Abstracts

      » Download zip file of presentations from the Palisade London Risk Conference

 

Palisade overview and new features of DecisionTools Suite 6.0 and @RISK 6.0

Sam McLafferty
Palisade Corporation

Palisade today stands at the forefront of risk and decision software analytics. With offices around the globe and an exciting new release, more professionals are making decisions today with Palisade software than ever before.

Palisade president Sam McLafferty will give an overview of what Palisade does, and where it stands in the field of risk analysis. You’ll see that you’re in good company as he reviews recent noteworthy partnerships with leading global corporations in fields such as banking, energy, and manufacturing.

Then, he'll review new features in the 6.0 releases of @RISK and the DecisionTools Suite. Get ready for a demonstration of some of the remarkable new features in version 6.0 that make risk modeling both easier and more accessible across platforms. Version 6.0 is the risk modeling solution that anyone case use.

 

Risk in the wrong hands

Craig Ferri
Palisade Corporation

Palisade EMEA Managing Director Craig Ferri wraps up the conference by asking the questions you've undoubtedly been faced with: What is this risk analysis and why do I really need it? After all, risk management appears to have failed at many levels and even now companies are still trying to figure out how to grapple with risk. Craig will touch upon of the reasons for the failure of many risk management efforts, explore what happens if you ignore risk, and offer some simple quantitative solutions you can take with you back to your organisations.

 

Bringing Value to Enterprise Risk Management With Palisade’s DecisionTools Suite

Ghislain Giroux Dufort
Baldwin Risk Strategies Inc.

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Enterprise Risk Management (ERM) could be defined as a comprehensive and holistic method to identify, evaluate and manage all significant risks a company or organisation may face - or should be taking - to achieve its objectives, fulfil its mission and add value given its risk capacity and appetite. Nearly 20 years after its introduction, ERM has grown substantially around the world and its practitioners have agreed on a concise international standard to guide its implementation (ISO 31000).

Over the last year, I heard and discussed with risk management leaders and practitioners of 150 global companies and organizations from 23 countries in order to take the pulse of ERM implementation and capabilities. I came to the conclusion that the quantification of key risks for decision-making purposes was rather limited overall. Yet, quantification is the best, if not the only way to demonstrate risk-management value-added. During this presentation I will first propose a brief overview of current ERM practices. I will then look into the established qualitative color-coded risk maps of ‘Likelihood Vs. Impact’. Finally, I will suggest pathways through which Palisade’s software could help practitioners go naturally beyond those risk maps and potentially add value to the business decision-making process.

 

 

@RISK's role in biosecurity: Reducing disease risk when data is limited

Dr Chris Walster
Island Vet Clinic

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It is estimated that the human population will be nine billion by 2030. According to the FAO, the only agricultural industry with sufficient potential to meet the protein requirements of this population is aquaculture, which currently provides around 50% of the fish and shellfish we eat. One of the primary constraints to achieving this objective is disease losses which were estimated by the World Bank in 1997 to be US$3 billion annually. It is currently estimated that 40% of insured losses are due to disease which causes problems in the operation and development of the aquaculture insurance market. Consequently the implementation of appropriate biosecurity measures (the prevention, control and possible eradication of disease) is seen as vital. However, compliance with biosecurity measures is often poor being related to level of education, training, responsibility and perceived economic benefits.

Global estimates of disease losses may appear remote and inapplicable to farmers and producers who are often faced with having to make the rational choice from scarce data and often with even scarcer resources. This can and does lead to failing to recognise the actual risk being taken and can lead to disease incursion with catastrophic consequences for the business. This presentation looks at how a veterinarian can easily use @RISK to assist in designing a relevant biosecurity plan for an individual farm or local grouping. This is achieved using @RISK to:

  • Run complex spreadsheets with minimal input
  • Minimise sampling costs for determining the probability of disease presence and ongoing surveillance
  • Improved accuracy in determining risk probabilities leading to smarter decisions
  • Better understanding of complex results for the client through use of @RISK's visuals such as graphs.

Overall this will achieve greater compliance through managing expectations, maximising cost benefits and improved use of resources.

 

Are real investment decisions based on risk adjusted performance measures consistent with maximizing shareholder value?

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We show that the usage of risk adjusted performance measures (RAPM), such as the Return On Risk Adjusted Capital (RORAC) or the Risk Adjusted Return On Risk Adjusted Capital (RARORAC), as decision criterion for real investment decisions might favor projects that do not maximize shareholder value for project selection of mutually exclusive projects. We find that RAPM based on the Conditional Value at Risk (CVaR) are in general more consistent with the NPV-criterion than RAPM based on the Value at Risk (VaR). In addition, measures that are based on the relative (C)VaR are more consistent with the NPV-criterion than measures based on the absolute (C)VaR. Overall we find that the RARORAC based on the relative (C)VaR outperforms all evaluated RAPM in this context.

 

Building quality into business decisions

Andrew Evans
Unilever

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In an environment of ever-compressing timescales, increasing complexity, and escalating levels of uncertainty, how can decision analysts deliver quality in decision making? When analysis needs to be presented to time-pressed executives, how can the evaluation team ensure that all salient points are presented without overloading the decision maker with information? Whereas an effective analytical capability is an essential component, decision quality will only be maximised if context and communication are also considered as part of the decision making process.

Unilever products are sold in more than 180 countries, it employs more than 167,000 people and has an annual turnover in excess of €40 billion. By any definition this is a large and complex organisation and on a daily basis, it needs to make numerous high quality strategic decisions. Decision Analysts at Unilever use an established process to build quality into decision making, and this is underpinned by three main components. Firstly, a full understanding of the frame to ensure that the correct problem is being addressed. Secondly an appropriate level of analysis balances the need for rigour against the need for timely decisions.  Thirdly and finally, effective communication of the recommendation(s) to decision makers in a  concise and compelling way builds their commitment to action.

 

 

Creating trend analysis and calculating risks by security incidents for ISMS on ISO 27001 compliance using @RISK and StatTools

Dr Vladimir Savin
EPAM Systems

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EPAM Systems created Integrated Information Security and Quality Management System (ISMS&QMS). ISMS is based on the EPAM Information Security Policy reflecting most of the requirements of ISO 9001:2008, ISO 27001:2005, SAS 70 TYPE II, COBIT V4.1. ISMS provides a model for establishing, implementing, operating, monitoring, reviewing, maintaining and improving the protection of information assets to achieve business objectives based upon a risk assessment and the organisation's risk acceptance levels designed to effectively treat and manage risks. They are being maintained continuously, including synchronising the company processes with the quality standards.

This article addresses the issues associated with effectively implementing statistical process control (SPC) to manage and improve of trend analysis of security incidents and weaknesses model. It is proposed by results of ISO 27001 External Audit.

It is considerable to prepare long term trend analysis of security incidents and weaknesses for better prevention of incidents recurrence. Development of trend analysis model is based on the monthly security issues that are stored in the special project of Project Management Center. Issues for 2010 have been used for analysis.

There are above forty offices in different countries. To calculate risks by each office security incidents during year are analysed. One of the techniques that are used to establish operational limits for acceptable variation is the use of Control Charts (by means of StatTools). It is used for quantifying process behavior. Mean of distribution and standard deviation of the distribution are determined by each office and total by corporate using Control Charts. By means of @RISK these parameters are defining for normal distribution. We are calculating risks by security incidents by each office using Confidence Interval, Monte Carlo Simulation with @RISK. As an aggregation, modeling the complete behavior with Monte Carlo, with @RISK, the security incidents expected in the complete set of offices are determined too. @RISK uses Monte Carlo simulation to analyse thousands of different possible outcomes, showing the likelihood of each occurring.

Additionally, to get full picture of trend analysis of security incidents, we are using StatTools. We calculated:

  • Regression Equation reflecting dependence Security Incidents Total by Offices vs. Total Equipment by Offices using Regression Analysis. Here we are using Simple Multiple one.
  • Time Series Analysis to forecast of common number of security incidents next year. Holt's exponential smoothing method for capturing trend is implemented.
  • Pareto analysis charts. Pareto charts are based on data in two formats - Category Only, or Category and Value. We used Pareto Chart of Security Incidents by Offices (Category and Value) and Pareto Chart of Country.


Comparison of aleatory and epistemic uncertainty modelling, using @RISK

Dr Hans Schjær-Jacobsen
Copenhagen University College of Engineering

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Aleatory uncertainty of a system arises from the random behavior of system input parameters typically represented by probability distributions giving rise to random output parameters also represented by probability functions. Epistemic uncertainty of a system corresponds to ignorance about the input parameters usually represented by possibility distributions like intervals and fuzzy numbers resulting in output variables represented by interval or fuzzy numbers. The alternative ways of modeling uncertainty requires quite different approaches to calculation. The first one calls for statistical methods like Monte Carlo simulation whereas the second one relies on methods for calculating interval functions. While Monte Carlo simulation is generally applicable to both monotonic and non-monotonic functions, interval calculations with non-monotonic functions calls for application of global optimisation methods because minima and maxima are not attained at the interval endpoints. For example, calculation of the non-monotonic interval function f(x) = x (1-x) on the interval x = [0; 1] gives the result [0; 1] when the interval endpoints are used, but [0; 0.25] when the global minima and maxima are found. In the presentation it will be demonstrated that uncertain numerically identical input parameters results in numerically very different output parameters depending on the input parameters being interpreted as uncertain in the aleatory or epistemic sense.

