Quantitative Project Risk Analysis in Excel Lesson 01

LESSON 1: INTRODUCTION In this course, we teach you how to build a simple and easy-to-understand model on Excel to make a quantitative risk register for projects. No additional software is required beyond Excel. Welcome to the course "Quantitative risk analysis of projects in Excel". I am Fernando Hernandez. I worked for over 17 years as an official consultant and trainer for Palisade Company, the maker of @RISK. @RISK is perhaps the most popular add-in for Monte Carlo simulation as an add-in for Microsoft Excel. The Monte Carlo simulation technique forms the core of this entire course. It is the methodology used to give life to the quantitative analysis of a risk register of any project. This methodology shows virtually all possible outcomes for any situation and tells you how likely they are to occur. This means that you can judge which risks to undertake and which ones to avoid - a critical insight in today's uncertain world. However, for this course we will not deal with additional software licenses such as @RISK or other Monte Carlo simulators. Everything is done with workbooks loaded with Excel macros. Project specialists and managers, and project risk managers in particular, can greatly benefit from this course. Its objective is to go beyond traditional project risk analysis using risk registers and matrices, through the use of powerful simulation techniques that allow the real quantification of risk. A great advantage of this course is that it is carried out with a powerful Excel template loaded with macros that generate all the Monte Carlo simulation, the generation of graphs and the analysis of results. This means that it is not necessary to purchase any software application such as @RISK to complete it. This course begins by explaining traditional qualitative risk registers and matrices. We explain why this risk listing methodology for a project or company is full of weaknesses and flaws, in its attempt to use frequency and severity components to build a risk analysis. In comparison, we will carefully build a case for quantitative risk analysis for a project, using a Monte Carlo simulation approach. Throughout the lessons, we carefully added all the components on how to build a robust risk register, capable of building probabilistic contingencies in a project. We add appropriate distributions to deal with frequency and severity and simulation techniques. This course is very practical. Throughout the course, we will guide you through the basics of setting up an Excel-based model. You will learn how to build a model with inputs and outputs, select distribution functions, run a simulation, and most importantly, you will be able to analyze and interpret the results of your simulation. Remember that no additional software is required other than Excel in versions 2016 onwards. Be sure to download the resources attached to this course. The main resource to use in these lessons is an Excel workbook with macros that can be easily downloaded for free from www.dtsimulator.com. Register as an user, download the model or workbook in its two versions: resolved or not resolved, and proceed to complete the course. The version used for this course is the free version. On the same site you can purchase, if you wish, the full version to perform Monte Carlo simulation analysis in a professional way. During the course, you can work with the incomplete workbook to complete it in parallel according to the given instructions. Another option is to use the finished workbook and follow it as the course unfolds. It all depends on your best learning style. Additionally, you will be able to download here a textual PDF document in color, which contains about 52 pages that explain word by word the complete sequence of the lessons. I hope you enjoy this course! Welcome to "Quantitative Risk Analysis of Projects in Excel".