Regular feature in Oil & Gas Monitor, by Palisade's Rafael Hartke
Rafael Hartke, Oil and Energy Industry Consultant at Palisade Corporation, writes a regular column in Oil & Gas Monitor, exploring the use of risk analysis in the oil and gas industry.
• Practical Challenges of Implementing Risk Analysis in Oil Companies, March 13, 2013
• Application and Benefits of Risk Analysis for Decision Making in the Oil Industry, April 5, 2013
• Decision Trees and the Value of Flexibility, May 17, 2013
• Decision Trees and the Value of Flexibility II August 2, 2013
• Risk Analysis and Risk Production Curves, November 1, 2013
The game of risk: metals companies’ slow embrace of ERP
by Gregory DL Morris, American Metal Market, June 26, 2013
Although some steelmakers have been slow to embrace some of the enterprise resource planning (ERP) software systems, others have had success with them. A mill in the United Kingdom recently employed a latest-generation risk-management system to plan and execute a plantwide maintenance turn. One of their largest blast furnaces in Europe had suffered cost and schedule overruns on previous maintenance turns. This time the mill hired a management firm that used @RISK to identify key risks and forecast throughput at the business sites incorporating those risks. The project was a major success and was even completed ahead of schedule.
Solar Industry in Serious Trouble
by Gregory DL Morris, Risk & Insurance, April 2, 2013
Det Norske Veritas (DNV) is a global consultancy that evaluates the technical viability of solar and other renewable energy projects. In its evaluations DNV has developed proprietary systems, but also relies heavily on @RISK. According to Davion Hill, principal engineer with DNV, a higher level of risk analyses, including Monte Carlo simulation, are extremely important for solar projects because they have to be integrated with other sources of power. Whether solar power is being consumed on site, fed to a grid, or stored, the cycling has everything to do with the operating ratio of each source.
Simulation City: Simulation software can improve decision making - and the manufacturing process.
by Michelle Bangert, Quality Magazine, 7 August 2013
Monte Carlo simulations, named for the city in Monaco, were developed during the 1940s with the Manhattan Project. But today’s simulation software can be used for a range of industries and applications to help people make decisions about their products and processes. Dr. Eric Maass, co-author of the book "Applying Design for Six Sigma to Software and Hardware Systems," explains that a lot of people don’t realize what they are missing out on by not using simulation software. By running simulations, they can take the guesswork out of applications. In addition, simulation modeling allows everyone involved in the process, from operators on the shop floor to those in management, to visually understand a system.
Are There Red Flags in Green Construction?
by Joe Mullich, The Wall Street Journal, 23 September 2013
As green options move toward becoming the norm, new risks can result, such as whether environmentally-friendly materials can withstand a major earthquake, hurricane or flood. Green builders are turning to Monte Carlo simulation, a computational model that examines all possible outcomes and identifies the probabilities of different scenarios happening. According to Randy Heffernan, Palisade's vice-president, “Managers employ the technique to account for budgetary risk, cost risk, schedule risk and more. When you bring in elements such as new and often more expensive building materials or building features that are more weather-dependent—like solar and green roofs—the uncertainty of the entire project is compounded.”
Hydropower Gets Small to Grow
by Gregory DL Morris, Risk & Insurance, 22 July 2013
While momentum of hydropower legislation continues to build on Capitol Hill, companies such as BC Hydro are using @RISK to communicate complex analyses, and have been able to set very aggressive energy conservation goals. According to Basil Stumborg, a decision analysis expert for BC Hydro, “There is a huge incentive for utilities such as BC Hydro to encourage energy conservation. But while the motivation is there, it is often difficult to know whether these ambitious targets can be achieved.”