 

 

The critical link between quantitative risk analysis and project approvals - improving the performance of UK MoD Equipment Procurement Projects

Martin Hopkinson
Risk Management Capability

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Quantitative risk analysis has been increasingly used as a project management tool over the previous four decades. This paper offers evidence that supports the thesis that, if conducted to a sufficiently high standard, project risk analysis can be used to support decisions in way that make it more likely that they will be delivered within their approved objectives. This evidence may encourage organisations to invest more time and effort in their project risk management process, particularly prior to key project go / no go decision points.

The evidence provided by this paper is based on project performance statistics for major defence equipment procurement projects owned by the UK Ministry of Defence (MoD). These statistics are drawn from six successive annual MoD Major Projects (MPR) Reports (2005 - 2010) produced by The UK's National Audit Office (NAO), disclosing project performance over the period April 2004 - March 2010. An analysis of these statistics has been used to assess actual project outcomes relative to forecasts at the principle point of project approval: Main Gate.

The analysis of project performance trends suggests that actions taken by the MoD to improve its project risk management capability has improved its control over project outcomes. Thus, an increasing proportion of projects have been delivered within the risk tolerances approved at Main Gate. The proportion of projects showing exceptionally serious cost and schedule overrun has also been reduced significantly. Since the most significant improvements would appear to have been gained by implementing a discipline that ensured that projects would produce more realistic risk models prior to Main Gate approval, there is clear evidence of the difference that quantitative risk analysis can make to project control.

 

Determining the optimal time to repeat the operation analysis for the Final Nuclear Waste Deposit Fund using @RISK

Dr Ionut Purica
Romanian National Commission for Economic Forecasting

The nuclear Agency of Romania has requested an analysis to determine the amount of tax on the MWh produced by the nuclear power units in the country to fill the Nuclear Waste Deposit Fund dedicated to the investment in the deposit of nuclear waste at the end of the units life. Due to changing conditions both in the production of energy and in the other parameters associated to the fund operation it was important to determine the best period of time at which to repeat the analysis of the fund operation. This was done by using @RISK applied to the general fund simulation model and the results are presented in the paper.

 

 

Development of an innovative game that simulates the dynamics of a wind power company, using @RISK

Sergio Pinar
Global Risk Strategy

“Wind Challenge” is a game that simulates the dynamics of a wind power company. The game was developed to teach analysts and investors, students, and businesspeople about the wind power industry. Each player acts as the CEO. The player who develops the highest stock price for the wind power company wins. This presentation will discuss the main points of the game model, including wind power market information, the relevant wind power company information, and the primary decisions that a CEO must consider. @RISK was used to develop several aspects of the game which involved stochastic or probabilistic variables, including:

  • Regulatory changes: The probability of a change in remuneration, and its impact, are calculated using probability distribution functions that weigh the risk-return of each country as probability conditioned variables.
  • Energy spot prices are modelled based on an expected value, and an associated volatility.
  • Turbine prices depend on offer-demand dynamics and on raw materials. The raw materials piece is modelled using functions of @RISK.
  • Development of wind farms using stochastic functions. Acquiring the necessary permits to build depends on the ease of developing in each country, and on probability.

 

Evaluating the risks associated with energy and the carbon constrained economy, using @RISK

David Hart
Energy Intelligent Solutions

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Energy Intelligent Solutions, in collaboration with others, are using risk analysis tools to evaluate the risks associated with energy and the carbon constrained economy for energy intensive industries, and to develop robust strategies.  What are future energy prices, which fuels will be available, what is the demand for our products in the future, how successful will we be at energy and carbon management and what will our energy demands be, will customers buy our products if they are not low carbon, …? These uncertainties need to be considered and a strategy for energy and carbon developed which takes account not only of likely scenarios, but also those which may represent a disaster for the company.

 

 

Financial risk analysis for software startups

Austin Dimmer
Effective Computing Ltd

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The main drive of this presentation will be to demonstrate how Effective Computing have used the Palisade tools to gain deep strategic insight into how the company believes it can make money. The talk will also cover the various applications of the risk model for investor valuation, partner profitability and employee incentivisation.

 

 

Fitting with @RISK - The distribution function for labour consumption in shuttering works

Dr Christian Hofstadler
Institute of Construction Management and Economics, Graz University of Technology, Lessingstraße

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Determining labour consumption for works requiring a high amount of labour is crucial both for the client at the project planning stage and for enabling bidders to prepare their quotations. Amongst other things, the client should estimate the anticipated construction costs and the construction time required for the project on the basis of the expected labour consumption. Clients are well-advised to use realistic values for estimating construction time. If the construction period specified by the client is too short (i.e. values exceed or fall short of productivity loss thresholds), the client will still be able to commission contractors but its project targets are at risk even before construction activity has commenced. The quality of the building or structure suffers particularly strongly from construction periods that are too short.

The bidders prepare a binding quotation for the specified works and services and the determined construction time. On the basis of the specified structural and site conditions, they should assess if the production factors can still be utilised efficiently within the specified construction period. If this is not the case, this should be reflected in the calculation of labour consumption, and ultimately in costing. In this regard, the difficulty lies in determining sufficiently accurate values to be used for calculating labour consumption rates for the individual works. In construction practice, a deterministic approach is mainly chosen for this purpose. This method is usually a quick and easy way of determining labour consumption rates but it provides no information on the probability of occurrence of these values. For those performing the costing exercise, and thus the decision-making party, the opportunities and risks associated with the quoted prices are neither clearly identifiable nor can they be derived in a plausible manner. To reduce the uncertainties that result from the input parameters used and from the interpretation of results, it is useful to allow for input parameter ranges in order to enable conclusions regarding the probability of occurrence. Reliable information on which of the parameters (labour consumption rates, output, labour productivity, costs etc) exceed, or fail to reach, the assumed levels and on the associated probabilities is of enormous help for cost surveyors, process planners, decision makers etc.

This paper describes the deterministic calculation of the total labour consumption rate for reinforced concrete works and demonstrates the individual computation steps using a built example. The computation chart for applying the Monte-Carlo method with @RISK is shown, and calculations are demonstrated using various distribution functions (symmetric and asymmetric triangular distribution, rectangular distribution and beta distribution). Another point to be clarified was to determine the labour consumption rate distribution function that comes closest to the real situation. An expert survey was carried out at Graz University of Technology in order to arrive at a conclusion regarding the most accurate distribution function for floor slab shuttering works. Seven different building layouts were presented to selected construction industry experts who were to indicate labour consumption rates for each of these layouts. In this survey, 18 experts stated labour consumption rates for simple and complex layouts. The outcomes were summarised and analysed for the individual building layouts. The @RISK software was used for fitting the most appropriate distribution function. The Kolmogorov-Smirnov test proved that the LogLogistic distribution came closest to the real situation. The outcome of the study was verified on the basis of the investigations carried out by Chau, and a good correlation was found. Both the study and the comparison revealed that the distributions were right-skewed because the experts tended to state labour consumption rates at the low end.

Monte-Carlo simulations performed using the LogLogistic distribution determined in the fitting process after the expert surveys should show the degree of difference to the previously used distribution functions. It is discussed whether it is useful to carry out Monte-Carlo simulations for the purpose of determining labour consumption and consequently construction time and costs without knowing the actual form of the distribution function.

 

 

Intelligent and live predictions by the application of NeuralTools in discriminating sugicopathological changes in brain tumours with uncanny accuracy

Dr Tapan K. Biswas
Indian Radiological Association

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To improve the visibility of internal body structures MRI contrast agent Gadolinium are used. Contrast mediated Nephropathy and Systemic Fibrosis are two notorious irreversible complications. Palisade's Neural network tool (NNT) was used to get the “probable image signal values” of post contrast images. After that a brain mapping technique simulates a post contrast image of the brain lesions overlay on the pre-contrast images.

 

 

Life cycle investment scheme with @RISK: The case of the “Phoenix Fund”

Ido Kallir
Graduate School of Business - University Tel Aviv

The pension market in Israel is unique. Following the 1995 reform all pension and provident funds were privatised. Since 2008, having a pension plan is mandatory. In 2010 the pension market's value passed 1200 Billion NIS ( ~330 Billion USD). Yet, the common investment method remained conservative and most funds stick to "1 fit all" horizon and risk.

During 2008, one of the four largest Insurance & Pension groups in Israel, decided to modernise its investment method. The Phoenix's model of choice is based on state of the art financial models such as Rolling MVF and Life Cycle approach. To build such a model required a sophisticated yet robust mechanism of Asset Selection.

