Guide: Risk Analysis
This guide walks you through assigning risk levels to tasks, running a Monte Carlo simulation, and interpreting the results to make better planning decisions.
Prerequisites
- A project with tasks defined and dependencies set
- See Create a Project for setup
Step 1: Assign Risk Levels to Tasks
Risk levels tell the simulation engine how much uncertainty to apply to each task’s duration.
For each task in your project:
- Open the task (click on the task bar on the Gantt chart or select it from the task list)
- Set the Risk Level field:
- Low — you are highly confident in the estimate; minimal variance
- Medium — there is moderate uncertainty; the task could run over by a reasonable margin
- High — the estimate is rough; the actual duration could differ significantly
- Save the change
Assign risk levels honestly. The simulation is only as useful as the risk assumptions you put in.
As a starting point:
- Tasks with strong precedent (done this before, clear scope) → Low
- Tasks with some unknowns or external dependencies → Medium
- Exploratory work, novel integrations, waiting on unclear external inputs → High
Step 2: Run the Monte Carlo Simulation
From the project view, locate the Monte Carlo or Risk Analysis panel.
Click Run Simulation. Lineo-PM will queue the simulation job and process it in the background via the Celery worker.
The simulation typically completes within a few seconds. The results panel will update automatically when the job finishes.
Step 3: Interpret the Results Dashboard
Slip Probability
The headline number: the percentage of simulated runs in which the project finishes after the target end date.
- < 20% — low delivery risk
- 20–50% — moderate risk; consider mitigation
- > 50% — the plan is more likely to slip than not; action is needed
Percentile Delays
How much delay to expect at different confidence levels:
| Metric | Meaning |
|---|---|
| P50 (Typical Delay) | Delay in the median simulation run |
| P75 | Delay in the 75th percentile run |
| P85 | Delay in the 85th percentile run |
| P95 | Delay in the 95th percentile — the “conservative” estimate |
If you need high confidence in on-time delivery, plan to the P85 or P95 date.
Per-Task Slip Risk
Each task has its own slip probability — how often it finished late across all simulation runs. Tasks with high per-task risk are candidates for:
- Scope reduction
- Additional resources
- Earlier start dates
- Breaking into smaller, more estimable chunks
Critical Index
How often each task appeared on the critical path across all simulation runs (expressed as a percentage). A task with a critical index of 80% is on the critical path in 80 out of 100 simulated projects.
Focus risk mitigation efforts on tasks with both high risk level and high critical index — these have the most leverage on overall delivery.
Delay Distribution
A histogram of simulated project end dates. Use this to communicate the range of outcomes to stakeholders — from the optimistic tail to the pessimistic tail.
Step 4: Act on the Results
After reviewing the results, consider:
- Reducing risk on high-impact tasks (tighter scope, more experienced resource, earlier prototyping)
- Adjusting the baseline schedule to add buffer on high-critical-index chains
- Building a risk-adjusted scenario with more conservative estimates (see Risk-Adjusted Scenarios)
- Communicating the range of possible end dates to stakeholders rather than a single date