Project Risk Analysis. Neil Dunkerley 17 th May 2012

Transcription

1 Project Risk Analysis Neil Dunkerley 17 th May 2012

2 About EC Harris EC Harris is a leading global Built Asset Consultancy, helping clients make the most from their investment and expenditure in built assets. We work across a wide range of sectors, and our professional skills include disciplines from asset and facilities strategy to management information systems quantity surveying, programme, project, risk and construction management to software development. In 2011 we became part of the ARCADIS Group of companies ARCADIS is an international company providing consultancy, design, engineering and management services in infrastructure, water, environment and buildings. Neil Dunkerley 17 th May

3 Project Risk Analysis Quantitative Risk Analysis (QRA) Why Modelling Outputs Benefits Range Modelling Railway Possessions Wave Analysis Completion Date Range 07/Jan/01 04/Feb/01 04/Mar/01 01/Apr/01 29/Apr/01 27/May/01 0% 4% Nationwide Sorted by 75% completion date Values in 10^ -4 7% 11% 15% 18% 22% 26% 29% 33% 37% 40% 44% 48% 51% 55% 59% 62% 66% 70% 73% 77% 81% 84% 88% 92% 95% 99% Distribution for Risk total / Risk total/ck Mean= Values in Thousands 5% 90% 5% /Jun/01 22/Jul/01 19/Aug/01 Neil Dunkerley 17 th May

4 Project Risk Analysis To enable Clients to gain confidence in estimates and schedules should understand the outputs appropriate analysis should be undertaken Aids decision making Neil Dunkerley 17 th May

5 QRA Why? Overspend & Overrun Cost Deterministic estimation Unforeseen events e.g. risks Scope uncertainty / change Assumptions incorrect Exclusions Schedule Deterministic estimation Unforeseen events e.g. risks Scope uncertainty / change Assumptions incorrect Exclusions Sunny-day forecasting Human factors (sickness, holidays, etc) Key milestone constraints Perceived critical path Neil Dunkerley 17 th May

6 QRA Modelling Cost Review / check estimate Scope Inflation base date Contingency Assumptions / Exclusions Uncertainty in quantities & rates Values in 10^ -4 Distribution for Risk total / Risk total/ck Mean= Values in Thousands 5% 90% 5% Risks e.g. ground conditions, approvals, exchange rates, political, etc Distribution for Risk total / Risk total/ck109 Mean= Values in Thousands 5% 90% 5% Neil Dunkerley 17 th May

7 QRA Modelling Schedule Review / check schedule Scope Contingency / Float Assumptions / Exclusions Logic Constraints, Missing, Leads & Lags, Types Calendars Resources (Levelling, Productivity) Modelling Pertmaster Correct logic errors / remove constraints Uncertainty in task duration (generic, task / group specific) Risks e.g. ground conditions, approvals, weather, political, etc Neil Dunkerley 17 th May

8 QRA Outputs Cost Total Sections / Elements Contingency Target costs Uncertainty / risk sensitivity Schedule Schedule Finish Dates Task Start / Finish Dates Sectional completions Key milestones Float / Contingency Task Criticality Duration / Schedule Sensitivity Uncertainty / risk sensitivity Neil Dunkerley 17 th May

9 QRA Benefits? Independent review of estimate / schedule Scope defined (baseline) Assumptions & Exclusions defined & agreed Unforeseen events (e.g. risks) identified & prioritised for management (i.e. risk register) Contingency estimated & agreed Schedule Model key tasks / stage durations & anticipated finish Critical path review and task criticality Removes double counting of project delay in cost risk register Neil Dunkerley 17 th May

10 Range Modelling

11 Range Modelling Why? Organisations are careful when publishing estimates as failing to reliably predict the outturn cost can result in a loss of reputation Often the world is not that simple, programmes and projects change A more informative method of presenting estimates, is to present an expected outturn and express the range of likely outcomes that the outturn cost is likely to fall within. This has two advantages: Early estimates reflect the range of costs associated with solutions in development Estimates for projects nearing construction should be become more certain Neil Dunkerley 17 th May

12 What EC Harris has delivered The Highways Agency post the Nicholls Review 2006 selected EC Harris to support range estimating given our industry experience and our flexibility to mobilise to meet demanding timescales. Created a Range Modelling Tool that captures estimates based upon a standard WBS; with estimates, risk and uncertainty allowances. Particular innovations of the Range Modelling Tool are: Takes into account different modelling distributions, accuracy of data, and dependencies Automate the process of uploading project estimates from separate excel files. In built checking mechanisms in triplicate, confirms the accuracy of results. Neil Dunkerley 17 th May

13 Range Modelling Neil Dunkerley 17 th May

14 Railway Possessions Overrunning Engineering Works

15 Railway Projects Development / Preparatory Works Engineering Works Possession/s Neil Dunkerley 17 th May

16 Railway Possessions Take Poss. Prep. Works Works Reinstatement. Works Return Poss. Operational Railway Operational Railway Milestone/s Milestone Neil Dunkerley 17 th May

17 Wave Analysis

18 Wave Analysis A Wave model and chart are a form of time risk model that shows the range of completion dates for each of many small projects, usually of a similar nature Nationwide Sorted by 75% completion date 07/Jan/01 0% 4% 7% 11% 15% 18% 22% 26% 29% 33% 37% 40% 44% 48% 51% 55% 59% 62% 66% 70% 73% 77% 81% 84% 88% 92% 95% 99% 04/Feb/01 04/Mar/01 Completion Date Range 01/Apr/01 29/Apr/01 27/May/01 24/Jun/01 22/Jul/01 19/Aug/01 Neil Dunkerley 17 th May

19 Wave Analysis Each project will have a planned completion date The effect of any opportunities or risks to completion is to spread the planned completion date over a range: tim e lin e 5 M a r, p la n n e d 3 1 M a r, c o m p le tio n e a r ly c o m p le tio n la te c o m p le tio n d a te Each date within this range has a probability of occurrence P robab ility 5% probability completion on or before 95% probability completion on or before There is a date in the range at which there is a 75% chance the project will be completed on or before Probability 75% probability 5 M ar, plan ned 31 M ar, com pletion early completion date late completion Neil Dunkerley 17 th May

20 Wave Analysis This is one project of many. 07/Jan/01 04/Feb/01 04/Mar/01 01/Apr/01 29/Apr/01 27/May/01 24/Jun/01 22/Jul/01 19/Aug/01 Neil Dunkerley 17 th May Completion Date Range 0% 3% 7% 10% 13% 17% 20% 23% 27% 30% 33% 37% 40% 43% 46% 50% 53% 56% 60% 63% 66% 70% 73% 76% 80% 83% 86% 89% 93% 96% 99%

21 Wave Analysis The ranges for all the other projects are also plotted. The red line is the desired finish date for all of the projects. Nationwide Sorted by 75% completion date 07/Jan/01 0% 4% 7% 11% 15% 18% 22% 26% 29% 33% 37% 40% 44% 48% 51% 55% 59% 62% 66% 70% 73% 77% 81% 84% 88% 92% 95% 99% 04/Feb/01 04/Mar/01 Completion Date Range 01/Apr/01 29/Apr/01 27/May/01 24/Jun/01 22/Jul/01 19/Aug/01 Neil Dunkerley 17 th May

22 Project Risk Analysis Clients should understand the outputs Appropriate analysis should be undertaken based upon the available information and within the available time get out what you put in! Enable Clients to gain confidence in cost estimates and programmes Better decision making Successful projects delivered on time and within budget Neil Dunkerley 17 th May

23 Thank You! Neil Dunkerley