Practical Project Risk Handbook for Project Managers: A Guide to Enhance Opportunities And Manage Risks on Large, Complex Projects by Jeremie Averous

Author:Jeremie Averous [Averous, Jeremie]
Language: eng
Format: azw3
Publisher: Fourth Revolution Publishing
Published: 2015-02-05T05:00:00+00:00

Checking for model convergence

Before delving into the details of the method, it is important when running a Monte Carlo model to check that the model has effectively converged before interpreting the results.

In the case of Project contingency models, it is not rare to require up to 10,000 iterations to have a converging Monte-Carlo model. This remains a quick calculation on modern computers. Still too often we observe that conclusions are being drawn from results that have not been checked for model convergence. When trying to reproduce the results, different values are then obtained which is very confusing.

Effective convergence can be ascertained by running the model several times with the same number of iterations and checking that the results are consistent within a small range. If they are not, then the number of iterations should be increased until consistency and reproducibility of results are obtained.

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