The task of turning an academic model into a sound, practical system required methods and tools. We utilise Palisade's @RISK package in three substantial stages of our model:

  1. We use the correlation functions to simulate missing historical returns. As we use elongated periods for our calculations, some Asset classes lack sufficient data. The correlation matrix ability allowed us to simulate "out of sample" data.
  2. We use Campbell & Vicieria (2006) methods by clustering monthly returns into long (60 periods and up) repositioning periods. As these periods overlap, actual correlations may distort. Current literature does not present statistical confidence level for an acceptable level of overlapping. We simulated a "2000 years of trade" with numerous scenarios. Thus we are able to use our data base in an optimal way.
  3. Each individual in fund has a personalised, unique investment scheme, based on his age, current wealth and taste for risk. The Asset allocation is modified periodically, following a sigmoid shape that is best fitted to the Life Cycle model. Therefore, any projection of one's "Future Value" and VaR (Value at Risk) can be made only with a strong simulation. We use @RISK also for it's ability to test several distributions and apply the best fitting one in a swift and easy to use manner.

During October 2011 we celebrated 2 years since the fund was commercially launched. It was also the 1st period for which we could officially publish our results. The fund is rated 1 performer in the Treasury's website, with annual return of more than 8%. By the end of 2011, we expect the fund to reach 2 Billion NIS, one of the top growing funds in the past year.

 

 

A new approach to financial risk modelling using The DecisionTools Suite

Vojo Bubevski
TATA Consultancy Services

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A new stochastic approach to Financial Risk Modelling is proposed, which combines Monte Carlo Simulation, Optimisation and Six Sigma methodologies. This new method determines an optimally diversified minimal variance investment portfolio, i.e. the portfolio which gains a desired range of return with minimal financial risk. Simulation and optimisation are conventionally applied to find the minimal variance portfolio to provide the required return. In addition, the Six Sigma methodology is used to define, measure, analyse, improve and control the portfolio management process in order to establish the optimally diversified portfolio. Applying Six Sigma to the portfolio management process is an improvement in comparison with the conventional stochastic financial risk models. The presented method utilises the Palisade™ DecisionTools Suite® software.

 

 

Modelling the psychology of decision making

Christopher Brand
Captum Capital Limited

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People make decisions every day; but how? There has been a long history of research documenting how people deviate from normative models of decision making; in other words, how people are predictably irrational. In the past decade, probabilistic models of decision making have become increasingly popular within psychology and cognitive science.

Tools such as Palisade's DecisionTools Suite are frequently used to model the possible consequences of our decisions, but such tools may also aid us in modelling the underlying processes behind those decisions. Of particular interest is how they may allow us to model decisions based upon abstract values, which may vary wildly from person to person.

This presentation will both discuss recent developments in the psychology of decision making, and demonstrate how Palisade's DecisionTools Suite may be used to implement probabilistic models of decision making - specific examples will include a model of moral decision making; how moral values influence our decisions. The potential usefulness of Palisade's software as a teaching tool for the psychology of decision making will also be demonstrated.

 

Modelling operational risk using @RISK and the inclusion of irrational human behaviour that causes operational failures of the business

Dr Madhu Acharyya
Bournemouth University Business School

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I use @RISK in research and teaching on Enterprise Risk Management (ERM) postgraduate level at the Bournemouth University in the United Kingdom. ERM is a concept of managing all risks of a business in a holistic framework rather than in departmental silos (e.g., accounting, finance, human resource, etc.). I recently applied @RISK to run Monte Carlo simulations in a set of operational risk data for insurance companies. The modelling and measurement of operational risk is a new issue both in the banking and the insurance sectors. These two sectors categorise operational risk as their core risk along with market, credit and liquidity risks. It is believed that the operational risk is the ultimate cause of failure of many banks (e.g., UBS, RBS, BoA, etc.) and an insurance company (i.e., AIG) in the recent global financial crisis. Under the capital adequacy regulations (i.e., Basel II and Solvency II) the banks and insurance companies must model and quantify their operational risk s and deploy adequate capital as a buffer to protect themselves from the implications of their operational failures. My study models the five individual sub-categories of operational risk of an insurance company and aggregates them in a holistic framework. However, it is challenging how the subjective elements (i.e., the irrational human behaviour in business decision making) can be accommodated into the modelling exercises of operational risk using @RISK. The study suggests the need of further research on this emerging topic.

 

Resource allocation in your project portfolio – simulating towards an optimum

Jan Van Broeck
Threon

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Taking into account the demographic evolution in Europe, scarcity of resources will be a major challenge in the coming years. Combined with the increased complexity of projects, requiring a variety of critical expertise, the search for the optimal allocation is on the agenda of each portfolio or resource manager. Whilst there is no miracle solution today, the impact of decision parameters on the outcome of the resource allocation simulation is demonstrated through simple examples in this presentation, allowing for better understanding for all stakeholders. Could this be a first step towards more intelligence in our resource allocation, more awareness at senior management level, and more efficiency in the execution of our portfolio?

 

Risk Analysis - How to spot bad practice

Peter Wood
Peter Wood Associated Ltd

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Key decisions may rely on results generated by risk models. Yet people who make decisions are unlikely to be experienced risk analysts although they might doubt the reliability of results.

This presentation explores areas of possible weakness in risk modelling and suggests some tests of good practice that can be applied by non-experts. Who should attend? Decision-makers who would like greater confidence in accepting results from risk modelling, and risk analysts who would like to present their outputs with greater confidence.

 

 

Risk for export-losses in Chinese-EU's oilseed market and hepatic disorders among Chinese patients, using @RISK

Dr Micha Vered
Eurolapis Ltd

Today, there are many differences and disagreements between China and the EU on standards for aflatoxin B1 levels. Both regions legislation of aflatoxin levels in food and feed is based upon knowledge and understanding of aflatoxin toxicity. Aflatoxin B1 is the most potent naturally occurring human liver carcinogen known. Edible oil industries, such as maize, and peanut (rapeseed still unknown) are well known as major contributors to human exposure to aflatoxins. Risk assessment (countervailing risk test) could provide risk values for the synergistic effect of aflatoxin B1 toxicity and liver diseases that ultimately leads human hepatocellular carcinoma (HHC) into liver cancer. For this uncertainty and approximation analyses, a Monte-Carlo model have shown potential loss of peanut and rapeseed Chinese export. Today, only 7% of oilseed production (mostly peanut) is exported, but the potential for "export losses" as a probable threat is equivalent to China's total oilseed production. A very preliminary risk assessment shows that the total potential export losses in 2009 for peanut could be as high as 10 billion USD. A further objective will be to identify which region, (Europe or China), will suffer more from the heavy impact of tighter mycotoxin standards, and to address risk-risk tradeoffs between health benefits and economic losses stemming from compliance with those regulations.

 

Risky Models: Why probability estimates aren’t always what they seem.

Dr Michael Brand
Captum Capital Limited

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Stochastic models invariably include defined or implied estimates of the probability of future events. Over the past three decades, behavioural economists and psychologists have gathered a significant amount of evidence suggesting that most people find it surprisingly difficult to make accurate judgements about probabilities.

While the probabilities of simple two-outcome events may be estimated with reasonable accuracy, as an event becomes more complex and is influenced by external factors, so the reliability of the probability estimate decreases. In addition to inherent biases in probability estimation, risk aversion will also influence decisions based on stochastic models.

This presentation will discuss some classic examples of probabilistic decision making where intuition and judgements are regularly incorrect - such as the Monty Hall problem, and the St Petersberg Paradox. @RISK models will be used to demonstrate how these errors in probability judgement occur. In this context, @RISK is used to illustrate potential biases and errors which may be incorporated in @RISK models.

Recognising that errors in estimating probabilities can and do occur is the first step in reducing their impact on decisions made using stochastic models. While decision makers can and do rely on the “numbers” and possibly on the probabilities associated with them, it is important to appreciate how fragile such decisions might be.

 

 

Risk simulation and scenario foresight using @RISK

Dr Kim Bang Salling
Institute for Transport

Michael Bruhn Barfod
Institute for Transport

This presentation introduces the brand new approach of integrating risk simulation and scenario foresight within transport project appraisal (SIMSIGHT). The approach is based upon quantitative risk analysis and Monte Carlo simulation and conventional cost-benefit analysis converting deterministic benefit-cost ratios (BCRs) into stochastic interval results. Recent research has proven that particularly input based impacts such as construction cost and travel time savings often are respectively underestimated and overestimated creating so-called Optimism Bias. Decision-makers and stakeholders are, hereby, often basing their decisions on inadequate material. The UNITE Modelling System introduces an integrated approach by allowing decision-makers and stakeholders to participate in the project appraisal scheme at an early stage by attending a preliminary decision conference (DC) in order to provide input variables to the decision support model. The participants (i.e. stakeholders, project owners, decision-makers, etc.) will during a 1 or 2 day seminar be brought together with the purpose of discussing and agreeing upon respectively an absolute MIN and MAX value with respect to the construction cost estimates and travel time savings. Correspondingly, a set of extreme values are collected in terms of reference classes (RC) depicting Optimism Bias within transport projects where investment costs have a tendency to be underestimated and demand forecasts, that lays the foundation for travel time savings, to be overestimated. Combining respectively the DC and RC input in a common framework model provides information with respect to the resulting SIMSIGHT transport appraisal system. Herein, the extreme MIN and MAX values from the RC database are combined with the absolute MIN and MAX values from the DC in order to derive a general probability distribution function denoted the SIMSIGHT distribution for transport appraisal. The SIMSIGHT approach will be tested and further explored upon a case example depicting a new fixed link between Elsinore (Denmark) and Helsingborg (Sweden). Finally, a conclusion and perspectives of the further work will be presented.

