Decision Tree: Risk & Opportunities

Abstract

Uncertainty is a massive issue in project management and can lead to high cost and disadvantages if not handled correctly. The project manager must therefore be able to make the best decisions based on the information available.
The decision tree is a tool that can air the project manager to ensure the best outcome of a problem. It is highly used within project management to ensure the lowest risk of expenses. It is based on a tree-like model where each branch is a path of decisions and possible events. Each step include the cost and possibility of that event to occur. When having all the possibilities and cost of each path the estimated risk and cost/benefit can be calculated. With all the information available it is now the project managers task to estimate the best possible path.