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Sensitivity and Common Cause Effects

  • Ivan Damnjanovic
  • Kenneth Reinschmidt
Chapter
Part of the Risk, Systems and Decisions book series (RSD)

Abstract

In this chapter we discuss the sensitivity of the project performance outcomes such as the total project cost to the uncertainty in work packages. We provide two approaches to this critical step for developing risk mitigation strategies, one based on calculating derivatives of the total variance with the respect to work package of interest, and the other one based on the correlation between the total cost and the work package. Further, this chapter introduces another important analysis for designing proper mitigation strategies – determining the effects of common cause events on the correlation and ultimately on the total cost.

Keywords

Sensitivity Common cause events Correlation 

References

  1. Pearson ES, Tukey JW (1965) Approximate means and standard deviations based on distances between percentage points of frequency curves. Biometrika 52(3–4):533–546MathSciNetCrossRefGoogle Scholar
  2. Wilkinson L (2006) Revising the Pareto chart. Am Stat 60(4):332–334MathSciNetCrossRefGoogle Scholar
  3. Wright S (1921) Correlation and causation. J Agric Res 20(7):557–585MathSciNetGoogle Scholar

Copyright information

© Springer Nature Switzerland AG 2020

Authors and Affiliations

  • Ivan Damnjanovic
    • 1
  • Kenneth Reinschmidt
    • 2
  1. 1.Texas A&M UniversityCollege StationUSA
  2. 2.College StationUSA

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