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Sustainability 2018, 10(5), 1609; https://doi.org/10.3390/su10051609

Project Portfolio Risk Identification and Analysis, Considering Project Risk Interactions and Using Bayesian Networks

1
Project and Construction Management, Faculty of Architecture and Urban Planning, University of Art, Tehran 1136813518, Iran
2
Construction and Project Management, University of Tehran, Tehran 1417614418, Iran
3
Civil Engineering Faculty, Vilnius Gediminas Technical University, Saulėtekio al. 11, LT 2040 Vilnius, Lithuania
*
Author to whom correspondence should be addressed.
Received: 18 April 2018 / Revised: 5 May 2018 / Accepted: 9 May 2018 / Published: 17 May 2018
(This article belongs to the Special Issue Sustainability in Construction Engineering)
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Abstract

An organization’s strategic objectives are accomplished through portfolios. However, the materialization of portfolio risks may affect a portfolio’s sustainable success and the achievement of those objectives. Moreover, project interdependencies and cause–effect relationships between risks create complexity for portfolio risk analysis. This paper presents a model using Bayesian network (BN) methodology for modeling and analyzing portfolio risks. To develop this model, first, portfolio-level risks and risks caused by project interdependencies are identified. Then, based on their cause–effect relationships all portfolio risks are organized in a BN. Conditional probability distributions for this network are specified and the Bayesian networks method is used to estimate the probability of portfolio risk. This model was applied to a portfolio of a construction company located in Iran and proved effective in analyzing portfolio risk probability. Furthermore, the model provided valuable information for selecting a portfolio’s projects and making strategic decisions. View Full-Text
Keywords: project portfolio risk; risk interactions; risk analysis; risk identification; Bayesian networks project portfolio risk; risk interactions; risk analysis; risk identification; Bayesian networks
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This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited (CC BY 4.0).
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Ghasemi, F.; Sari, M.H.M.; Yousefi, V.; Falsafi, R.; Tamošaitienė, J. Project Portfolio Risk Identification and Analysis, Considering Project Risk Interactions and Using Bayesian Networks. Sustainability 2018, 10, 1609.

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