Obtaining 3 point estimates for project schedule risk analysis:
You have prepared and quantified the project risk register. You have finally persuaded the project planner to prepare a suitable programme for Schedule Risk Analysis (SRA). All you need to do now is get the Project Manager to provide 3 point estimates (3PE) for each of the activities in the plan. In practice it is difficult for Project Managers to find the time and motivation to provide these estimates.
This shortcut will get the SRA started and point to activities where more attention is needed.
Ask the Project manager to allocate each activity (or set of activities) into one of four groups. Activities in group A are well understood with little variation in duration, whereas activities in group D are perhaps novel or little understood and large variation in duration.
These groupings can be carried out quickly. The Project Manager may have definite ideas on the 3PE for some of the activities, which of course can be completed separately. At this stage a Monte Carlo analysis can be carried both for uncertainty only and with risks included. Review the tornado diagram using the sensitivity index for the activities will identify the key activities. The 3PEs for these activities can be reviewed and refined.
The justification for this approach is that:-
1. Many of the plan activities will have little or no influence on the outcome of the analysis
2. The outcome of the analysis will be mainly driven by the risks (rather than the activities)
3. The Central Limit Theorem will tend to reduce the overall variation;
4. This approach gives the Project Manager a manageable task which can be completed quickly