Constructively simple estimating: a project management example

Published on Oct 1, 2003in Journal of the Operational Research Society1.754
· DOI :10.1057/palgrave.jors.2601610
Chris Chapman22
Estimated H-index: 22
(University of Southampton),
Stephen Ward22
Estimated H-index: 22
(University of Southampton)
A 'constructively simple' approach to estimating uses a decision support modelling paradigm based on project risk management and operational research concepts. It employs probability models selected from a set of alternative stochastic models of uncertainty with a view to maximising the insight provided, given an appropriate level of complexity. It addresses issues that include the joint use of subjective and objective probabilities, subjectivity of model data and structure, bias, data acquisition costs, the importance of getting an estimate right, optimising the estimating processes involved as a whole in approximate but robust terms, and differences in interpretation of what this means to estimators and users of estimates. Specific applications are necessarily context-specific to some extent, but the underlying ideas are of general applicability. This paper uses a simple example involving estimating the uncertain duration of a project activity to illustrate what is involved.
  • References (9)
  • Citations (32)
#1Stephen Ward (University of Southampton)H-Index: 22
#2Chris Chapman (University of Southampton)H-Index: 22
This paper argues that all current project risk management processes induce a restricted focus on the management of project uncertainty. In part this is because the term ‘risk’ encourages a threat perspective. In part this is because the term ‘risk’ has become associated with ‘events’ rather than more general sources of significant uncertainty. The paper discusses the reasons for this view, and argues that a focus on ‘uncertainty’ rather than risk could enhance project risk management, providing...
389 CitationsSource
#1Chris ChapmanH-Index: 22
#2Stephen WardH-Index: 22
This title confidently puts forward a practical, new approach to decision making in an uncertain business world. Many variables are accounted for and the authors are innovative in integrating previous types of decision-making approaches with a more fluid, and therefore realistic model that can be applied across a wide range of contexts and decisions. A new title on a important topic that not only stands well on its own, but also complements Chapman and Ward's previous title Project Risk Manageme...
82 Citations
#1Chris Chapman (University of Southampton)H-Index: 22
#2Stephen Ward (University of Southampton)H-Index: 22
This paper describes an approach to the estimation and evaluation of uncertainty designed for ease of use. It is designed to be easier to use than probability impact grid based approaches, and it links qualitative approaches in this format to quantitative approaches. It is based on a general view of uncertainty which incorporates ambiguity as well as variability and lack of data. A concern for identifying sources of uncertainty is one characteristic of the approach which flows from this perspect...
61 CitationsSource
This paper examines in detail reasons for using constructively simple models in management science interventions. Constructive simplicity is an objective concept describing the form and level of detail in a model. It is distinguished from the subjective concept of transparency, which relates to user-comprehension of a model. Usual arguments for constructive simplicity focus on model-building considerations such as model clarity, flexibility and convenience. Constructively simple models are also ...
87 CitationsSource
Describes the current status of SCERT (synergistic contingency evaluation and response techniques). SCERT is an attempt to provide a systematic approach to the planning and financial evaluation of large engineering projects involving significant risks. Its mathematical basis is a decision tree/semi-Markov process representation of a project. This basis is integrated with qualitative risk assessment procedures. The emphasis is preplanning positive responses to potential contingencies, the need to...
46 CitationsSource
Lecture to the memory of Alfred Nobel, December 8, 1978(This abstract was borrowed from another version of this item.)
1,898 Citations
#1Bernard EdwardsH-Index: 1
#2Paul G. HoelH-Index: 5
Last. Raymond J. JessenH-Index: 7
view all 3 authors...
19 Citations
#1Joseph J. ModerH-Index: 3
#2Cecil R. PhillipsH-Index: 3
210 Citations
#1Douglas A. LindH-Index: 4
#2William G. MarchalH-Index: 4
Last. Samuel A. WathenH-Index: 3
view all 3 authors...
Brief Contents 1 What Is Statistics? 2 Describing Data: Frequency Distributions and Graphic Presentation 3 Describing Data: Numerical Measures 4 Describing Data: Displaying and Exploring Data 5 A Survey of Probability Concepts 6 Discrete Probability Distributions 7 Continuous Probability Distributions 8 Sampling Methods and the Central Limit Theorem 9 Estimation and Confidence Intervals 10 One-Sample Tests of Hypothesis 11 Two-Sample Tests of Hypothesis 12 Analysis of Variance 13 Linear Regressi...
116 Citations
#1Frank H. KnightH-Index: 27
In Risk, Uncertainty and Profit, Frank Knight explored the riddle of profitability in a competitive market profit should not be possible under competitive conditions, as the entry of new entrepreneurs would drive prices down and nullify margins, however evidence abounds of competitive yet profitable markets. To explain this seeming paradox, Knight uncovers the distinction between calculable risk and essentially unknowable uncertainty. Knight argued that risk stems from repeated events, which the...