 

 

Simulation-based risk-adequate valuation on imperfect capital markets with @RISK

Marco Wolfrum
FutureValue Group AG

Dr. Werner Gleißner
FutureValue Group AG

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The amount of risks of a project, of a business unit or a company determines the risk-based capital structure (capital requirements), the probability of default (rating), minimum requirements for the expected rate of return (WACC) and company's value. In all these fields of application the risk level is always expressed in a number, a dollar amount (in Euro) or a return. Risks need to be quantified.

Risk is thereby generally referred to the possible deviation from a projected value (as unbiased as possible). The quantitative description of a risk requires the use of frequency or probability distributions (and accordingly in the case of multi-period stochastic process). Risk therefore deals with the inevitable possible deviations from plan because of the uncertain foreseeable future, which incorporates opportunities (potential positive deviations) and threats (potential negative deviations).

This paper deals with the central technique of simulation-based risk aggregation for risk management, thus determining the total risk (e.g. capital requirements) based on quantified individual risks and based on that, it will be explained how capital costs and enterprise values respectively can be derived from the probability distribution of its uncertain returns (earnings).

It is shown that in an imperfect, incomplete market the values, especially of non-listed companies (or of individual business areas of listed companies) can be ascertained with the specific restrictions and the information state of the evaluator being taken into account. The computation starts with the probability distribution of the uncertain returns series ZA to be evaluated, which is consistently transformed to the expected value E(ZA) and a risk measure R(ZA) that need not be the standard deviation (but can also, for example, be the value at risk). This consistency between the expected value of returns (as derived from planning) and the risk measure is not given if the latter (as for example in practical utilisation of the CAPM) is determined from capital market data but strict information efficiency in the sense of Fama (1970) is not assumed at the same time. All in all, the approach proposed here shows how evaluation of companies that reflects risks appropriately is directly possible on the basis of company planning that creates transparency of risks while taking account of capital market imperfections.

 

 

Simulation and forecasting of hydrological power generation: An alternative approach using @RISK & StatTools

Dr J. Andrew Howe
TransAtlantic Petroleum

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In this case study, we develop a model for simulating and forecasting total weekly power generated from a large dammed river system in the United States. The source data is taken as 100 years of generation output from an updated scheduling model and operation procedures based on historical weather and precipitation data. A more typical approach to this kind of modeling would be to stochastically model the weather and precipitation characteristics, all the scheduling and operating procedures, as well as the economic drivers of supply and demand. Our proposed approach infers the seasonal distributional and variability characteristics from these drivers directly from the modeled data. Our model makes it easy to layer in various types of deterministic components (i.e., trends and levels) to the simulated time series for testing various scenarios. Finally, we implement a novel “library” method to match actual power generation at a specific season and forecast future results.

Our model breaks the calendar year into seven seasons of weeks based on similarities in the distributional shapes, variabilities, and trends. Each season is stochastically modeled independently, then stitched together. The turning points between the seasons are modeled to prevent unrealistic inter-seasonal jumps. Descriptive statistics measured on 50 years of both modeled and simulated data match very closely average generation, variability, and first-order correlation most notably. Since the source data was based a century of weather and precipitation, the variability imparted by the model is enough to consider periods of extreme drought. There is no visible difference between simulated hydro generation histories and the modeled data.

 

 

Smart City orchestration via integrated decision analytics, using The DecisionTools Suite

Scott Mongeau
SARK7

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This presentation examines Smart City orchestration from an Operations Management / Management Science perspective using hand-on examples employing the range of tools from the Palisade DecisionTools Suite.

Driven by a futuristic vision of sustainable urban environments, the Smart Cities concept has excited the enthusiasm and imagination of a broad range of stakeholders. With over 50% of the Earth's population living in urban areas, a number predicted to top 70% by 2050 (according to the UN Department of Economic and Social Affairs), it is clear that better architected cities would greatly benefit broad human welfare. The most rapidly growing urban areas are in developed countries, where squalor and environmental degradation threaten to steadily move hand-in-hand with so-called progress. Clearly, while there is the luxury to speculate on such utopian visions as the Smart City currently, the inertia of urbanisation combined with global population growth, climate change, socio-economic instability, and natural resource constraints promise to make this a more pressing and urgent need in the next two decades. However, is this but a case of a buzzword propelled by well-meaning hype? While a great deal of speculative scenarios have been spun advocating the Smart City vision, tangible specifics are at best diffuse and at worst tenuous. What are the operational prospects for streamlining future cities? Moreover, what of the implied complex problems which inter-system urban dependencies create? The biggest stumbling block to Smart Cities is the inability of focused stakeholders to make complex decisions in environments of complexity.

Enter integrated decision analytics to coordinate thorny system-of-system urban orchestration and planning problems. Palisade DecisionTools Suite is an ideal vehicle for conducting the deep analysis needed to separate the hype from the tangible economic value-driven factors needed to ‘green light’ Smart City initiatives. This presentation makes the case for value creation via deep, integrated decision analytics. Starting with targeted hands-on example cases, the presentation progresses to show how integrated analytics will be a keystone in the prospect for moving the Smart City vision from wishful-thinking to executable specifics. The range of Palisade tools are used to show how stochastic risk analysis (@RISK), rational prioritisation (PrecisionTree), efficiency optimisation (Evolver), and predictive planning (NeuralTools) offer a concerted toolbox to bring together the complex system-of-system and human prioritisation challenges that underlie the Smart City challenge.

 

 

Uncertainty analysis in the assessment of costs and benefits for improved flood resilience of critical infrastructure, using @RISK

Alec Yeowell
Halcrow

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Extreme rainfall events in recent years, such as the summer of 2007, have severely affected the provision of water and wastewater services for customers of water companies, for example, Severn Trent Water and Yorkshire Water.

Understanding the resilience of critical infrastructure to infrequent return-period flood events is becoming an increasingly important consideration to UK water companies, especially where there may be an expectation of providing resilience to the 1 in 1000 year event ‘flood’ event.

Yorkshire Water and Halcrow have recently completed an initial investigation to assess and potentially improve the flood resilience at a range of critical water and waste water facilities. The study methodology included a broad screening exercise to identify sites at risk; quantification of the flood hazard and site surveys to assess site vulnerability. The probabilities and expected levels of flooding for selected sites were assessed against critical threshold levels and the vulnerability of the assets on the site to quantify the flood risk envelope in terms of the expected damage and lost service.

An approach using cost benefit analysis was developed to assess the potential benefits of making improvements to flood resilience for specific sites. The sensitivity of the investment decision to the uncertainties associated with key model parameters in the assessment were explored with @RISK.

The presentation will:

  1. summarise the initial implementation of a flood resilience framework
  2. give an overview of flood risk mechanisms
  3. use a case study to illustrate the investment decisions to mitigate risk, including the assessment of uncertainty associated with key decision making parameters.

 

 
 

Value-based credit management with @RISK

Beat R. Koch
Abendo AG

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When companies sell their products or services, they sometimes demand cash on or before delivery, but in most cases they allow some delay in payment. Therefore accounts receivable constitute on the average one-third of its current assets.

Most companies focus their credit decisions mainly on the customer's creditworthiness. There is a fixed cap for credit offers set in the company's credit policy. This single view approach sometimes leaves interesting business opportunities to be picked up by competitors, and potentially limits market penetration and value expansion.

In contrast, Value-based Credit Management extends trade credit as long as the expected value contribution of a specific customer exceeds cost (cash out) and risk involved with trade credit.

As both future value contribution (cash flows) and risk (volatility of cash flows) are uncertain, a Trade Credit Risk model needs to estimate expected value and tail risk to allow management accurate decision making on single order, customer or portfolio level.

Abendo AG has developed Trade Credit Models using @RISK to support value-based decision making in trade credit, allowing managers to actively manage current assets and improve shareholder value. The solution includes estimates on the profitability of offered products/services, and the value drivers linked to credit offering (default risk, cost, seasoning/timing).

With this model, management can determine whether to offer or decline trade credit. Companies can use trade credit as an effective promotional tool to attract high value customers, while low value customers are identified and avoided.

 

   
 

Customised software applications
using @RISK & VBA

Dr Javier Ordóñez
Palisade Corporation

@RISK and DecisionTools Suite software ship with full-featured development environments that allow you to create custom applications using Palisade technology directly in Excel (Excel Developer Kits or XDKs). You can customise the application interface to include only what the users need, hiding unused @RISK functionality and preventing user access to the underlying model logic. You can also automate processes like reporting, generating only the charts and data you want. The result is a perfectly tailored application ready to roll out to your workgroup. And because the application is in Excel, the training required for users is minimal.

Palisade Custom Development has written applications for cost estimation, asset management, retirement planning, oil and gas prospecting, and more – all utilising @RISK technology in Excel. In this presentation, we will cover as many examples of custom applications as time allows.

 

 

Introduction to @RISK

Gustavo Vinueza
Palisade Corporation

This introduction to @RISK will walk you through a risk analysis using various example models. Key features of @RISK will be highlighted and new interface enhancements in version 6.0 will be pointed out along the way. You will experience the intuitive interface of @RISK as you define distributions, correlations, and other model components. During simulation you will be able to see all charts, thumbnails, and reports update in real time. View results with a variety of graphing options. There’s so much to see, we’ll cover as much as time permits.

