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Project Management Using Event Chain Methodology

written by: Suba Lakshminarasimhan • edited by: Jean Scheid • updated: 10/15/2011

There are large number of risks or event chains and project activities create an impact in the different project phases. Project management using event chain methodology is the uncertainty modeling approach practiced by project managers today to identify and eradicate such events.

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    Event Chain Methodology Objectives

    Uncertain situations occur at any phase of the entire project lifecycle, and in turn, lead to project mishaps. At times, project managers ignore the risk if it is outside of the project scope. The key objective of this methodology is to identify the event chain that affects the project outcomes.

    By identifying these event chains, project managers gain as follows:

    • Simplify schedule network analysis models
    • Ameliorate accurate project planning and meet deadlines appropriately
    • Diminish the impact of known or unknown project planning prejudices
    • Create an error-free project schedule by providing flexible layouts
    • Increase the ability of the project managers to visualize the chain of events that are disturbing the project outcomes
    • Give way to lot of quantitative analysis models that are very accurate to identify the potential events that are affecting projects

    In essence, event chain methodology helps project managers identify and avoid project delays, revenue losses and overall project failures.

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    Event Chain Methodology Principles

    There are six principles practiced in project management using event chain methodology. Below you'll learn more on event chain methodology principles along with in depth information about each one of the principles.

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    1. Event State Tables and Chain Diagrams

    In the case of complex chain of events, Gantt charts are used to simplify the events and identify solutions. Event chain diagrams and state tables are the visualization models used to clarify the relationship between the chain of events. The impact of these event chains in the project activities is also measured while using this methodology. Such diagrams are used to simplify the risk analysis methods and find out the uncertainties in advance.

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    2. Ground States and Excited States

    Be it a real project or a virtual project, the procedures in projects are not always designed in an uniformed manner or as a continuous process. Both the external or the internal events change these processes from one state to another. The ground state is nothing but the original state or how the activity was initially planned. The event chain methodology defines the changed state as an excited state. These event chains sometimes create certain significant changes in project activities which can lead to project closure or failures.

    Chain of Events, guitargoa, sxc.hu 

    To avoid such scenarios, the event chain methodology is used to analyze the project activities and identify the risks. Monte Carlo simulation or statistical distribution are the widely used methods in event chain methodology to identify such event chains.

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    3. Chain of Events

    Occasionally, a ripple effect is created when one event leads to a chain of events and in turn, develops positivity or negativity in the project objectives. Please see the below example to understand how the chain of events create an impact on the project deliverables:

    • A key member X in project activity A goes on medical leave suddenly for an indefinite period
    • Project manager pulls another key resource Y from project activity B to handle the responsibilities of X
    • Resource Y is put in a situation to handle many different responsibilities at the same time
    • Resource Y has to hand over or train a new resource to take care of Y’s role in project activity B and learn the activities X was already performing in project activity A.

    What is an impact from the above situation created on the project outcome?

    • Resource Y struggles and loses motivation which can spread among the team
    • Delay in both the project activities A and B subsequently affect the interrelated or interconnected activities in both the activities
    • Project failure or closure due to inability of completing project activities on time

    How can an Event Chain Methodology help in such a Situation?

    • As a first step, the new human resource requirement in project activity A changes the ground state to an excited state. The sourcing completed state changes to resource required state.
    • As a second step, a new resource is replaced in project activity A from project activity B. This process changes the ground state of project activity B to an excited state as resource required. If the state is not changed, appropriate resource utilization for project B may not occur.
    • If project activity B proceeds with less number of resources, the excited state is further changed to the extended lead time to complete project activity B
    • Once the responsibility of resource Y in project activity A is stabilized, he / she will be able to either train a new resource or manage both A and B activities. The extended period in project activity B will not delay the overall project.

    According to Project Management Institute (PMI), there are four strategies such as risk acceptance, risk mitigation, risk transfer and risk avoidance are greatly used in the chain of event principle.

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    4. Event Chains Related to Duration and Cost

    The uncertainties related to duration and cost are common in real time and virtual projects. These uncertainties cause major problems in projects and can lead to project failures. The Monte Carlo simulation is used to identify such fluctuations in the projects. The events are identified and the moments are calculated by using certain statistical distribution methods.

    Duration, kodakgold, sxc.hu 

    The quantitative analysis through the Monte Carlo method is used to calculate the cumulative consequences of the events. The results normally include the statistical distributions of the event chains or a single event. The single event can be the project duration, costs or, the success of each project activity.

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    5. Critical Event Chains

    At times, there is a single event or a chain of events that causes major project issues. Such crucial events or the event chains are known as the critical event chains. To avoid the occurrence of certain issues in projects, it is important for the project managers to identify these critical event chains and mitigate them.

    The sensitivity analysis is used widely in event chain methodology to find out these critical event chains. This method helps to identify the events, variations, responses and project activity changes that occur under different conditions. Remember, even a single critical event can create an impact on multiple project activities.

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    6. Performance Measurement Related to Event and Event Chains

    There are different performance measurement system models used in projects. Normally, the historical data is used to measure the performance of any project. By using historical data, project managers decide whether any particular event or the event chain can have an impact on the project outcomes or not. However, it is not easy to understand which historical data is appropriate to identify such events.

    Remember, projects differ from each other and variations are more than common in the project activities. In such cases, the event chain methodology using the Bayesian belief network analysis method helps a lot. Additionally, project managers also use events that occur based on the actual project performance.

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    Event Chain Methodology Facts

    Project management using event chain methodology is a great model to identify an event or the event chains that are affecting projects. Occasionally, these methodologies also create interesting situations. The closed or completed activity in a project gets started again or the new activities that are not planned originally get triggered suddenly. However, a very well developed mathematical model in event chain methodology helps project managers to get rid of events causing issues in the projects.

References

  • Project Management Using Event Chain Methodology referred at http://www.project-management-opinions.com/index.php/directory/Methodologies/Event-Chain-Methodology/details
  • Bayesian Belief Network referred at http://www.eecs.qmul.ac.uk/~norman/BBNs/BBNs.htm

    Image Credits:

    Chain of Events, guitargoa, sxc.hu

    Duration, kodakgold, sxc.hu