8,410 Citations
Cited By32
#1Sang Quang Van (VNUHCM: Vietnam National University, Ho Chi Minh City)
#2Long Le-Hoai (VNUHCM: Vietnam National University, Ho Chi Minh City)H-Index: 5
Last. Chau Ngoc Dang (Ton Duc Thang University)H-Index: 2
view all 3 authors...
Purpose The purpose of this paper is to predict implementation cost contingencies for residential construction projects in flood-prone areas, where floods with storms frequently cause serious damage and problems for people. Design/methodology/approach Expert interviews are conducted to identify the study variables. Based on bills of quantities and project documents, historical data on residential construction projects in flood-prone areas are collected. Pearson correlation analysis is first used...
#1Stephan Schöning (Heidelberg University)
#2Çağla Ersen Cömert (Marmara University)
In a globalized world, there is a need for all sizes of companies to implement a risk management system. However, empirical research shows that SMEs quite often have deficits in this area and, as a consequence, are susceptible to severe crises. There are risk management systems for SME and this raises the question, why these systems are not implemented yet. The research project focusses on identifying possible reasons for this situation resulting from the attitude of management towards risk mana...
The cyber-physical gap (CPG) is the difference between the ‘real’ state of the world and the way the system perceives it. This discrepancy often stems from the limitations of sensing and data collection technologies and capabilities, and is inevitable at some degree in any cyber-physical system (CPS). Ignoring or misrepresenting such limitations during system modeling, specification, design, and analysis can potentially result in systemic misconceptions, disrupted functionality and performance, ...
2 CitationsSource
This paper provides an account of how systems engineering principles are applied by the Norwegian government to improve up-front planning and decision-making of large public investment projects, as well as the effect of these efforts after 15 years of operations. It suggests that the results are promising, both in securing budgetary compliance, but also to ensure conceptual solutions that are economically viable in a life-time perspective.
1 CitationsSource
#1Dilek Zamantili Nayir (Marmara University)H-Index: 8
Wahrend das Thema „Risikomanagement“ in fruheren Jahren eher als eine Art „Nebensache“ angesehen wurde, ist es heute zu einem Thema geworden, mit dem sich die Fuhrungsebene einer Organisation personlich beschaftigt. Studien zu diesem Themenbereich konzentrierten sich zunachst primar auf die finanzielle Perspektive und es handelte sich um ein Gebiet, mit dem sich Rechnungswesen- und Finanzexperten beschaftigten. In den letzten Jahren sind Studien zum Risikomanagement zunehmend auf den menschliche...
The Anthropocene calls for systemic change which requires much more than good ideas, stakeholder activism and self-organization. Successful change is managed in the form of a project. However, project management itself needs to learn to cope with the systemic complexity of the real world, especially with social complexity. Hence, this paper explores the paradox of reintroducing complexity within a discipline that has professionalized the reduction of complexity. Acknowledging the inevitability o...
1 CitationsSource
The recent financial crises in America and Europe have shown emphatically that the findings of the relevant risk management literature concluding that lurking risks can be converted into opportunities have unfortunately not informed policy. The assumption of the risk as a burden, often leads economies to crises that undermine the development and prosperity of states and citizens. In this context, this article aims at highlighting risk characteristics and presentation of basic management principl...
New fast track construction projects worth more than $100 billion are being implemented in Makkah to improve services being rendered to millions of pilgrims who come for Hajj and Umrah. The new development projects in Makkah, including largest expansion of the Grand Mosque. The time factor has become increasingly as an outstanding requirement on this construction projects. In the present work, the question "acceleration of construction projects" is moved in the center. Consequently, innovative s...
1 CitationsSource
#1Michela Arnaboldi (Polytechnic University of Milan)H-Index: 18
#2Irvine Lapsley (Edin.: University of Edinburgh)H-Index: 30
Purpose – The purpose of this paper is to analyse enterprise risk management (ERM), its organizational translation and fit, investigating in particular its impact on a major control process: budgeting. Design/methodology/approach – The research was carried out with a multiple case study approach including three companies in the UK. This approach was chosen to gain a deeper understanding of the nature of ERM within each of the organizations and the factors shaping its achievements. Findings – Thr...
1 CitationsSource
Projects should create value. That is the desire and plan, but uncertainties cloud the paths to this destination. All project work should add value in terms of both the resources consumed and the benefits provided (e.g., scope, quality, technical performance, features, and functions), yet adding value is not always straightforward. Conventional techniques such as earned value management focus on time and cost but do not address quality, uncertainty, risk, and opportunity. An integrated approach ...
22 CitationsSource