Please note this session is not an overview of the new features in version 6.0. That is covered in New Features of DecisionTools Suite 6.0 and @RISK 6.0.

 

 

Finding Optimal Solutions with
New Evolver and RISKOptimizer 6.0

Dr Mirek Janusz
Palisade Corporation

RISKOptimizer 6.0 and Evolver 6.0 use powerful algorithms to perform optimization in Microsoft Excel. RISKOptimizer builds on traditional optimization by adding Monte Carlo simulation to account for uncertain (stochastic), uncontrollable factors in your optimization problem. Both have long used genetic algorithms to arrive at solutions that are impossible to find using most traditional methods. New version 6.0 introduces new optimization methods from OptQuest that can find optimal solutions even faster than genetic algorithms.

This session introduces you to these powerful tools, showing you how to set up a model, define constraints within the model, and ultimately arrive at the optimal outcome.

 

 

Introduction to The DecisionTools Suite

Erik Westwig
Palisade Corporation

This session will show you how to use the elements of the new DecisionTools Suite as a comprehensive risk analysis, optimisation, and statistical analysis toolkit. Each of the products in the Suite — @RISK, RISKOptimizer, Evolver, PrecisionTree, TopRank, StatTools, and NeuralTools — will be presented as time allows, showing how they can be used to solve practical problems in the real-world. Pick up hints and tips for using the products together.

Please note this session is not an overview of the new features in version 6.0. That is covered in New Features of DecisionTools Suite 6.0 and @RISK 6.0.

 

 

Decision Modeling with PrecisionTree

Erik Westwig
Palisade Corporation

PrecisionTree is a powerful visual and analytical tool for mapping out complex, sequential decisions using decision trees directly in Excel. Using nodes, branches, and probabilities, you can represent and organise decisions ranging from oil prospecting to site development to options analysis. PrecisionTree can also be combined with @RISK to incorporate uncertainty and risk in tree models. This presentation combines an introduction to the PrecisionTree interface with demonstrations of how PrecisionTree can be used to analyse various problems in decision analysis.

 

 

Introduction to Project Risk Management
using @RISK 6.0

Dr Javier Ordóñez
Palisade Corporation

The aim of this seminar is to provide a basic understanding of how the new @RISK 6.0 can help you manage uncertainty in your Microsoft Project schedules. Using Monte Carlo simulation, you will learn how to account for schedule and costs risks in a quick and comprehensive way. At last, here is a way to answer the question “What is the probability that my project will come in on time and within budget?” And with new version 6.0, risk modelling of your Project schedules is much more flexible and powerful than ever before.

We will show you how to set up and run simulations, and how to interpret the results. You will learn how to use @RISK step-by-step, and become familiar with basic concepts and terminology. We’ll demonstration powerful graphing and reporting that pinpoints where your risks lie and what their impact may be.

You will see how using @RISK for your projects enables you to:

  • Calculate the probability of success
  • Graph the margin of error around the most likely outcome
  • Quantify and prioritise the risk drivers
  • Quantify the amount ‘@RISK’


 

Predictive and Data Analysis
with NeuralTools and StatTools

Dr Mirek Janusz
Palisade Corporation

In this session we will learn how to use Palisade’s two data analysis tools for Excel: StatTools and NeuralTools.

This session will cover how to use StatTools to perform the most common statistical tests, and will include topics such as: Statistical Inference, Forecasting, Data Management, Summary Analyses, and Regression Analysis.

NeuralTools imitates brain functions in order to “learn” the structure of your data. Once NeuralTools understands the data, it can take new inputs and make intelligent predictions. The new predictions are based on the patterns in known data, and offer uncanny accuracy. NeuralTools can automatically update predictions when input data changes, and it can even be combined with Palisade’s Evolver or Excel’s Solver to optimise tough decisions and achieve desired goals. We will demonstrate, using easy-to-understand examples, applications of NeuralTools predictions.

 

 

New features of DecisionTools Suite 6.0
and @RISK 6.0

Sam McLafferty
Palisade Corporation

Dr Mirek Janusz
Palisade Corporation

Erik Westwig
Palisade Corporation

The upcoming 6.0 release of the DecisionTools Suite and @RISK marks an exciting advancement in quantitative risk and decision modeling. Powerful new analytical tools and robust ease of use features will appeal to both new users and seasoned experts alike. In addition, version 6.0 makes risk modeling across different platforms much simpler than ever before. There is something for everyone in DecisionTools and @RISK 6.0, and Palisade president Sam McLafferty will lead a discussion of the most important new features. Other Palisade software engineers will also be on hand to answer questions and provide expert insights into how version 6.0 can work for you.

 

 

Selecting the right distribution in @RISK 6.0

Gustavo Vinueza
Palisade Corporation

This session covers the choice of the appropriate distribution in @RISK. A variety of approaches are presented and compared, including pragmatic, theoretical and data-driven methods. We will discuss the use of different distributions to address a wide range of risk modeling situations.

 

 

Time Series Analysis, a new tool in @RISK 6.0

Dr Javier Ordóñez
Palisade Corporation

In statistics, economics and mathematical finance, a time series is a sequence of data points, measured typically at successive times spaced at uniform time intervals. Examples of time series are weekly currency exchange rates, the daily closing value of the NASDAQ Composite index or monthly crude oil prices.

@RISK 6.0 now includes a Time Series Analysis tool. This new functionality will let you construct stochastic time series models or use historical data to fit time series functions to your data in order to predict future data points.

 

 

Distribution Fitting in @RISK 6.0

Erik Westwig
Palisade Corporation

Distribution fitting is an important modeling tool that allows you to use historical or industry data to define a probability distribution function in @RISK. In this way, you can use your data to most accurately describe the uncertainty you face. Fitted distribution types are ranked against your data set so that you can determine which of the distributions suit your situation the best.

@RISK 6.0 offers a wide range of enhancements in distribution fitting. Methods used to determine fits, statistical tests used to assess the quality of fits, and the user interface have all been improved. We will go over the latest changes to distribution fitting, and explain how you can get the most out of this powerful feature in your own risk modeling.

 

 

Best @RISK Features You Might Not Be Using

Gustavo Vinueza
Palisade Corporation

In this session, we will explain many of the less commonly used features of @RISK that are very useful for modeling. These “hidden gems“ are tools that can take your analysis to the next level, add new insights, or enhance the accuracy of your current process. Topics covered include the use of correlations and dependencies in models to represent relationships between uncertain inputs; @RISK Goal Seek, which uses simulation to arrive at a desired target value; Stress Analysis, which lets you focus on only the more extreme scenarios that you define; flexible uses of SimTable, which lets you run back-to-back simulations, changing one or more controllable variables you specify; and distribution property functions such as RiskSixSigma that you can “tack onto“ other @RISK functions. Other tips may be covered as time permits.

 

   
 

EXPERT SESSIONS
by appointment with Palisade experts and consultants

New this year, we are offering one-on-one consulting sessions with Palisade technical experts and consultants throughout the Palisade Risk Conference. Sign up for a 45-minute slot to meet with us and discuss your own risk or decision modelling challenges. Feel free to bring your laptop and your models. All sessions are confidential and there is no additional charge. All consultations will be held in separate room, though several one-on-one meetings may be going on at once.

Slots are available on a first come, first serve basis. To sign up, please contact your Palisade sales representative or email Jacky Pey at jpey@palisade.com.

 

   
 

Dr Madhu Acharyya
Bournemouth University Business School

Dr Madhu Acharyya is finance lecturer at Bournemouth University in the United Kingdom where he teaches investment, risk management and quantitative analysis.  In addition, he is a visiting lecturer at European Business School (Regent’s College) in London teaching bank risk management. Acharyya was graduated in mathematics and risk management and completed PhD in Enterprise Risk Management from the University of Southampton. His research interest focuses on the holistic risk management topics including financial risks, operational risks and microfinance solutions for climate change risks. His academic career is supported by ten years work experience in the financial industry. He extensively uses @RISK in his research and teaching.

Dr Tapan K. Biswas
Clinical Radiologist
Indian Radiological Association

Dr Tapan K. Biswas graduated MBBS in 1975 and Diploma in Medical Radiology in 1980 from the Calcutta University, India .He completed MD from the Ranchi University ,India in 1983 and started practicing clinical radiology. In 1998 and 2002 he got his Post Doctoral Fellowship in MRI and MR Spectroscopy from the William Beaumont Hospital, Michigan, USA. In 2006, he was awarded with the prestigious EIPRS Scholarship by the Australian Government and University of Sydney for the PhD work in Refractive index and MR Spectroscopy. In 2008 he went to Harvard Medical School, Boston, USA as a research fellow in Brigham and Women’s Hospital in the department of Spectroscopy and he worked till 2010. He achieved his PhD from the Woodfield University, Maryland, USA in 2010. He passed the Fellow of the Royal College of Radiology (FRCR-1)(London) examination in March, 2011. He got the Copyright from and applied for a patent to the Government of India for his ground breaking work in discriminating various brain lesions non- invasively by determining refractive index by MR and color coding brain mapping . He is now working as clinical radiologist and a teacher in MRI and MR spectroscopy in various CME course, conducted by the Indian Radiological Association for the Postgraduate students.

