The following example provides an illustration of how to include identified risks in a project schedule model:
A project consists of several activities as shown on the diagram below:
The duration of each activity is defined as a triangular distribution with the minimum, most likely and maximum values.
Stages B, C and D can only start after activity A is finished. Stages E, H and K can only start when all of B, C and D activities are finished. Stages N and O can only start when all of G, J and M activities are finished. Stage P can only start when both N and O activities are finished.
There are three risks that can influence the duration of certain stages as summarized below:
Each of these three risks influences just one stage (activity), however, this model can be extended so that one risk could affect the duration of any number of activities. The minimum, most likely and maximum values in the table above define the percentage of increase in duration of the affecting activity (for risk 1) and the additional number of weeks that the affecting activities will take if the risk occurs (for risks 2 and 3). The last column of the table above shows the probability of occurrence of each risk.
The task is to calculate the distribution for the total duration of the project.
The solution to this example is provided in the model: Schedule Model with Risks
The links to the Schedule Model with Risks software specific models are provided here: