Risk, Opportunity, Uncertainty and Other Random Models

Alan R. Jones

• Publisher: Routledge
• Year: 2018
• Print ISBN: 9781138065055
• eBook ISBN: 9781351661294
• Edition: 1
• Topic: Business
• Subtopic: Previsioni
• Index: Business

Risk, Opportunity, Uncertainty and Other Random Models (Volume V in the Working Guides to Estimating and Forecasting series) goes part way to debunking the myth that research and development cost are somewhat random, as under certain conditions they can be observed to follow a pattern of behaviour referred to as a Norden-Rayleigh Curve, which unfortunately has to be truncated to stop the myth from becoming a reality! However, there is a practical alternative in relation to a particular form of PERT-Beta Curve.

However, the major emphasis of this volume is the use of Monte Carlo Simulation as a general technique for narrowing down potential outcomes of multiple interacting variables or cost drivers. Perhaps the most common of these in the evaluation of Risk, Opportunity and Uncertainty. The trouble is that many Monte Carlo Simulation tools are 'black boxes' and too few estimators and forecasters really appreciate what is happening inside the 'black box'. This volume aims to resolve that and offers tips into things that might need to be considered to remove some of the uninformed random input that often creates a misinformed misconception of 'it must be right!'

Monte Carlo Simulation can be used to model variable determine Critical Paths in a schedule, and is key to modelling Waiting Times and cues with random arisings. Supported by a wealth of figures and tables, this is a valuable resource for estimators, engineers, accountants, project risk specialists as well as students of cost engineering.

Table of contents

• Cover
• Title
• Copyright
• Dedication
• Contents
• List of Figures
• List of Tables
• Foreword
• 1 Introduction and objectives
• 2 Norden-Rayleigh Curves for solution development
• 3. Monte Carlo Simulation and other random thoughts
• 4 Risk, Opportunity and Uncertainty: A holistic perspective
• 5 Factored Value Technique for Risks and Opportunities
• 6 Introduction to Critical Path and Schedule Risk Analysis
• 7 Finally, after a long wait ... Queueing Theory
• Epilogue
• Glossary of estimating and forecasting terms
• Legend for Microsoft Excel Worked Example Tables in Greyscale
• Index