Tornado Diagram (Chart)

Tornado diagrams (charts) can be helpful when evaluating risk in a project, as it provides an overall view of the different components that can cause variation and uncertainty in the outcome.

In this article, we will discuss what exactly tornado diagrams are and how they are used in projects. The diagram is useful for sensitivity analysis by evaluating the relative significance of variables. It is so named by experts because the final chart appears like one-half of a full tornado or full tornado.

What is a Tornado Chart?

Tornado diagrams represent a sensitivity display of quantitative risk analysis models that presents not only which risk factors have an effect on the project, but also the magnitude of the effect. It provides a useful tool for deciding how to control risks. 

The tornado diagram, a representation of different risks associated with a project, helps us identify risks that have no effect on the project's objective. Additionally, countermeasures and contingency plans can be created to address risks correlated with those factors by identifying what parts of our projects to focus on and mitigating these risks by adding pertinent action plans. 

To be effective, a tornado diagram should list all potential factors for project failure. If any item that could impact the project's chances of success is left off your list, you'll have missed an opportunity to better your odds of success.

Tornado Diagrams are generally used for sensitivity analysis in the following performance domains;

The shape of the tornado diagram usually produces an identifiable pattern, making it possible for you to quickly identify bright spots or risk management priorities that should be considered in order to attain better outcomes than anticipated. 

If you want to create a tornado diagram:

  • Define and assign values to your risk variables. 
  • Decide whether the values are correlated with each other and pick one from each correlated pair or set. From these, calculate the corresponding y-axis values. 
  • Plot your points by entering these y-axis values and completing the visualization process with dedicated risk software. 
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