Industries / Capital projects and construction
QCRA and QSRA for defensible estimates, risk contingency and completion dates.
ModelRisk
Tamara
ModelChoice
PelicanTotal cost of a warehouse build
10,000 futures
The base estimate holds in 12.5% of futures. A P80 budget needs $1.8M of contingency.
Clients in capital projects and construction
The lifecycle
From the bid to the last change order, each stage has its own question. Pick one to jump to it.
Questions we answer
Charts marked with a model code come from a free example model you can open in Excel. The others are marked illustrative.
ModelChoiceCompare the options with their risks before the business case is fixed. In the water treatment example, upgrading the existing plant has the best expected value, −$71.7M, even with its chance of failing the new standards; a new membrane plant comes out at −$134.3M.
ModelRiskSimulate the threats and opportunities in your register instead of adding up probability times impact. In the hospital extension example the register's expected value is $4.03M, and 80% confidence needs $6.05M.
TamaraRun the risks against the programme itself and see which activities drive the finish date. The bridge in this example has a 57.9% chance of opening within its 44-week contract; P80 is 45.6 weeks.
With most likely durations the bridge opens in week 40, four weeks inside the contract.
Four paths must all finish before the girders go up, so the latest sets the pace: P80 is week 45.6.
ModelRiskLate projects cost more, so cost and time move together. In the treatment works example the chance of meeting both targets is 71.1%; multiplying the two separate chances would give 62.6%.
ModelRiskModel the developer's monthly cash flow with its delays and overruns. A $40M facility is exceeded in 25.2% of futures; 80% confidence needs $40.4M.
ModelRiskCompare procurement strategies on the same price paths. A forward contract for all the steel costs $0.22M more on average than buying at market, and cuts the 1-in-10 cost from $18.07M to $15.97M.
Mean $15.46M · 1 in 10 above $18.07M
ModelRiskTreat change orders and rework as a random number of events of random size. A 5% allowance is exceeded in 66.4% of futures; 80% confidence needs 7.0% of the contract.
PelicanOne shared register for every project, with owners and actions. It exchanges risks and results with Tamara and takes in results from your ModelRisk models, so the register and the numbers stay in step.
| Project | Risk | Owner | Before | After | Status |
|---|---|---|---|---|---|
| Riverside Tower | Ground conditions worse than the survey | Geotechnical lead | 16 | 8 | Mitigating |
| Harbour Bridge | Steel supplier fails to deliver | Procurement manager | 15 | 6 | Mitigating |
| Metro Depot | Late design changes from the client | Design manager | 12 | 6 | Open |
| Hospital Wing | Planning permit delayed | Planning manager | 12 | 4 | Mitigating |
| Water Works | Crane capacity short at peak | Site manager | 9 | 4 | Closed |
How it fits together
The same risks feed the estimate and the programme, and the results go back to the register.
PelicanCapture the risksThreats, opportunities, owners and actions in one register.ModelRiskCost themEstimate ranges and risk events in Excel give the P50 and P80 budget.TamaraSchedule themThe same risks on the P6 or Microsoft Project programme give the P80 date.PelicanReport backResults return to the register for the board and the portfolio view.Free example models
Each one is an Excel workbook with the method explained on its own sheet. They run in the free ModelRisk trial.
Water Treatment PlantA municipal water utility must expand treatment capacity to meet growing demand and comply with stricter EPA water quality standards.Cost Estimate with ContingencyHow much contingency does the warehouse budget need?Risk Register: Threats and OpportunitiesHow much risk contingency does the hospital extension need?Schedule Risk on a Project NetworkWhen will the new bridge open?Integrated Cost and Schedule RiskBudget and completion date together: how confident can the sponsor be of both, for the treatment works upgrade?Rework and Change OrdersIs a 5% change allowance enough?Material Price Escalation and Procurement StrategyBuy the steel now, as needed, or with a price cap?Construction Cash Flow and Peak FundingIs a US$40 million facility enough?Webinar · free
One hour, live and online: build and run a simulation in Excel, read the results and find the inputs that matter most. Held about once a month.
See the next dateTraining
Risk analysis modelling courses can focus on your industry and on the problems you model, online or face-to-face.
See the coursesFAQ
Enough to reach the confidence level your board chooses, read from the simulated cost range rather than set as a flat percentage. In the free warehouse example the base estimate has a 12.5% chance of being enough, and a P80 budget needs $1.8M of contingency, 4.9% of the base estimate.
Yes. Tamara reads schedules from Primavera P6, Microsoft Project and Microsoft Planner Premium, adds the duration uncertainty and the risk events, and shows the range of finish dates and the activities that drive them.
No. ModelRisk is an Excel add-in. You put ranges and risk events into the workbook you already have and run the simulation from the ribbon.
Yes. ModelRisk, ModelChoice and Tamara each have a free 15-day trial, and our team can go through one of your own estimates or schedules with you.
Free 15-day trials of ModelRisk, ModelChoice and Tamara. For Pelican, we'll show it to you on risks like yours.
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