Review the Monte Carlo Analysis method presented in Chapter 15 in Practical Project Risk Management. ?Then, determine whether you would recommend to a project manager the ?use of thi

Week 6 Discussion – Advanced Risks Tools

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Please respond to the following:

• Review the Monte Carlo Analysis method presented in Chapter 15 in Practical Project Risk Management.  Then, determine whether you would recommend to a project manager the  use of this methodology for a large, complex project. Include an example  to support your response. If you would not recommend the use of a  method such as Monte Carlo, explain what you would recommend as an  alternative tool that would allow the project manager to make informed  decisions. Provide a rationale for your recommendation.

Be sure to respond to at least one of your classmates' posts.

Respond to student below

Angel Thyagarajan         

Yesterday Aug 10 at 1:52pm          

I  would recommend using Monte Carlo Simulation for large complex projects.  These algorithms build extremely accurate variations or probability of  the data and it can be a great assistance for extreme uncertain  situations. This algorithm is tested using different input variables and  can provide a large number of possible outcomes.

Risks are based on the probability of different occurrence, functions  and the extent of the damage. Monte simulations delivers a reliable  results based on the quantification of the risks through a large number  of random experiments. It includes the dependencies between the risks  into the account and it results ranges widely (1).

This Monte Carlo tool for risk management allows to carry analysis of  overall risk situation and assists with the targeted query of risk  information. It assists with mapping the risk management process to risk  analysis and are able to provide information for the management to make  appropriate decisions.

For example, to get the distance between the home and office is  mostly fixed but the probability using Monte Carlo simulation might  predict different travel times by considering different factors such as  congestion, bad weather, and vehicle breakdowns(2). 

Sources:

1. “Monte Carlo”, NA. What is a Monte-Carlo simulation?. https://www.gbtec.com/resources/monte-carlo-simulation/ 

•  Links to an external site.
• “AWS Monte Carlo”, NA. What Is The Monte Carlo Simulation?. https://aws.amazon.com/what-is/monte-carlo-simulation/#:~:text=The%20Monte%20Carlo%20simulation%20is%20a%20probabilistic%20model%20that%20can,home%20and%20office%20is%20fixed 

 Links to an external site..