Decision Support System(DSS)

-DECISION TOOLS

What is Decision Tools Suite?

• An integrated set of programs for risk analysis and decision making under uncertainty - runs in Microsoft Excel.

• The Decision Tools Suite is used to analyze risk and uncertainty in a wide variety of industries.

• From the financial to the scientific, anyone who faces uncertainty in their quantitative analyses can benefit from The Decision Tools Suite.

The Decision Tools Suite includes

• @RISK - Monte Carlo simulation • Precision Tree-decision trees• Top Rank -“what if” sensitivity analysis • Stat Tools -statistical analysis and

forecasting• Neural Tools - predictive neural networks • Evolver and RISK Optimizer -optimization.

FEATURES• Map out decisions with decision trees and influence diagrams

• Works in Excel 

• Sensitivity or What-If Analysis

• Distribution viewing and fitting 

• Full integration between programs

• Linear Programming solving methods

• Parallel processing 

• Bundle pricing 

BENEFITS• Identify and illustrate the best alternative

• No need to learn new applications 

• Accurate description of uncertainty

• Easily explain results and recommendations to others 

• Solve linear problems – both large and small – quickly and accurately

• Save money compared to buying products separately

Industries & ApplicationsINDUSTRY

• Finance And Securities

• Insurance / Reinsurance

• Manufacturing

• Government And Defense

• Environment

SAMPLE APPLICATION• Retirement planning, Discounted

Cash Flow analysis,

• Loss reserves estimationPremium pricing

• Six Sigma and quality analysis ,Plant shutdown ,Product life cycle analysis

• Resource allocationWelfare and budgetary projections

• Endangered species preservationPollution cleanup and projections

How @RISK Works?!• Start by replacing uncertain values in your

spreadsheet with @RISK probability distribution functions, like Normal, Uniform, or over 35 others.

• These @RISK functions simply represent a range of different possible values that a cell could take instead of limiting it to just one case.

• Choose your distribution from a graphical gallery, or define distributions using historical data for a given input.

HOW CAN YOU USE IT-• Set Up Your Model– Define Uncertainty with Ease – Share Your Model with Others

(Share specific distribution functions with others using the @RISK Library, or swap out @RISK functions for colleagues who don’t have @RISK.)

• Run the Simulation. • Understand Your Risks

FEATURES• 100% Excel calculations for simulation

• Seamless integration into Microsoft Excel

• Intuitive toolbars and right-click menus

• Over 40 built-in distribution functions

• Integration with Microsoft Project

• Simulation of Time-series forecasts 

• Multi-CPU Support 

• One-click Quick Reports

BENEFITS• Highest level of accuracy, and maximum 

use of multi-core processors for speed

• Easy navigation—multiple ways to reform common tasks

• Represent virtually any uncertain factor for accurate modeling

• Understand the risks in values that change over time

• Split up” large simulations to run on multiple CPUs or cores and reduce simulation run time

• See summary of charts and graphspre-formatted for one page

Industries & ApplicationsSAMPLE APPLICATION

• Retirement planning, Discounted Cash Flow analysis,

• Loss reserves estimationPremium pricing

• Six Sigma and quality analysis ,New product analysis,  Plant shutdown ,

• Resource allocationWar gamesWelfare and budgetary projections

• Endangered species preservationPollution cleanup and projections

INDUSTRY• Finance And Securities

• Insurance / Reinsurance

• Manufacturing

• Government And Defense

• Environment

What is Precision Tree?• Precision-tree helps you tackle these types of

complex, sequential decisions.

•   Visually map out, organize, and analyze  decisions using decision trees.– Decision trees are quantitative diagrams with

nodes and branches representing different possible decision paths and chance events.

• This helps you identify and calculate the value of all possible alternatives, so you can choose the best option with confidence.

How PrecisionTree Works?Build a Decision Tree:• a formal structure in which decisions and

chance events are linked in sequence from left to right.

• Decisions, chance events, and end results are represented by nodes and connected by branches.

Analyze Your Results• Precision-Tree determines the best decision to

make at each decision node and marks the branch for that decision TRUE.

