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Topics: Organizational Project Management, PMI Standards, Risk Management
i cant solve this question related to risk



i cant solve this question related to risk " if your project has to end before 15/1/2018 and you have two subcontractors ( a his probability is 80 % and confidence level is 40 % ) and ( b his probability 70 % and confidence level is 70 % ) which one you will choose " i confused i dont have any impacts or values i can calculate EMV with it , could any one plz explain how to solve ?
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PMBOK 6 ch11 Table 11-1 p. 407. alludes to what this question is asking. The first contractor has a higher risk probability associated with their work, and will have a greater impact on the project. Option two isn't any better, but that subcontractor has a higher confidence level, or ability to finish the project. Refer to that table and section for more information.
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1 reply by Mohamed Afify
Oct 24, 2017 2:17 PM
Mohamed Afify
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sorry but my pmbok is 978 pages & 407 that you mention is in communication chapter
could you specific the clause you are taking about more



I'm going to assume, Mohammed, that your problem can re-written like this.
1. Subcontractor A states a probability of 80% that it can complete the contracted work by January 15, 2018. You have assigned an 40% confidence that the subcontractor will do so.
2. Subcontractor B states a probability of 70% that it can complete the contracted work by January 15, 2018. You have assigned a 70% confidence that the subcontractor will do so.

Given this problem, you can simply treat your confidence level as your probability of that subcontractor completing the work in the given deadline.

You then wind up with an overall probability that is equal to the multiplication of both probabilities. (Ptotal = Psub X Ppm).

That resolves to an overall probability of 32% for subcontractor a and 49% for subcontractor b.
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1 reply by Mohamed Afify
Oct 24, 2017 2:21 PM
Mohamed Afify
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first thanx for more detailing my question
but iam confused about alot of things
the probability is 80 % , that is mean that the subcontractor has this probability to finish the project or has this probability as a risk threaten on my project ??

so the final values 32 % & 49 % , is good to take the larger as a chance to finish on time or take smaller as it has a smaler risk



Oct 24, 2017 2:07 PM
Replying to Ed Tsyitee Jr
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PMBOK 6 ch11 Table 11-1 p. 407. alludes to what this question is asking. The first contractor has a higher risk probability associated with their work, and will have a greater impact on the project. Option two isn't any better, but that subcontractor has a higher confidence level, or ability to finish the project. Refer to that table and section for more information.
sorry but my pmbok is 978 pages & 407 that you mention is in communication chapter
could you specific the clause you are taking about more
...
1 reply by Ed Tsyitee Jr
Oct 25, 2017 2:03 PM
Ed Tsyitee Jr
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Chapter 11 in PMBOK is Project Risk Management. For the PMBOK 6 edition, table 11-1 is the table to refer to. It can be found on page 407. I hope this helps.



Oct 24, 2017 2:07 PM
Replying to Stéphane Parent
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I'm going to assume, Mohammed, that your problem can re-written like this.
1. Subcontractor A states a probability of 80% that it can complete the contracted work by January 15, 2018. You have assigned an 40% confidence that the subcontractor will do so.
2. Subcontractor B states a probability of 70% that it can complete the contracted work by January 15, 2018. You have assigned a 70% confidence that the subcontractor will do so.

Given this problem, you can simply treat your confidence level as your probability of that subcontractor completing the work in the given deadline.

You then wind up with an overall probability that is equal to the multiplication of both probabilities. (Ptotal = Psub X Ppm).

That resolves to an overall probability of 32% for subcontractor a and 49% for subcontractor b.
first thanx for more detailing my question
but iam confused about alot of things
the probability is 80 % , that is mean that the subcontractor has this probability to finish the project or has this probability as a risk threaten on my project ??

so the final values 32 % & 49 % , is good to take the larger as a chance to finish on time or take smaller as it has a smaler risk
...
1 reply by Stéphane Parent
Oct 24, 2017 2:38 PM
Stéphane Parent
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I don't know, Mohammed. You have not given me enough information to know if the probability is the likelihood of the contractor meeting or NOT meeting the deadline.

Because you had "confidence level", I presumed that probability was likelihood of success, not failure. (Confidence level is really just another name for probability of success.)

If the probability in the question is of failure, then that changes the formula. to Ptot = (1 - Psub) X Ppm. (Slightly more cryptic which I presumed was not intended.)

In both my initial example and second example, Ptot is the probability of success.



Oct 24, 2017 2:21 PM
Replying to Mohamed Afify
...
first thanx for more detailing my question
but iam confused about alot of things
the probability is 80 % , that is mean that the subcontractor has this probability to finish the project or has this probability as a risk threaten on my project ??

so the final values 32 % & 49 % , is good to take the larger as a chance to finish on time or take smaller as it has a smaler risk
I don't know, Mohammed. You have not given me enough information to know if the probability is the likelihood of the contractor meeting or NOT meeting the deadline.

Because you had "confidence level", I presumed that probability was likelihood of success, not failure. (Confidence level is really just another name for probability of success.)

If the probability in the question is of failure, then that changes the formula. to Ptot = (1 - Psub) X Ppm. (Slightly more cryptic which I presumed was not intended.)

In both my initial example and second example, Ptot is the probability of success.



Oct 24, 2017 2:17 PM
Replying to Mohamed Afify
...
sorry but my pmbok is 978 pages & 407 that you mention is in communication chapter
could you specific the clause you are taking about more
Chapter 11 in PMBOK is Project Risk Management. For the PMBOK 6 edition, table 11-1 is the table to refer to. It can be found on page 407. I hope this helps.



From the information provided and rephrase by Stéphane in is first post. The answer is clear.

To me the 80% should be success, I rarely see people taking about chance of failure in this context.



I'd go with what Stephane did & take the larger value which is 70%, 70% = (49%)

The best result of ( P*C ) shall be the greatest



I'd with what Stephane suggested and option A is suitable in this situation

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