The Quantitative Risk Analysis and Modelling Techniques are used to help identify which risks have the most influence on the project and organization. It does this by assigned a projected value to the risks that have been ranked already by the previous process such as the Perform Qualitative Risk Analysis.
There are five inputs to perform this particular project management tool and these include the risk register, risk management plan, schedule management plan, cost management plan, and risk register updates. These inputs are necessary to create the quantitative risk analysis to determine the level or degree on how a particular risk can affect a particular process, product or service.
On the other hand, there are also Quantitative Risk Analysis and Modelling Techniques used by project managers to determine the level of influence of the risks identified. These techniques include the probability distribution, data gathering and representation techniques, sensitivity analysis, expected monetary value analysis, decision tree analysis, tornado diagrams and expert judgment.
Moreover, it also uses modeling and simulation which is an important technique in quantitative risk analysis. A good simulation technique used by project managers is the Monte Carlo analysis which is calculated using the computer and analyzing different scenarios for the project schedule to identify possible risk events.
This term is defined in the 5th edition of the PMBOK.