Part 2: Navigating Project Uncertainties and "What-If" Analysis 🌊🏗️What-If Analysis: An OverviewPurpose:🔹Proactive risk assessment to...
Published on by Hossein Ataei Far, Deputy Manager of the Research, Technology Development, and Industry Relations Center at NWWEC
What-If Analysis: An Overview
Purpose:
🔹Proactive risk assessment tool.
🔹Identifies potential issues impacting project success.
🔹Helps formulate mitigation strategies for effective risk management throughout the project lifecycle.
Steps to Conduct a What-If Analysis:
📋 Define the Scope:
🔹Identify the project phase (planning, design, construction, etc.).
🔹Determine specific aspects to focus on (technical, financial, legal, etc.).
👥 Assemble a Multidisciplinary Team:
🔹Include experts from engineering, legal, finance, project management, and safety.
🔹Ensure team members have relevant knowledge and adhere to ASCE guidelines.
🧠 Identify Potential Scenarios:
🔹Brainstorm potential "What-If" scenarios.
🔹Consider risk categories: technical failures, regulatory changes, financial challenges, and environmental factors.
❓ Develop What-If Questions:
🔹Formulate specific questions for each scenario. Examples:
🔹What if a critical supplier fails to deliver on time?
🔹What if there is a sudden regulatory change?
🔹What if the project site experiences extreme weather conditions?
🔍 Analyze Each Scenario:
🔹Assess the likelihood and impact.
🔹Use qualitative and quantitative methods.
🔹Consider worst-case, best-case, and most likely outcomes.
📝 Document Findings:
🔹Record risks, impacts, and likelihood of occurrence.
🔹Maintain a detailed log of the analysis process and findings.
🛡️ Develop Mitigation Strategies:
🔹Propose strategies to mitigate identified risks.
🔹Prioritize risks based on impact and likelihood.
🔹Develop contingency plans for high-priority risks.
🔄 Review and Update Regularly:
🔹Continuously monitor the project for new risks.
🔹Update the What-If analysis as needed.
🔹Reassess scenarios and strategies regularly or when significant changes occur.
📝 How to perform what-if analysis:
🔹Step 1: Identify factors and trends you want to test for
🔹Step 2: Set your baseline plan and strategy
🔹Step 3: Prioritize potential what-ifs
🔹Step 4: Build a scenario or sensitivity analysis
🔹 Step 5: Run your analysis
🔹Step 6: Assess results
References
[1] Project Management Institute (PMI). (2021). PMBOK® Guide. Project Management Institute. Link to PMBOK Guide
[2] American Society of Civil Engineers (ASCE). (2020). Civil Engineering Body of Knowledge for the 21st Century. American Society of Civil Engineers. Link to ASCE
[3] ISO 31000:2018. (2018). Risk Management
[4] Hillson, D. (2017). Practical Project Risk Management: The ATOM Methodology. Management Concepts. Link to book
[5] Chapman, C., & Ward, S. (2011). Project Risk Management: Processes, Techniques, and Insights. Wiley.
[6] https://lnkd.in/dx-WzYST
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