Please use this identifier to cite or link to this item: https://dair.nps.edu/handle/123456789/2840
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dc.contributor.authorEdouard Kujawski
dc.contributor.authorDiana Angelis
dc.date.accessioned2020-03-16T18:20:51Z-
dc.date.available2020-03-16T18:20:51Z-
dc.date.issued2008-09-01
dc.identifier.citationPublished--Unlimited Distribution
dc.identifier.urihttps://dair.nps.edu/handle/123456789/2840-
dc.descriptionFinancial Management / NPS Faculty Research
dc.description.abstractNaval vessels, like most large-capital projects/programs, have a long history of cost growth and overruns. To get a handle on this problem, NAVSEA's Cost Engineering and Industrial Division, NAVSEA 05C, has introduced Probabilistic Cost Risk Analysis (PCRA) into the Department of Defense (DoD) Planning, Programmatic, Budgeting, and Execution System (PPBES). The quantification of cost in terms of Cumulative probability Distribution Functions (CDF) or S-curves provides a macroscopic view of project/program risk. Risk curves alone do not provide adequate visibility into the individual project risk drivers; therefore, they are insufficient for planning and managing Risk Reduction Activities (RRA). Complex projects typically involve a set of high-consequence, project-specific risks that require detailed analysis and for which risk response actions need to be developed and implemented. The analysis of specific risks and RRAs requires a microscopic view. We present a practical and mathematically sound approach using scenarios and Monte Carlo simulation within the framework of decision trees and risk curves. The approach is detailed using a realistic but simplified case of a project with three technical risks.
dc.description.sponsorshipAcquisition Research Program
dc.languageEnglish (United States)
dc.publisherAcquisition Research Program
dc.relation.ispartofseriesCosting
dc.relation.ispartofseriesNPS-FM-08-123
dc.subjectProbabilistic Cost Risk Analysis (PCRA)
dc.subjectPlanning
dc.subjectProgrammatic
dc.subjectBudgeting
dc.subjectand Execution System (PPBES)
dc.subjectCumulative Probability Distribution Functions (CDF)
dc.subjectRisk Reduction Activities (RRA)
dc.subjectMonte Carlo Simulation
dc.titleDynamic Cost Risk Assessment for Controlling the Cost of Naval Vessels
dc.typeTechnical Report
Appears in Collections:Sponsored Acquisition Research & Technical Reports

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