Level:
Basic
TCM Section(s)
7.6. Risk Management
11.5. Value Management and Value Improving Practices (VIPs)
Venue: 2024 AACE International Conference & Expo
Abstract: This paper advocates for a re-imagining of how logic networked schedule risk analysis (SRA) can add value to projects.In the authors’ view, SRA should be considered a critical decision-support tool, leveraged to help projects add value by informing executives about risk/rewards trade-offs on many decisions, small and large, throughout the project life cycle.
This approach contrasts with what one frequently observes in practice: SRA used primarily as a highly detailed quantification and assurance tool at the time of final investment decision (FID), to get projects approved and perhaps highlight some risk treatment priorities.These applications are valuable, but they underutilize the potential of SRA for mid-phase incremental decision making while scope and plans are developed, and value is optimized.
This paper offers actionable insights as to how to apply SRA to support incremental decisions. It properly views SRA as supporting asset and project optimization, value and change management: foundational elements of Cost Engineering and Total Cost Management (TCM). A case example is presented, illustrating how one company used SRA to help navigate critical non-FID scope development and planning decisions during Class 4, 3, 2 and execution phase.Highlighted are the many types of decisions that may benefit from the approach, as well as practical tips to use SRA in a more fit-for-purpose manner.In summary, SRA emerges as a dynamic and frequently applied decision-support tool that can add value in new ways during multiple phases in the project life cycle.
TCM Section(s)
7.6. Risk Management
11.5. Value Management and Value Improving Practices (VIPs)
Venue: 2024 AACE International Conference & Expo
Abstract: This paper advocates for a re-imagining of how logic networked schedule risk analysis (SRA) can add value to projects.In the authors’ view, SRA should be considered a critical decision-support tool, leveraged to help projects add value by informing executives about risk/rewards trade-offs on many decisions, small and large, throughout the project life cycle.
This approach contrasts with what one frequently observes in practice: SRA used primarily as a highly detailed quantification and assurance tool at the time of final investment decision (FID), to get projects approved and perhaps highlight some risk treatment priorities.These applications are valuable, but they underutilize the potential of SRA for mid-phase incremental decision making while scope and plans are developed, and value is optimized.
This paper offers actionable insights as to how to apply SRA to support incremental decisions. It properly views SRA as supporting asset and project optimization, value and change management: foundational elements of Cost Engineering and Total Cost Management (TCM). A case example is presented, illustrating how one company used SRA to help navigate critical non-FID scope development and planning decisions during Class 4, 3, 2 and execution phase.Highlighted are the many types of decisions that may benefit from the approach, as well as practical tips to use SRA in a more fit-for-purpose manner.In summary, SRA emerges as a dynamic and frequently applied decision-support tool that can add value in new ways during multiple phases in the project life cycle.