Project Risk Management: Essential Methods for Project Teams and Decision Makers

CHAPTER THREE

Adequacy of Methods to Assess Project Uncertainties

Questions Addressed in Chapter 3

• What distances to reality do various risk methods have?
• What is a minimal set of adequate methods that covers all types of project uncertainty objects?
• How may we recognize ersatz or pseudo risk management methods?
• Why is icon painting somehow relevant to risk management?

PART II OF THE BOOK is devoted to applications of deterministic methods in risk management. Part III describes the power of the probabilistic technique. Both deterministic and probabilistic methods could be either qualitative or quantitative. This difference might be blurred in some cases. We review these four situations in this chapter in anticipation of more detailed discussion in Parts II and III. To anticipate conclusions coming from this overview, I would state that only deterministic qualitative and probabilistic quantitative methods look fully authentic. Most of the other methods (probabilistic qualitative and deterministic quantitative ones) look like epigone-type ones. Those could be considered attempts at the merger of authentic risk methods with methods of estimating and scheduling.

It is important to select adequate methods to assess various uncertainties that give rise to overall project outcome uncertainty (Figure 1.1). Adequacy of methods may be introduced through contemplating their distances ...