Case Study: Monte Carlo

256 Words2 Pages
1. Why aren’t risk analysis tools like Monte Carlo simulation and decision tree analysis more common in analyzing IT project risks? Risk analysis tools like Monte Carlo simulation and decision tree analysis are not more common in analyzing IT project risks because a Monte Carlo simulation is done by random generations while decision tree analysis is figured by chance. These random generations do not predict specific results. 2. What could be done so that CIOs and IT project managers would be more apt to use these tools? I believe CIO and IT project managers could possibly benefit from using these tools but only to a certain extent. I think it would be a good idea to use these tools as an idea for their own prediction, and then using other methods to find a more precise estimation. 3. Suppose you are the project manager for an ERP project. Provide an example of a situation where Monte Carlo simulation would be appropriate. Also provide an example of a situation where decision tree analysis would be appropriate. A time when I believe a Monte Carlo simulation would be appropriate is in statistics. When a project manager wants to know all of the possible outcomes based on statistics, it would be a good idea to use a Monte Carlo simulation. One time a decision analysis tree would be applicable is during investments. A decision tree can be looked at to see all of the possible outcomes from an investment and then making a decision based on the

More about Case Study: Monte Carlo

Open Document