Creating a Sensitivity Analysis Based on Different Task Durations in ALICE
Challenge:
No matter how task durations are derived in the schedule, the underlying assumption in any schedule is that there is one duration per activity.
However, it is very likely that there is a possible range of durations for each activity based on different factors, such as:
- Faster or slower planned productivity
- Fixed durations from historical database did not account for specific site conditions
- Calculated durations based on quantities did not have accurate quantities available
Therefore, how do we understand the impact of the schedule based on variability of different task durations? How sensitive is a change to a task duration to the rest of the schedule?
Solution:
In this article, you will learn how to create a duration sensitivity analysis for critical activities based on a range of different possible durations. This can be achieved by applying a Coefficient Factor to the duration formula. The end result is a sensitivity analysis showcasing the impact of various changes to the durations of activities. The below table and graph is an example of a task duration sensitivity analysis that can be generated from running scenarios in ALICE:
| Duration of Activity A | Overall Project Duration | # of Tasks on the Critical Path | Total Cost |
| -15% = 8.5 days | 45 days | 13 | $1.1MM |
| -10% = 9 days | 45 days | 10 | $1MM |
| -5% = 9.5 days | 46 days | 11 | $1.2MM |
| Baseline = 10 days | 50 days | 12 | $1MM |
| +5% = 10.5 days | 60 days | 12 | $1.3MM |
| +10% = 11 days | 60 days | 12 | $1.3MM |
| +15% = 11.5 days | 60 days | 15 | $1.4MM |
In this example, the duration of critical activity A is very sensitive if it takes longer than planned. By only increasing the duration by +5%, the overall project duration increased from 50 to 60 days (20% increase!).
How to Impact the Bottom Line:
- Intentionally add and remove contingency to specific activities based on data-driven information
- Manage execution risk by understanding which activities to focus your attention on (e.g. Activity A is very sensitive to duration change so we should provide extra oversight here). This will help protect your margins.
How ALICE is Different from Other Tools:
When applying a duration change in other tools, no sequence adjustments (or activity reshuffling) occurs. Activity durations are simply changed; all logic ties and resource utilization remain the same.
In ALICE, new optimal schedule options are provided based on possible resequencing of activities and reshuffling of project resources with a change to any activity duration (or multiple activity durations).
Example Use Cases:
- As a Commercial Contractor, there are hundreds of unique complex shaped columns that need to be installed throughout the project. Based on the senior planner’s experience, a fixed duration is applied to this critical activity. However, since this installation has never been done before, the project team needs to understand what is the impact of the overall schedule if this duration is faster or slower by +/- 25%, in increments of +/- 5%. The team would like to showcase a sensitivity analysis to the project stakeholders to help them understand how this unique installation impacts the overall project.
How to Determine How Sensitive a Task Duration is in ALICE:
It is not necessary to start with a schedule that is resource loaded. Read more here about the different levels of resource assignments.
Sensitivity analysis can be done on a single task or on a combination of different tasks (e.g. sensitivity of Task A or sensitivity of Tasks A+B+C+D). To conduct this exercise, we are going to add a Coefficient Factor to the duration of the task(s).
Step 1:
Select the activity or group of activities where you want to understand the sensitivity of its duration.
Step 2:
Create a new production rate. This will be the Coefficient Factor.
Step 3:
Update the duration of the activity or group of activities to make it parametric. The new formula is:
New Duration = Old Duration x Coefficient Factor
New Duration = Old Duration x (1+(Percent Change/100))
New Duration = Old Duration + (Old Duration x Percent Change / 100)
Step 4:
Go to the Explore page, create a new scenario, and go to the “Rates” tab. Input the Coefficient Factor for the amount of change in duration that you want to evaluate. For example, if -5% is used, then the activity duration that is evaluated for a 10-day original duration task is:
10 days + (10 days x (-5/100)) = 9.5 days
Please note that we use the “Production Rate” feature in ALICE to generate the Coefficient Factor. Its functionality behaves like a production rate, but in this use case, we are not using it as a production rate.
Step 5:
Repeat Step 4 and change the Coefficient Factor number based on the amount of change in duration that you want to evaluate. For example, 6 scenarios need to be run to evaluate the impact of -15%, -10%, -5%, +5%, +10%, and +15% on an activity or group of activities.
Step 6:
Document the results and generate a report. The table and graph format are recommended (as shown in the example above).