Using Bayesian Monte Carlo (BMC) to Simulate Program Risks/Opportunities, Prioritize Mitigation in a Complex Program, and Maximize ROI
Nathan Eskue, Manager, Program Material Control, Orbital ATK
January 17, 2018
Wouldn’t it be nice if you could tell a robot all the things you’re worried about—and even nicer if they could respond back with a list of the most important things to do first in order to make your life better? Wouldn’t it be fantastic if they were statistically accurate every time?
The BMC Program Simulator works exactly like that. It was built so that you can focus on what is most important to the success of a program—managing your risks. By identifying R&O’s and estimating mitigation costs, a program manager can use the simulator (an Excel-based data model) to simulate a “multiverse”–every possible combination of program events that might happen. It then simulates every possible mitigation action and provides statistically sound—using Bayesian Monte Carlo Analysis and Variable Uncertainly Parameters—recommendations that prioritize what actions to take in order to minimize your mitigation costs while maximizing risk prevention. This session will review the high level mechanics of the simulation, then show how the data model has expanded from an EAC forecasting role (R&O simulation) to an advisor role (prioritized action list for ROI maximization). I will provide the model for participants to take, use, and provide feedback for continuous improvement.
Expected Key Takeaways for Participants:
- Gain an easy to understand overview of Bayesian Monte Carlo Analysis and Variable Uncertainly Parameters—even if they are completely new to the topic
- Understand how BMC compares to current R&O management techniques, and why it is both simpler AND better
- Understand how the BMC Program Simulator works and how a program manager would use it in a real world scenario
- Understand how to read the tool outputs and recommendations given, and understand why they are always statistically accurate
- Get a copy of the tool to use! The only thing I ask for in return is feedback on how to further improve the tool or process.
I got my start in project management at the age of eight when I picked up my first Dilbert book. I learned about paradigms and pointy haired bosses—and was hooked. That path, combined with a fascination for how things work, have led me to the world where business meets engineering. I have a B.S. from the University of Arizona, majoring in Management Information Systems, Operations Management, and Marketing. I have a Masters of Engineering from Columbia University, and an MBA from the University of Arizona. Since that point I’ve been on a journey filled with really amazing projects led by really smart people. I’ve worked at NASA helping to manage a Cubesat project, worked at Raytheon as part of the Missile Defense Program, and have been part of Orbital ATK for 8 years. I’m currently the manager of the Program Material Control group, where we live and breathe Earned Value, EAC analysis, and risk management. My other passion is teaching, and I’ve been a professor for six years at a local university whose niche focus is robotics, network security, and advanced programming. My courses specialize in business, robotics, project management, strategic thinking, and entrepreneurship.
PDU = 1