Christopher Brand
Associate
Captum Capital Limited

Chris Brand is an Associate at Captum Capital Limited, where he provides consulting and training services to early stage life science companies in the behavioral aspects of business development. He is also a PhD student at Birkbeck, London University where he is active in the psychology of decision making. Chris holds an MSc in Cognitive and Decision Sciences from University College, London, an MA in Philosophy from the University of York and a BSc in Philosophy and Psychology from the University of Keele.

Dr Michael Brand
Co-founder and Director
Captum Capital Limited

Michael Brand is a founding director of Captum Capital Limited, an innovative consulting company which provides business development services to early stage life science companies. Captum offers a series of training courses in business development, including the highly successful Valuing Life Science Technology MasterClass, which has been attended by over 350 executives. Michael spent most of his career in the USA holding senior executive level positions in multi-national corporations, including a venture capital company. He has successfully negotiated international joint venture, licensing and investment agreements. He holds a PhD from Imperial College, London, a MBA from the Sloan School, MIT, Boston, and the Investment Management Certificate of the CFA Society of the UK; he is a Fellow of the Royal Society of Chemistry.

Michael Bruhn Barfod
Department of Transport
Technical University of Denmark

Michael Bruhn Barfod is currently employed as an Assistant Professor at the Department of Transport at the Technical University of Denmark. He has recently finished his PhD study entitled: Optimising Transport Decision Making using Customised Decision Models and Decision Conferences. The study concerned the identification of appropriate techniques for Multi-Criteria Decision Analysis (MCDA) and the set-up of decision processes. Furthermore, he holds a Master’s degree within Civil Engineering. His research has mainly been concerned with methods and techniques for MCDA and composite modelling assessments where different methods are combined into an overall assessment methodology. Examples of such are AHP, REMBRANDT and SMART. Moreover, processes of group decision making is a central issue in his research. He has been involved in several projects concerning the development of decision support systems. Recently he has been involved in two projects, one regarding bikes and one regarding ITS systems, for the Danish Road Directorate assessing projects with very limited data using MCDA. Finally, he is responsible for an advanced Master course in Appraisal Methodology.

Vojo Bubevski
Senior Systems Analyst / Designer
TATA Consulting Services

Vojo Bubevski comes from Berovo, Macedonia. He graduated from the University of Zagreb, Croatia in 1977, with a degree in Electrical Engineering - Computer Science. He started his professional career in 1978 as an Analyst Programmer in Alkaloid Pharmaceuticals, Skopje, Macedonia. At Alkaloid, he worked on applying Operations Research methods to solve commercial and pharmaceutical technology problems from 1982 to 1986.

In 1987 Vojo immigrated to Australia. He worked for IBM™ Australia from 1988 to 1997. For the first five years he worked in IBM™ Australia Programming Center developing systems software. The rest of his IBM™ career was spent working in IBM™ Core Banking Solution Centre.

In 1997, he immigrated to the United Kingdom where his IT consulting career started. As an IT consultant, Vojo has worked for Lloyds TSB Bank in London, Svenska Handelsbanken in Stockholm, and Legal & General Insurance in London. In June 2008, he joined TATA Consultancy Services Ltd.

Vojo has a very strong background in Mathematics, Operations Research, Modeling and Simulation, Risk & Decision Analysis, Six Sigma and Software Engineering, and a proven track record of delivered solutions applying these methodologies in practice. He is also a specialist in Business Systems Analysis & Design (Banking & Insurance) and has delivered major business solutions across several organizations. He has received several formal awards and published a number of written works, including a couple of textbooks. Vojo has also been featured as a guest speaker at several prominent conferences internationally.

Austin Dimmer
Founder
Effective Computing Ltd

Austin Dimmer is the founder of Effective Computing Ltd a software start-up which has been on the Microsoft Bizspark program since January 2011. Austin holds a B.Eng in Engineering with Business Management and European Studies, and an Msc in Ergonomics from Loughborough. He is passionate about making the computing experience easier through voice controlled systems. He is not only highly literate in computer languages, he can also speak English, Spanish, French and Russian. His final accolade is that he was a member of Team Polar Storm who finished in 6th place on the 2006 Sony Polar Challenge, an endurance race that at the time was believed to be one of the toughest on the planet. Austin's session not only promises to be highly informative about the use of Palisades' DecisionTools Suite in the real world, it will also be extremely dynamic and entertaining.

Ghislain Giroux Dufort
President
Baldwin Risk Strategies Inc.

Ghislain Giroux Dufort is President of Baldwin Risk Strategies Inc., a Canadian consulting firm specialized in Enterprise Risk Management internationally. He has more than 20 years of experience in senior management, risk management,business continuity and international business. He has been an executive atTranscontinental Inc., Willis Canada Inc., Hydro-Québec International Inc., Export Development Canada, HEC Montreal Business School and Canada’s Mathematical Research Center, as well as a teacher of international business and risk management. He has an MBA from McGill University, as well as a M.Sc. in Applied Mathematics and a B.Sc. in Physics from the University of Montreal.

He is a member of the Financial Times Non-Executive Directors Club, the London Institute of Risk Management, the London Business Continuity Institute, theStrategic Risk Council of the Conference Board of Canada, the Global Association of Risk Professionals and the Professional Risk Manager’sInternational Association. Over the last year he participated in 15 international ERM / risk management conferences, including chair and speaker in Dubai, keynote speaker in Kuala Lumpur and plenary speaker in Toronto. In 2012 he will chair both the London Institute of Risk Management’s ERM Forum in Manchester and the ERM Conference in Kuala Lumpur, as well as speak to the ERM Conference in Dubai. He contributed to one of the first books on ERM, ‘Enterprise-wide Risk Management – Strategies for linking risk and opportunity’, published by the Financial Times in 2000.

Andrew Evans
Decision Analyst
Decision Analysis Group, Unilever

Andrew Evans is a Decision Analyst within Unilever’s Decision Analysis Group. His role includes training and coaching finance professionals on the Unilever Decision Making Under Uncertainty (DMUU) Programme, and providing internal consultancy on Decision Analysis for project teams. He also works on the embedding of Decision Analysis through the provision of support services to DMUU Practitioners. Prior to joining Unilever, Andrew worked in the Mobile Resource Management (MRM) sector of the IT industry.

Craig Ferri
Managing Director
Palisade EMEA

Craig Ferri was promoted to managing director of Palisade Europe in 2005, having joined as sales and marketing director for the region in 2003.  During that time the company has shown year on year growth. In addition to increasing brand awareness in EMEA and ensuring outstanding customer service, Craig’s helm at Palisade Europe has seen the company continue to expand throughout Europe, the Middle East and Africa, and more recently into India. Craig built up nine years' experience of sales and marketing roles in niche technology sectors prior to working at Palisade.  Key positions included global marketing director at software company Infomax Incorporated, and European marcomms manager at networking company Anixter. Craig holds a Bachelor of Science degree in Business and Marketing, and an MBA.

Dr. Werner Gleißner
CEO
FutureValue Group AG

As Chairman of the FutureValue Group AG, a research and development-oriented management consulting, Dr. Werner Gleißner deals generally with value-based management on the basis of enterprise valuation models for imperfect capital markets, taking account of corporate risk information and appropriate risk measures.

His research and work focuses on risk management, rating and strategy development and the development of methods of risk aggregation, value-based management, and investment and portfolio management.

He is the author of numerous articles and books and has teaching positions at various universities, including the University of Dresden and the University of Stuttgart.

David Hart
Director
Energy Intelligent Solutions

David Hart is a graduate of Cambridge University in Science and Chemical Engineering. He has worked for Esso, Shell and WS Atkins, and established Energy Intelligent Solutions in 1992. David is primarily involved in energy efficiency and carbon management, providing advice and solutions to energy intensive businesses, mostly in the industrial sector but also larger commercial organisations. In the last five years he has worked on projects for BP, Carlsberg, Centrica, Cleveland Potash, Honeywell, Rohm and Haas, Sainsbury’s, Marston’s, M and S and similar. David’s work includes the application of advanced computing solutions to the problems of energy management and process performance, using techniques such as data mining, optimisation and risk analysis. Much of the work is concerned with the evaluation of the risks associated with the carbon constrained economy, and the measures that can be taken to mitigate these. David is an advisor to Government programmes on energy and carbon, including the Enhanced Capital Allowances Scheme, and is the author of several guides on energy management.

Dr Christian Hofstadler
Institute of Construction Management and Economics, Graz University of Technology, Lessingstraße

Christian has been an Associate Professor at the Institute of Construction Management and Economics at Graz University of Technology since 2006. He teaches, conducts research and cooperates with the industry in the fields of construction management and economics. He’s gained practical experience in building and industrial construction as well as in bridge construction in 3 different construction companies. In the course of his work, he’s participated in the construction of fair-faced concrete components and structures. In the process, he’s gathered experience in formwork works, reinforcing and concreting. In general, his function at the institute is the planning and the optimization of construction works.

The main focus of his work is the optimization of reinforced concrete works from the point of view of construction management and economics.

