QUALITY AND PROJECT RISK MANAGEMENT OBS-UB

ASSESSMENT 3
RIKS TOOLS

DAVID DOBLAS MONTSERRAT

09/03/2019

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QUALITY AND PROJECT RISK MANAGEMENT OBS-UB

SUMMARY SITUATION
After identifying different threats and opportunities I’m going to simulate different scenarios,
then I’ll use all this information.

RISK 1 THREAT-REPAIR
PROBABILITY 40%
MINIMUM IMPACT 40.000€
MORE LIKELY IPACT 50.000€
MAXIMUM IMPACT 90.000€

RISK 2 THREAT-OVERTIME
PROBABILITY 30%
MINIMUM IMPACT 0€
MORE LIKELY IPACT 30.000€
MAXIMUM IMPACT 120.000€

RISK 3 OPPORTUNITY-INCENTIVE
PROBABILITY 70%
IMPACT -20.000€

RESOLUTION
Using palisade software, I have taken risk triangle distribution for risk 1 and 2.

For the risk 3, I considered a negative impact (we will receive this money) with a chance
occurrence of 70%, because I have considered (100% – (risk 2)) since I have no more
information.

Uncertain inputs parameters triangle distribution

Event Probability Occurs Impact if occurs Actual impact Probability of not occurring minimum more likely maximum
repair 0,010 0 $60.000 $0 0,990 40000 50000 90000
staff overtime-on time 0,300 0 $50.000 $0 0,700 0 30000 120000
opportunity 0,700 1 -$20.000 -$20.000 0,300

Sums 1 $90.000 Product 0,208

Output
Total actual impact -$20.000

Summary statistics
Mean total impact -$20.000
Stdev total impact $0
P(total impact equals 0) 1,0000
P(total impact > $1 million) 0,0000

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QUALITY AND PROJECT RISK MANAGEMENT OBS-UB

QUESTIONS.
What are its characteristics?
The result shows us a high probability where we receive money thanks to the incentive, after
we have a high probability as well to use the exact budget that we planned.
Then looks like a normal distribution between 0€ and 60.00€ where the maximum is around
25.000€.

What is the cost contingency reserve for a confidence of 85%?

According to the analysis we need a contingency reserve of 33066,46€ for a confidence of 85%.