What is Monte Carlo Simulation?

The Monte Carlo Simulation in project management is analogous to playing out multiple scenarios for your project on a computer, just like a weather prediction predicts different outcomes. It’s a strategy in which a computer runs millions of alternative scenarios depending on the uncertainties in your project, such as varied weather conditions impacting a trip. Instead of providing a single forecast, it presents a range of probable outcomes, taking into account the different elements that might affect your project’s time, cost, or other variables. It’s a means to see the possibility of many outcomes, which helps project managers understand the risks and make better decisions by planning for a variety of probable outcomes rather than depending on a single projection.