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Decision and Learning

A reasonable budget of the project should be about 122,000 dollars, which was more than the initially planned project budget. Two scenarios to successfully complete the project were considered: 1) improve development productivity by reducing potential risk factors, and 2) negotiate a higher project budget with the customer.

A transparent causal model (Figure 1) and sensitivity analysis results allowed project managers to identify which factors are likely to have the biggest impact on cost.

Identifying cost drivers with the largest impact on project costs

Negotiate higher project budget with customer
Short- and Long-Term Improvement
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