What-If Scenario Analysis is the process of evaluating scenarios in order to predict their effect on project objectives.
It examines possible outcomes under different sets of assumptions, constraints, or conditions to support proactive decision-making. This analysis helps project teams identify risks, assess trade-offs, and prepare contingency or response strategies based on forecasted impacts.
Key Characteristics
- Predictive Tool – Explores the consequences of hypothetical events or choices
- Decision-Focused – Informs responses to potential project deviations
- Scenario-Based – Models multiple alternative paths or inputs
- Supports Risk and Schedule Management – Often used to test impact of delays or scope changes
Example Scenarios
- Assessing how a two-week delay in material delivery would impact the finish date
- Comparing cost impact of adding an extra team versus extending the timeline
- Evaluating risk exposure if a critical supplier fails
Example What-if Scenario: Decision Tree
flowchart TD A[Start: Current Project Plan] A --> B1[Scenario 1: Team Reduced] A --> B2[Scenario 2: Delivery Delayed] A --> B3[Scenario 3: Budget Increased] B1 --> C1[Impact: +3 weeks, -$10K risk buffer] B2 --> C2[Impact: +2 weeks, re-sequence tasks] B3 --> C3[Impact: +1 team, on-time, +$30K cost] C1 --> D1[Mitigation: Extend timeline] C2 --> D2[Mitigation: Fast-track schedule] C3 --> D3[Mitigation: Add new workstream]
Role in Forecasting and Risk Planning
- Improves Preparedness – Equips the team with options for high-impact risks
- Enhances Decision Quality – Supports informed choices based on potential impact
- Strengthens Contingency Planning – Tests whether current buffers or reserves are sufficient
- Feeds into Monte Carlo or Schedule Simulations – Often used with quantitative analysis tools
See also: Quantitative Risk Analysis, Contingency Plan, Monte Carlo Simulation, Schedule Model Analysis, Risk Response Planning.