• Once your decision tree is complete, Precision Tree’s decision analysis creates a full statistics report on the best decision to make and its comparison with alternative decisions.

• It displays probability and cumulative charts showing the probabilities of different outcomes and of an outcome less than or equal to a certain value.

FEATURES

• Decision trees

• Risk profile reports

• Policy Suggestion Report

• Logic nodes

• Utility functions

APPLICATIONS:SAMPLE APPLICATION

• War And Engagement Modeling

• Earthquake And Disaster PlanningStructural Planning And Integration

• Resource ManagementPreservation Programs

• Portfolio SelectionReal Options Analysis

INDUSTRY• Defense

• Engineering 

• Environment    

• Finance and securities  

TOP- RANKS• Define any output or “bottom line” cell or cells,

and Top Rank will automatically find and vary all input cells which affect your output.

• You can also control exactly which cells you’d like to analyze.

• The end result is easy-to-understand tornado charts, spider graphs, and other reports which clearly identify and rank which affect your bottom line the most.

How Top Rank Works?!• Take existing spreadsheet model- select any cell

or cells as outputs-Top Rank scans the spreadsheet to find cells which affect your results.

• Top Rank windows point to the cells they refer to via callouts, and changes in one place are automatically carried out in the other.

• Click the ‘Run What-if’ button and Top Rank tries different values for each variable cell, changing values over ranges such as -10% and +10%.

• Each time a new value is tried, the spreadsheet is recalculated and new results are generated. 

• Upon completion, TopRank ranks the variable cells according to the effect they have on your selected outputs.

• You can also select exactly which cells you wish to vary, and by how much, for a more customized analysis

FEATURES• Automated what-if analysis 

• Seamless integration into Microsoft Excel

• Automatic identification of inputs

• Browse through inputs with Tab key

• Multi-Way What-If Analysis

BENEFITS

• Quickly focus your analysis

• Saves time

• Easily identify inputs and illustrate to others

• Identify scenarios of multiple inputsaffecting results

Neural Tools

• NeuralTools gives Microsoft Excel - the industry-standard data analysis and modeling tool

The problems Neural Networks are used

• Classification Problems: Problems in which you are trying to determine what type of category an unknown item falls into. Examples include medical diagnoses and prediction of credit repayment ability.

• Numeric Problems: Situations where you need to predict a specific numeric outcome. Examples include stock price forecasting and predicting the level of sales during a future time period.

Difference in professional and

industrial:• Datasets in NeuralTools Professional are limited to 1000 cases, while NeuralTools Industrial supports datasets with up to 16,777,216 cases. 

• Live Prediction, where predicted values are calculated as new data is entered into your Excel worksheet, is provided in NeuralTools Industrial only. This live calculation happens automatically, just like other Excel recalculations.

Its features and working• Neural tools-reporting-

– usage of excel features to edit, format are used.– Live prediction

• Data sharing is easier-saves as excel file– Use standard Excel capabilities to read in data

from Microsoft SQL Server, Oracle, Microsoft Access, or any other ODBC compliant database. Load data from text files or other applications – if you can read it into Excel, you can use it with NeuralTools!

NeuralTools Data Management• Define any number of datasets, each with the variables you want to

analyze, directly from your data in excel.

• NeuralTools intelligently assesses your blocks of data, suggesting variable names and types as well as data locations.

• Your datasets and variables can reside in different workbooks and worksheets, allowing you to organize your data as you see fit.

• Then, you train neural networks that refer to your variables, instead of re- selecting your data over and over again in excel.

• Neuraltools' variables aren't limited in size to a single column of data in an excel worksheet – you can use the same column across up to 255 worksheets for a single variable!

STAT- TOOLS

Features Of Stat Tools• New statistics in Excel

 • Live updating when input data changes

• Intelligent data management

• Capacity for large data sets; support for Excel 2010 worksheet size

• Excel-based reporting and charting 

• Save results in Excel workbooks

Benefits Of Stat Tools• Replaces questionable Excel functions and perform wide

range of analyses.

• Statistical reports and charts always reflect latest data.

• Quick definition of data sets; management of multiple data sets.

• No limits on amount of data to analyze (Industrial only. 10,000 data points per variable for Professional).