Consolidation Needed - Solar panel bankruptcies are challenging risk managers in the field.
by Gregory DL Morris, Risk & Insurance, 1 May 2013
A recurring problem in solar energy is the long-term viability of the companies that make the panels and issue long warranties for their performance. Det Norske Veritas is a global consultancy that evaluates the technical viability of solar and other renewable energy projects. DNV analyses show there is usually a 5 percent to 10 percent drop in a panel's power output in the first 12 to 18 months, and then it levels off to a degradation of just about 1 percent per year for the life of the panel. In its evaluations, DNV has developed proprietary systems, but also relies heavily on commercial risk-simulation software such as @RISK.
Monte Carlo Simulation and Human Risk
by Randy Heffernan, Risk Management, 4 March 2013
The article explores 3 examples of Monte Carlo simulation technology applied for non-business uses: Hurricane Katrina call center, Guatamala volcano evaluation, and pandemic preparation.
Using Technology to Navigate Risk
by Randy Heffernan, Executive Insight, 12 December 2012
For many healthcare providers, risk analysis technology, which utilizes a computational method called Monte Carlo simulation, has proven to be a valuable asset in understanding risk factors and making crucial decisions that address real-world healthcare concerns, such as determining optimal staffing, patient capacity and facility expansion.
New ERM software programs offer increased speed and usability
by Bill Kenealy, Business Insurance, 23 September 2012
In light of evolving demands from customers, makers of enterprise risk management software programs are reworking their offerings with an emphasis on increased speed and usability. Randy Heffernan, vice president of Palisade, is quoted in the article.
» Read the article on Business Insurance (login required)
» PDF of Business Insurance article
Risk Analysis Will Drive Better Decisions Across the Supply Chain
by Randy Heffernan, Supply Chain Digital, 8 August 2012
The lack of extensive risk analysis performed in the supply chain will continue to be detrimental to efficiency. As supply chains expand globally, their risk of disruption also grows. Catastrophic events, such as the Japanese earthquake and Hurricane Katrina, have highlighted the need for analysis of disruption risk and development of mitigation plans to cope with that risk.
Knowledge Is Power: Embracing Risk Analysis
by Randy Heffernan, E-Commerce Times, 14 July 2012
How do businesses eliminate risk? The simple answer is this: They can't. It is impossible. Understand the nature of risk factors, and plan strategies accordingly. Create an environment in which the reality of risk is communicated, and employ the latest technological advances to forecast risk in order to improve the company's "risk health."
Knowledge (of the Unforeseen) is Power: The Necessity of Risk Analysis in Enterprise
by Randy Heffernan, Actuarial Post, July 2012
Increased use of risk analysis in the form of quantitative risk management (QRM) and decision-making under uncertainty (DMUU) is helping organizations to be prepared for unforeseen risk.
Monte Carlo Simulation Means Quantifying Logistics Risks Doesn't Have to Be a Gamble
by Fernando Hernandez, SupplyChainBrain magazine, July 3, 2012
The expansion of global supply chains has meant an exponential growth of the risk of disruptions to those networks. Organizations around the world are turning their eyes away from decision making processes based on single-point estimates, and viewing their risks and opportunities with more sophisticated techniques such as Monte Carlo simulation.
Assessing the Risk of Cleantech Projects
Alternative Energy eMagazine, June/July 2012
Alternative Energy eMagazine interviewed Randy Heffernan, Vice President of Palisade, about risk analysis in the energy industry. The article highlights FutureMetrics’ use of @RISK to hedge wood prices in the production of burning wood pellets.
Measuring and Mitigating Risk
by Stephen Johnson, Baseline, 5 June 2012
Community services provider Arc of Yates utilizes simulation program to predict potential budget shortfalls
South African firm uses risk analysis software for ‘unbankable’ projects
The Actuary, 13 March 2012
A South African infrastructure development company has used @RISK risk analysis software to ensure it attracts funding for projects to deliver basic community services that would otherwise be ‘unbankable’.
Managing Mother Nature: Planning for Extreme Weather Events
by Randy Heffernan, Banking New York, March, 2012
Taken separately, the most severe natural events are unlikely to occur. However, Mother Nature can take many forms, and her wrath is notoriously difficult to predict accurately, even with the best practices and software tools used by meteorologists. It is that unpredictability that makes such events so destructive.
