- Spreadsheets: – Powerful for many types of calculations including payoff matrices, calculation of expected value and expected monetary value. It is easy to develop templates for small-to-medium sized decision trees. Can also be used to model and graph sensitivity analysis. Microsoft Excel provides various add-ins that can accommodate many of the stochastic tools. Examples are precision tools (for decision trees) and simulation ready (Monte Carlo simulation).
- Monte Carlo Simulation: – For spreadsheets, there are two vendor choices available:Crystal Ball by Decisioneering Corporation (http://www.decisioneering.com): – Includes optimisation programs and information and is based on neural networks and heuristics.
- @RISK by Palisade Corporation (http://www.palisade.com): – Widely known tool that can be used as an add-in for all leading spreadsheet packages (i.e. Lotus 1-2-3, Microsoft Project, etc.)
- Risk + by C/S Solutions Inc. (http://www.cs-solutions.com): – Tool for purely adding simulations to Microsoft Project.
- Decision Tree Analysis: – The following is a list of add-in Microsoft Excel tools that allow decision trees to be built within the spreadsheet: –
- PrecisionTree by Palisade Corporation (http://www.palisade.com): – Widely known tool that builds trees inside the spreadsheet with all the required formulas included. Combination of Precision Trees and @RISK are designed to work together which is particularly valuable for people that require to do decision trees and simulation as part of the one experiment / process.
- DATA by TreeAge Software Inc. (http://www.treeage.com): – Complex tool, which is very similar to PrecisionTree, but is not ideal for simple problems.
- DPL (Decision Process Language) by Applied Decision Analysis Inc. (http://www.adainc.com): – Another tool which is self-sufficient in the build and application of decision trees.
All of the decision tree programs, which have been mentioned, are able to develop the decision model as an influence diagram and then convert these to a decision tree. Modifying the decision tree will allow modification of the influence diagram with DPL only. Remember that value trees and decision trees use the same methodology and the difference is the units of measure (i.e. utility and money).
- Project Risk Management: – Most project managers have a standard method for the management of risk, whether this is register created with spreadsheets and / or the use of some of the tools, which have been mentioned in this section (i.e. Monte Carlo simulation or Decision Trees). However some software packages exist that cater for the management of risk:
- PROAct by Engineering Management Service Inc. (http://www.maxvalue.com/pa.htm): – The combination of Visual Basic and spreadsheets that provide automated risk management tracking software. The tool mentioned is primarily a database for capturing and maintaining an inventory of risks and actions with graphical representations of distributions. PROAct incorporates the tools and techniques described in the previous points and balance the information against the constraints of the project (i.e. time, cost and quality).
These are a sample of the software packages that are on offer. The use of any one tool will achieve one particular objective; however it is the use and combination of these tools that gives the best result. This is something that the software package PROAct has performed with success.