• Full customization capabilities on all Stat Tools reports

• Share Stat Tools reports with any Excel user, even if they don’t have Stat Tools

Industrial and application of stat tools

Industry • Finance and securities

• Six sigma/ quality analysis

• Healthcare

• Manufacturing

Applications• Sales forecasting,

Retirement planning

• Manufacturing quality control,Customer service improvement 

• Improving quality of care,Research 

• Six Sigma and quality analysis,Product life cycle analysis,Demand forecasting

Evolver• Evolver uses innovative genetic algorithm (GA), Opt Quest, and

linear programming technology to quickly solve problems in finance, distribution, scheduling, resource allocation, manufacturing, budgeting, engineering, and more.

• Virtually any type of problem that can be modelled in Excel can be solved by Evolver, including otherwise unsolvable, complex nonlinear problems.

• Evolver has a unique ability arrive at the best overall “global” solution to a problem—solutions traditional solvers typically miss.

Features of evolver• Genetic algorithm optimization

• Opt Quest solving engine

• 100% Excel calculations

• INTERFACE:– Seamless integration into Microsoft Excel

– Streamlined interface

• MODEL DEFINITION:– Ranges for adjustable cells and constraints

– Six solving methods 

– Discrete adjustable cells

Benefits of Evolver• Find the best global solution to complex, 

real-life problems.

• It provides great results – and quickly – on many types of models.

• Highest level of computation accuracy

• Fewer nested dialogs and fast model setup

• Always have the best method for different types of problems

• Specify increments (such as batches of 10) within adjustable cells ranges, improving accuracy for many types of models.

• Also speeds up optimization.

Industry And Application Of Evolver

Industry

• AIRLINES and HOTELS

• MANUFACTURING   

• FINANCE

 

Application

• Yield management with uncertain demand

• Job shop, production, manpower schedulingInventory management Capacity planningProduct mix decisions.

• Portfolio maximizationHedging strategies Portfolio balancing Retirement planning.

RISK Optimizer•  Program optimization or software optimization - the

process of modifying a software system to make some aspect of it work more efficiently or use fewer resources.

•  It is done so that it executes more rapidly, or is capable of operating with less memory storage or other resources, or draw less power.

• Traditional optimization methods ignore this uncertainty, a very risky approach.

• Risk optimizer tells you not only the best combination of inputs to use, but the risk associated with each strategy.

• Seek out strategies which help to minimize your risks while achieving your goals.

• Combines the Monte Carlo simulation technology of @RISK, palisade’s risk analysis add-in- to allow the optimization of excel spreadsheet models that contain uncertain values

• Take any optimization problem and replace uncertain values with @RISK probability distribution functions that represent a range of possible values.

• For each trial solution risk optimizer tries during optimization, it runs a Monte Carlo simulation, finding the combination of adjustable cells that provides the best simulation results.

How RISK Optimizer Works

• Add Simulation to OptimizationSuppose you have several factories and want to find the best locations to manufacture different products to meet demand in nearby cities.

– You want to maximize profits and minimize shipping costsBut key factors out of your control are

uncertain: shipping costs, demand, etc

• With RISK Optimizer, those uncertain factors are represented with probability distribution functions (like Normal, Triangle, etc.) so that a Monte Carlo simulation can be run for each trial allocation of manufacturing volume.

• In this way, you can maximize the mean of the simulated output – say profits – an account for risk during optimization.

Using RISK Optimizer involves three simple steps

1. Set Up Your Model.

2. Run the Optimization

3. View Optimization Results.

FEATURES

• Optimization under uncertainty

• Six solving methods

• @RISK graphs and reports

• Efficient constraint handling

• 100% Excel calculations for simulation

BENEFITS• Solve problems with more accuracy then ever.

• Always have the best method for different types of problems

• Analyze your solutions with all @RISK graphs, reports, and features.

• With Opt Quest models, RISK Optimizer will not attempt solutions that fail constraints, make optimizations faster. Non-linear constraints are also fast.

• Highest level of computation accuracy

• 05-Saran• 10-Kishore• 27-

Manidhar• 37-Ruchika• 43-Shivani

THANK YOU