A Simulation Study

Mario Vanhoucke

Chapter Chapter 4 in Measuring Time, 2009, pp 51-86 from Springer

Abstract: Abstract This chapter presents two extensive simulation studies to test the relevance and accuracy of the concepts and metrics introduced in the previous chapters. The first simulation study has been set up to test the accuracy of the three duration methods (planned value method, earned duration method and earned schedule method) as presented in chapter 1 to predict the final duration of a project. The second simulation study tests the relevance of the schedule adherence concept (measured by the p-factor) as presented in chapter 2. The methodology used is Monte-Carlo simulation to generate activity duration and cost uncertainty in a project network. The literature on project network simulation is rich and widespread, and is praised as well as criticized throughout various research papers. In these simulation models, activity duration/cost variation is generated using often subjective probability distributions without precise accuracy in practical applications. However, the inability of the simulation runs to incorporate the management focus on a corrective action decision making process to bring late running projects back on track, has led to the crumbling credibility of these techniques. Despite the criticism, practitioners as well as academics have used project network models within a general simulation framework to enable the generation of activity duration and cost uncertainties. For a discussion on the (dis)advantages of project network simulation, the reader is referred toWilliams (1999). This issue will not be further discussed in this book.

Keywords: Mean Absolute Percentage Error; Forecast Accuracy; Project Schedule; Precedence Relation; Project Network (search for similar items in EconPapers)
Date: 2009
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Persistent link: https://EconPapers.repec.org/RePEc:spr:isochp:978-1-4419-1014-1_4

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DOI: 10.1007/978-1-4419-1014-1_4

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