Event Chain Methodology

Schedule risk analysis technique that focuses

on managing risk events affecting project
schedules and relationship between them
 Original Project Schedule

Risk Adjusted Project Schedule

Project slips due to the risks

and uncertainties
 Statistical Distribution of
Task Durations

????
 Risks Affecting Project Schedule

Risk Probability Impact Score

Person left a project team
Some materials did not arrive on time
Bad weather
…..
…..
…..
…..
 Risks Evens are Related to Each Other

Event 1

Event 2

Event 3
Principle 1: Single Events
Statistical distribution for
moment of event

Event 1 Event 2

Ground Excited State 1 Excited State 2

State
Excitation
 Principle 2: Event Chains
Event Chain
Event 1

Event 2

Event 3
 Event Chain: Event 1 triggered a response event after some time
Event
Structural Event: Execute
defect is Response Plan
discovered

Risk Response
Is completed
Entry point
Exit
Point

Execution of
Response Plan
Risk Response Plan
“Repair”
 Risk Transfer

Event 1

Event 1
Transferred
Principle 3: Event Chain Diagrams
Closed or Closed
transferred issue
Issue risk

Threat

Opportunity
State: New Requirements
 Risk Probability and Impacts

Low impact

High probability and impact

 Event Chains on Event Chain Diagrams
Event Chain
Event 1

Event 2
0.5

Event 4
 Event Chain Executes an Activity
Event 1
Event Chain:
Event triggers
activity
 Event Chain Executes a Group Activities
Event 1
Event Chain:
Event triggers
group of
activities
 State Table
Task: Software Development
Event 2:
Event 1: Event 3:
Problem with
Architectural Minor
development
changes requirement change
tool
Probability: 20% Probability: 10%
Moment of event: any time Moment of event: any time
Ground State Excited state: refactoring Excited state: refactoring
Impact: delay 2 weeks Impact: delay 1 week
Probability: 10%
Excited state: Moment of event: start of the state
Excited state: minor code change
refactoring Impact: delay 2 days

Excited state:
minor code change
 Principle 4: Monte Carlo Simulations
Duration Cost
53% chance that Duration w ill be less than 121.03 (day) 52% chance that Cost w ill be less than 95,977.01 ($)
Determ. Determ.
18%
100% 25% 100%

16% 90% 136.90 23% 90% 106361.45

14% 80% 20% 80%

70% 18% 70%

12%

60% 15% 60%

10%
Mean Mean
50% 121.17 13% 50% 96131.69
8%
40% 10% 40%

6%
30% 8% 30%

4%
20% 5% 20%

2% 10% 3% 10%
109.49 90514.93

0% 0% 0% 0%
25.00 50.00 75.00 100.00 125.00 150.00 175.00 25,000.00 50,000.00 75,000.00 100,000.00 125,000.00 150,000.00
Duration (day) Cost ($)
 Schedule and Non-Schedule Risk Categories

Event 1 Impact:
Schedule – 20% Schedule related
Cost – 30% categories
Performance – 50%
Quality – 45% Non-schedule
Litigation – 25% categories
Safety – 40%
Security – 30
Integrated Impact – 50%
Principle 5: Critical Event Chains

Critical Event
Chain
 Principle 6: Project control with events
Low estimate of High estimate of
project duration project duration
100%
% Complete

Project Duration
 Risks Risk response increases a chance of
Chance of 100% the project meeting the deadline
project meeting
a deadline
80%
(Project Success
Rate)
60%
Chance of meeting the
deadline is reduced as a result
40% of events
Risk response plan
20%

0%
0 2 4 6 8 10 12
Project Duration, Weeks
Project Risk Analysis Made Ridiculously Simple
A Step by Step Guide to Project Risk Analysis
by Lev Virine and Michael Trumper

Hardcover: 284 pages

Publisher: World Scientific Publishing Co (March 5, 2017)
Language: English
ISBN-10: 9814759376
ISBN-13: 978-9814759373

Web site: www.projectdecisions.org