His areas of expertise are:

  • Reinforced concrete works (technology, construction method, operations planning, logistics etc.)
  • Formwork works – technological foundations, fair-faced concrete, process comparison, sequence planning, logistics and cost estimation etc.)
  • Construction sequence planning and logistics in construction operations
  • Fair-faced concrete (technology, announcement, assurance of quality, operational sequence etc.)
  • Construction progress malfunctions (construction operational and construction industrial treatment of construction progress malfunctions)

Martin Hopkinson
Founder
Risk Management Capability

Martin Hopkinson founded Risk Management Capability Ltd in 2011. Prior to this he gained more than 25 years project experience, initially as project manager and later as a risk management specialist. Much of Martin’s work has been in the UK defence industry, where he has been the risk manager for major projects in sonar systems, ship construction, IT and communications systems and armoured vehicles.  However, he has also worked on a wide range of civil sector projects including the steel industry, space systems and the UK railways infrastructure.

Martin has made significant contributions to Association for Project Management (APM) guides on both risk management and the governance of project management. He was lead author for the Risk Tools and Techniques chapters in the 2nd edition of the APM’s PRAM Guide (2004) and chaired the group that produced Prioritising Project Risks (2008). His most recent publication is The Project Risk Maturity Model (2011), a book published by Gower with a working copy of the tool that has been used to assess risk management capability on projects with a combined value of more than £60 billion.  

Dr J. Andrew Howe
Corporate Analyst
TransAtlantic Petroleum

Dr. Howe is passionate about learning and reading, science, financial trading, learning, information, cutting-edge research, the human brain, classical music, and did I say learning? He acquired his doctorate degree in statistics from the University of Tennessee in 2009. Prior to that, he obtained his master degree in statistics and an MBA with a finance concentration; his undergraduate degree was in mathematics and physics. Industries Andrew has worked in include finance, healthcare, utilities, and petroleum. He began working with Palisade's @RISK software in 2006, and has championed it to both business and academia since.

Andrew is an experienced software developer, quantitative modeler, and data manager.  As well as his work in business, Dr. Howe pursues an active independent research life, with a wide variety of research interests including:

  • Information Complexity — How do we gauge the information in some data?
  • Model Selection — How do we choose a “best” model among many models that could fit some data?
  • Robust Modeling — How can we handle departures from the typical assumptions?
  • Statistical Computing — How do we actually apply the three above topics to real data to get real solutions?

Dr Mirek Janusz
Software Engineer
Palisade Corporation

Mirek Janusz is a software engineer at Palisade Corp. He holds a masters degree in computer science from Cornell University. He helped develop Palisade applications for risk analysis, statistical analysis and optimization, and has assisted other companies in integrating Palisade Developer's Kits into their own applications. He is the lead developer for Palisade's Excel add-in for neural networks, NeuralTools.

Ido Kallir
Graduate School of Business, University Tel Aviv

Assistant Professor at the “S. Peres Center” Rehovot, Israel. Research areas: Learning and Convergence models, Long Term investment models. Currently acts as the scientific officer of the life cycle division of “The Phoenix”, Israel.12 years of analytical experience with the High-Tech and financial sectors.Ph.D. Finance - Tel Aviv University , M.Sc. Finance and Accounting, The graduate School of Business, Tel Aviv University, Israel.

Beat R. Koch
Founder and Executive Partner
Abendo AG

Beat R. Koch is Founder and Executive Partner at Abendo AG, a Swiss consulting and management firm focused on value based initiatives in customer relationship and short-term financial management  projects. At Abendo he has advised multinational companies in Switzerland, Germany and the United Kingdom in various projects.

His professional interests and expertise are in financial value improvements in customer relationship including trade credit, operational and legal risk management, revenue management, working capital management and customer portfolio management.

Prior to Abendo AG, Mr. Koch held a number of senior management positions at Six Telekurs , Zurich Financial Services and Intrum Justitia Group. His international working experience include business positions as CEO / General Manager  in Switzerland, UK, Ireland, France, Germany, Sweden, Hong Kong and Japan.

Mr. Koch has a Master of Law from Zurich University, a MBA from Newport University and various university certifications in Corporate Finance (London Business School), Marketing (University St. Gallen / HSG), Financial Markets (Swiss Finance Institute), Credit Management (University of applied science Bochum), Service Management & Leadership (University of Lucerne / Arizona State University) and General Directorship (Institute of Directors). He is author and presenter of various topics in Credit Management, Risk Management, Working Capital Management and Customer Value Management.

He is a Certifies Credit Manager (CCM) and Chartered Alternative Investment Analyst (CAIA).

Sam McLafferty
President and CEO
Palisade Corporation

Sam McLafferty is Palisade's founder, president, and CEO. He started the company in 1984 with the release of PRISM, a stand-alone Monte Carlo simulation package for DOS on the PC. PRISM later evolved into @RISK for Lotus 1-2-3, and then for Excel. Sam is Palisade's lead developer, with over thirty years of programming experience. He works closely with the technical and sales staff, ensuring that customer feedback is heard. He personally oversees the development and evolution of every one of the fifteen software products Palisade sells. Prior to Palisade, he was a risk analysis consultant.

Scott Mongeau
Founder & Lead Consultant
SARK7

Scott Mongeau is a Management Science consultant operating via his own consulting firm, SARK7 (sark7.com). He is active in providing hands-on ‘opportunity optimization’ analytics and strategies for diverse global corporate clients. Scott has 15 years of experience in a range of analytic functions in the biotech / pharma, materials, insurance, and financial services industries. He is currently a part-time PhD research student at Nyenrode Business University focusing on Smart City orchestration solutions. He holds a Global Executive MBA and Masters in Financial Management (MFM) from Erasmus Rotterdam School of Management. He has a Certificate in Finance from University of California at Berkeley, a Masters in Communication from University of Texas at Austin, and a Graduate Degree in Applied Information Systems Management from the Royal Melbourne Institute of Technology as a Rotary Ambassadorial Scholar. Having lived and worked in a number of countries, Scott is an American citizen with Dutch residency, currently based in Leiden, Netherlands.

Dr Javier Ordóñez
Director of Custom Solutions
Palisade Corporation

Dr Javier Ordóñez holds a BS in Civil Engineering from the Universidad de Cuenca, Ecuador and a MS in Project Management from the University of Maryland. Javier earned his PhD from the University of Maryland performing research on project risk analysis. His current research deals with cost and schedule integration and correlation issues through the use of Bayesian belief networks.

Javier's experience is in the areas of construction and project management, optimal project and capital investments selection, earned value management, engineering and project risk analysis, and operations research applications to engineering and management problems.

Javier has taught as an adjunct professor in the Project Management Program at University of Maryland and provides training in risk and decision analysis. He is also registered as a Project Management Professional (PMP).

Sergio Pinar
Market & Risk Strategy Analyst
EDP Renovaveis

Sergio Pinar is a Market & Risk Strategy Analyst at EDP Renováveis, a world leader company in the renewable energy industry with presence in the most important markets. Sergio’s main responsibilities include the valuation of EDPR global risk exposure and the assessment in the risk management strategies. He performs analyses about portfolio value, diversification effect, hedging policies, financing risk, pipeline delivery and operational risk. Prior to joining EDP Renováveis, Sergio served as a Consultant at McKinsey & Company. Sergio holds a Master in Industrial and Electrical Engineering from Universidad Politécnica de Madrid.

Dr Ionut Purica
Senior Researcher
Romanian National Commission for Economic Forecasting

Presently a senior researcher in the Romanian Academy’s Institute for Economic Forecasting, and Executive Director of the Advisory Center for Energy and Environment, Dr Purica was also a counselor of the Minister of Economy and previously the Minister of the Environment and an expert for the Parliament of Romania. He participated in the elaboration of the EU accession strategy for Romania and the energy (electricity and heat) strategy (for the Ministry of Economy and Trade) and did risk analysis and transaction structuring and project management with USEA, JBIC, MARSH, ITOCHU, MVV, etc.

Previously Dr Purica worked as a project officer for energy and infrastructure in the World Bank, in Romania and the Balkans (e.g. energy Assessment in Kosovo 1999), being trained in project guarantees, value at risk and procurement. His initial expertise in engineering stems from being a director for international projects of the Romanian Power Company RENEL and senior engineer managing a joint Atomic Energy of Canada Ltd-IMG-Bucharest quality engineering group for the manufacture of nuclear reactor components for the CANDU units in Romania. He worked also as an international researcher for ENEA Rome – the Italian Commission for Energy New Technology and Environment – and as an associate researcher at ICTP Trieste.

Dr Purica has authored books in his field of expertise (www.icpress.co.uk/chaos/p656.html) and published articles in journals like Risk Analysis, IEEE Power Engineering Review, Foundations of Control Engineering, etc. He took his second PhD in economics, (the first one in Nuclear Energy Engineering) and, he is also teaching a course in Risk management to masters of science in the Polytechnic University of Bucharest and the Ecological University.

