Project probabilities


Posted on 22nd September, by JimYoung in Blog. No Comments

We don’t need expensive software to answer questions such as:

  1. When do we reasonably expect to complete our project?
  2. What’s the probability of completing our project on time or on a given date?
  3. Which tasks on the critical path should we focus on to meet the schedule?
  4. With a 95 percent confidence level how much will our project cost?
  5. How much variance is associated with the total man-hours we’ve estimated for this project?

Well, here’s a worked example.  We need a calculator with a square root function.  Given the task durations below, what’s the probability of completing this project in 13 days?

picture 1

First we calculate variance and standard deviation along the
critical path:

hk

Based the probability distribution table, the Z Score of 0.46 provides a probability of 0.1772, and since 13 is less than BET we subtract 0.1772 from 0.5.  The resultant 0.3228 is the probability (ie, 32%) that the project will be completed in 13 days.  Easy eh?  But like all such estimates, it’s only as good as the input data.

So now if our client asks “What’s the likelihood of the project being completed by Xmas?” we know to run a mile!

Probability Distribution Table 

bv





Comments are closed.



Blog

My latest thoughts on Project Management and life.

Free Book: “Managing Smaller and Medium-Sized Projects” by Dr Jim Young PMP

I acknowledge with sincere appreciation the contributions to this book from numerous clients, student, colleagues, friends and project management practitioners. Their sometimes unwitting input...

The “Lean” Project

Lean is an often-used adjective in business these days, but there’s some confusion over its exact definition. In essence, the goal of Lean is...

Monte Carlo Simulation

The Project Management Body of Knowledge (PMBOK Edition 6) advocates the use of Monte Carlo simulation for performing quantitative risk analysis.

In the project management...