Dynamic cost risk assessment for controlling the cost of Naval vessels
MetadataShow full item record
Naval vessels, like most large-capital projects/programs, have a long history of cost growth and overruns. To get a handle on this problem, NAVSEA's Cost Engineering and Industrial Division, NAVSEA 05C, has introduced Probabilistic Cost Risk Analysis (PCRA) into the Department of Defense (DoD) Planning, Programmatic, Budgeting, and Execution System (PPBES). The quantification of cost in terms of Cumulative probability Distribution Functions (CDF) or "S-curves" provides a macroscopic view of project/program risk. Risk curves alone do not provide adequate visibility into the individual project risk drivers; therefore, they are insufficient for planning and managing Risk Reduction Activities (RRA). Complex projects typically involve a set of high-consequence, project-specific risks that require detailed analysis and for which risk response actions need to be developed and implemented. The analysis of specific risks and RRAs requires a microscopic view. We present a practical and mathematically sound approach using scenarios and Monte Carlo simulation within the framework of decision trees and risk curves. The approach is detailed using a realistic but simplified case of a project with three technical risks.
NPS Report NumberNPS-GSBPP-09-023
Showing items related by title, author, creator and subject.
Mortlock, Robert (Monterey, California. Naval Postgraduate School, 2017-07); NPS-AM-17-211This Enhanced Combat Helmet (ECH) case study encourages critical analysis of a U.S. Defense Department project at two key decision points: project start and production. The case centers on the development, testing, and ...
Demir, Kadir Alpaslan (Monterey, California. Naval Postgraduate School, 2008-12);Evaluating, monitoring, and improving the effectiveness of project management can contribute to successful acquisition of software systems. In this dissertation, we introduce a quantitative metric for gauging the effectiveness ...
Chaney, Scott H; Geberth, Roy J. (Monterey, California. Naval Postgraduate School, 1996-09);This thesis examines the travel management reengineering project of one DoD command. It analyzes the process selection, redesign, and implementation of the travel project and discusses the managerial implications of the ...