Dr Kim Bang Salling
Department of Transport
Technical University of Denmark

Kim Bang Salling is currently employed as an Associate Professor at the Department of Transport at the Technical University of Denmark. He defended his PhD thesis entitled: Assessment of Transport Projects: Risk Analysis and Decision Support, in November 2008. The latter concerned a decision support model for assessing transport infrastructure projects. By use of the developed CBA-DK software model a new risk-oriented methodology for feasibility risk assessment was developed. He furthermore holds a Master's degree within transport planning and assessment with special emphasis on cost-benefit analyses and risk analyses. Currently he is co-managing a research project for the Danish Strategic Research council entitled: Uncertainties in Transport Project Evaluation (UNITE) that among others contain collaboration with Aalborg University, Oxford University and Princeton University. Recently, he has been co-managing the development of a methodology to prioritise initiatives and projects to promote biking (CPP) and the implementation and use of ITS systems in the Danish road sector for the Danish Road Directorate. Additionally, he has been managing the development of decision-oriented project ranking for the Danish railway asset management system for Rail Net Denmark and involved in the construction of a new transport decision support tool for the Home Rule in Greenland. Finally, he is responsible in an advanced Master and Phd course in Decision Support and Risk Analysis as well as an introductory diploma course in Project Appraisal on Bachelor/Master level.

Dr Vladimir Savin
Chief QA Engineer
EPAM Systems

25 years of research and software development (PL/I OS IBM/360, C/C++ PC), creation and implementation of Industrial Project Management Systems for Nuclear and Thermal Power Plants. For that purpose system development strategy, vision, requirements, design, mathematical models, algorithms, database and software had been developed. I worked as Senior Research Officer, Ph.D. at Belarus Scientific Research Heat Engineering Institute and Belarus State University as Lecturer in IT.

From 1998 I worked at Client-Server Programs Ltd., Galaktika Corporation as Project Manager, at SemiTech as Quality Director, at ScienceSoft as Process Manager, at EPAM Systems as Chief QA Engineer for CMMI, ISO 9001, ISO 27001, SAS70, COBIT implementation and support.  

Dr Hans Schjær-Jacobsen
Copenhagen University College of Engineering

Hans Schjær-Jacobsen is a Professor at the Copenhagen University College of Engineering where he also is a Director of Research, Development, and Innovation. He holds a Master of Science and a PhD degree in Electrical Engineering from the Technical University of Denmark, and also a degree in Business Administration from the Copenhagen Business School. Previously, he held managerial positions with industrial companies as well as institutions for management consulting, training, and education. He also served as a teacher and researcher at different universities and has published a number of scientific papers within the areas of applied mathematics, computer-aided-design of communication systems, and decision making under economic uncertainty.

Jan Van Broeck
Co-founder and International Partner
Threon

Jan Van Broeck is co-founder and CEO of Threon, an European competence center specialized in Project, Program and Portfolio Management. As an expert in the domain of Strategic Portfolio Management, he assists senior management in organization towards successful deployment their strategy. As Past President of the Belux Chapter of the Project Management Institute (period 2004-2005), he actively promotes the profession of “Project, Program & Portfolio Management” in the European region and is a regular speaker in seminars at Universities and business schools. He has occupied several senior management and executive positions in the domain of ICT in different industry sectors. Jan Van Broeck is a PMI certified Project Management Professional, holds a degree in Civil Engineering (construction) from Ghent University and an MBA of the University of Antwerp.

Dr Micha Vered
Managing Director
Eurolapis Ltd

Leading Cooperation EU-Chinese Project – 2009 - present
Risk assessment of synergistic interaction (a countervailing study) between aflatoxin B1 and hepatitis B/C might expose peanut and rapeseed food safety to a serious economic dilemma. The project was aimed at exploring the economic impacts of aflatoxin standards on two world regions, Europe and China.

Management new pharmaceutical compounds - 2007-2010
A novel pharmaceutical approach that strengthening the body’s systems and providing safe, effective and affordable radiation protection drug. The new drug optimized new-generation compounds with potential for clinical development as radioprotection drugs and broad spectrum of medical

In an EU consortium for Food Safety (MoniQa) - 2007-2011
Main activities: 1. Conducting research and study on dairy food, affected from cow environment, quality of feeding, food storage, food toxicity and mycotoxins risk- assessment to livestock and human. 2. Development methods for Livestock and human food analysis

R&D Director and Business Development - 2000-2006
In a business consultants group (for industrial and R&D partners), accrue record and wide experience in Israeli‑European projects in various fields; biotechnology, food industry, agriculture, water technologies environmental protection and ICT.

R&D Director in Pharmaceutical industry (in Israel) - 1987-2000
In three Israeli companies developing new class of synthetic compounds of pharmaceutical and toxicology value. Leading the R&D's investigation on compounds as anti-inflammatory modulators of the immune system, potentially effective in autoimmune and neurological diseases, brain damage (trauma) and stroke
.

Gustavo Vinueza
Consultant and Trainer
Palisade Corporation

Gustavo Vinueza is a Systems Engineer from University in Cuenca, Ecuador. He also earned a MBA from Torcuato Di Tella University in Argentina and a Ms. In Finance from Adolfo Ibáñez University in Chile. His main topics of interest include financial and operational modeling, including scientific and academic research into business practice as well as data mining relative matters. He has 16 years of experience and he’s been a consultant for companies in several industries: finance & banking, telecommunications, insurance and IT related services.

His experience includes managing Project portfolios both operational and IT related, cost reduction programs, public purchases bidding, operational controls, capacity analysis and audit processes and software development projects, besides technological infrastructure implementation. He has also earned diplomas in Project Management, Usability, Business Process Management and Business Analytics.

Dr Chris Walster
Veterinary Surgeon
Island Vet Clinic

Chris Walster qualified as a veterinary surgeon in 1983 and is now the senior partner in an 18 vet small animal practice based in the English Midlands.  He has had a long-standing interest in aquatic veterinary medicine which has led to him working in several areas of the world mainly with ornamental and coarse fish. In 2006 he undertook a Master of Veterinary Public Health (MVPH), which developed an interest in aquatic zoonoses and epidemiology.

Following on from the MVPH he spent a few months at Iowa State University College of Veterinary Medicine developing with other authors the International Veterinary Aquaculture Biosecurity Compendium which has been used at several workshops in Europe, America and Africa to provide training in biosecurity for aquaculture producers through to government regulators.

For the past six years he has been secretary to the World Aquatic Veterinary Medical Association (WAVMA) whose mission is: “to serve the discipline of aquatic veterinary medicine through enhancing aquatic animal health and welfare, public health and seafood safety, to support aquatic veterinarians, aquatic animal owners and industries, and other stakeholders”. This has meant that much of his spare time is spent in the development of aquatic veterinary medical services and promoting the role of the veterinarian in aquaculture production and the food chain.

As well as organising annual meetings for WAVMA, he is a regular speaker at international conferences such as the World Veterinary Congress, the American Veterinary Medical Association Convention, the International Aquaculture Biosecurity Conference and the Aquaculture Insurance Risk Management Conference.

Erik Westwig
Software Engineer
Palisade Corporation

Erik Westwig received his BS in 1991 and MS in 1994 from the applied and engineering physics department at Cornell University. In 1998 he published the book Mathematical Physics with co-author Bruce Kusse, which was re-released in its second edition in 2006. Since 1995, Erik has worked as a software engineer at Palisade as part of the DecisionTools Suite development team.

Marco Wolfrum
Partner and Senior Analyst
FutureValue Group AG

Marco Wolfrum has been working as a management consultant since 1998.
His consulting work focuses in the areas of financial modeling,
Risk management, rating, and (risk-adjusted) valuation.

He is involved in the establishment and development of (stochastic) Financial Models -- especially in Excel (in conjunction with add-ins to perform simulations such as @RISK) - as well as the (statistical) data analysis in the context of risk assessment.

In the area of economic method development, Mr. Wolfrum acts in mathematically oriented research activities of the FVG. His research has appeared in "Risk Measures and Risk Measurement," "Harvard Business Review," and "Risk Performance Management."

He has teaching positions at the HfWU Nuertingen-Geislingen, the Steinbeis University Berlin, and at the Universities of Augsburg and Deggendorf.

Peter Wood
Director
Peter Wood Associated Ltd 

Peter is a director of Peter Wood Associates Ltd, a project management consultancy that specialises in risk-based decision support to capital investment. He has established a reputation for being able to combine subjective analysis and rationalisation of complex problems with probabilistic modelling techniques, to create innovative and robust practical solutions.

Peter is a Chartered Architectural Technologist who developed project management skills during six years with the US Navy Europe. He then joined the engineering consultants WS Atkins, building on project management experience before making the transition to project consultancy, risk analysis and management. His experience includes private and public sector clients in a variety of sectors including rail, infrastructure, construction, defence, utilities, process and nuclear industries.

Alec Yeowell
Asset Management Engineer
Halcrow

Alec is a specialist in physical asset management and has worked on water industry projects for 10 years. He specialises in modelling the behaviour, performance and risk associated with water company assets. After graduating in Civil Engineering in 1999, Alec worked for eight years at WRc Plc delivering water industry focused research projects.

Alec maintains a strong interest in innovation and has been actively involved in Halcrow internal research activities where he has recently been developing spatial optimisation capabilities. The tools have been applied to capital maintenance planning activities to enable clients to meet and improve on agreed performance and spending targets.

Alec is a Chartered Engineer and Member if the Chartered Institute of Water and Environmental Management (CIWEM).