After some breaks, we continue to discuss Monte Carlo Simulation Challenges!
Originally, I hadn't planned to discuss this challenge as I thought it is obvious, but previous comments show that some planners use "pictures" as the base for Schedule Risk Simulation.
If a project timeline is based on 'top-level estimations, it is just a picture. The picture could be drawn by different tools: highlighters, PowerPoint or a Gantt Chart generator. From plannig perspetiev the value of these pictures is exactly the same.
Such pictures could be used to draw other pictures: Probability Distribution and Scatter Diagram. It is NOT how the Monte Carlo Simulation Method should be applied to forecast project delivery, taking project uncertainties into account.
If the base for the risk simulation is a picture, the result is just another picture. If a project Risk Simulation tool only works with top-down estimations, it can be used to draw nice pictures to justify the desired results but can’t calculate reliable probabilities.
Drawing risk distribution pictures in a complex way with the scientific method may create the impression of accuracy, but the reliability of such predictions is extremely low. Usually, it is so low that the P80 prediction has zero chance of being achieved.
In project management Monte Carlo Simulation has to be applied in the following way:
Read more:
https://saluteenterprises.com.au/monte-carlo-simulation-challenges-pictu... [1]
Regards,
Alex Lyaschenko