unlock the path to confident project management.