Mixing business with biofuels
by Scott Mongeau, Energy & Environmental Management, February 9, 2012
Using risk analysis software such as Palisade’s DecisionTools Suite enables the development of profitable business cases for sustainable energy projects. A biofuel plant provides a good example, although the principles are equally applicable to sustainable energy initiatives such as wind or solar energy.
When Calculating Risk for Reinsurers, Consider Monte Carlo
by Randy Heffernan, PropertyCasualty360, 19 January 2012
In the world of reinsurance, accurately determining risk is critical. The application of Monte Carlo simulation is being considered more often in order to better prepare a variety of industries for a range of events.
Risk Management Trends: 2011 and 2012
by Randy Heffernan, Enterprise Systems Journal, January 16, 2012
Risk is not an exact science, but there are specific trends that should impact decision makers in the year to come.
Optimising the Business Case for Sustainable Energy Projects: Sark7 provides due diligence for prospective investors using the DecisionTools Suite
Environment Industry Magazine, December 2011
This case study takes a biofuel plant as an example where @RISK models the project's Net Present Value (NPV), PrecisionTree informs strategic scenario decision-making, and Evolver suggests plant optimisation strategies.
Predictive policing: the smarter way to prevent crime?
by Craig Ferri, Contingency Today, 1 December 2011
The riots in the UK this summer prompted discussions on the trade-offs between adequate policing and budget cuts. Palisade's Craig Ferri asks whether it is possible to learn from how other sectors predict risk to find better, more cost-effective ways to control crime. (free registration necessary to view the article)
Why software companies must analyze risk to ensure success
by Randy Heffernan, ZDNet, October 14, 2011
In this byline, Randy Heffernan, vice president of Palisade Corporation, outlines risk management best practices to ensure the success of software projects and shares tips for crafting effective risk management strategies. He discusses how to effectively calculate and manage risk and explains the significance of the concept of probabilities.
Enterprise Risk Management Software Gaining Popularity
by Pam Baker, CIO Update, October 5, 2011
In this article, Randy Heffernan, vice president of Palisade Corporation is quoted on the emerging risk management software market. The article discusses the appeal of risk management software to large enterprises and talks about the current state of risk management market and its possible future.
The growing trend of Monte Carlo simulation for reinsurance
by Randy Heffernan, Actuarial Post, October 2011
The reinsurance industry has endured numerous larger than expected losses in the last decade or so -- everything from Hurricane Katrina to the global financial crisis to the Japanese earthquakes. Perhaps spurred by these losses, the world of reinsurance is looking at different ways of thinking about risk and how to manage it.
Black Swans and Silver Linings
by Craig Ferri, Risk UK, October 2010
Palisade Europe Managing Director Craig Ferri provides a list of guidelines for implementing Quantitative Risk Management (QRM) and Decision Making under Uncertainty (DMU).
Q&A on risk assessment and analysis
by James Powell, Enterprise Systems, September 19, 2011
Given the state of the current global economy, there's been a lot of talk about the need for "proper risk analysis." The concept of risk analysis and management has been around for many years but still is not executed well within the software industry. For any risk analysis assessment to be meaningful, it must take into account the concept of probabilities -- still a relatively foreign concept to many decision-makers. Q&A with Randy Heffernan, vice president of Palisade Corporation, discussing some of the most common reasons for the failure of risk management initiatives that can be applied to ensure the success of software projects.
Risk managers deserve a higher profile
by Craig Ferri, Risk Management Professional, September 2010
Palisade Europe Managing Director Craig Ferri explains how 'Black Swan' events are changing perceptions of risk analysis.
Brave New Austerity World
by Craig Ferri, BSC: The Chartered Institute for IT, September 2010
Palisade Europe Managing Director Craig Ferri explains why it is so crucial that risk managers have a higher profile.
Why Risk Managers Need a Higher Profile
by Craig Ferri, Strategic Risk, July 20, 2010
Palisade Europe Managing Director Craig Ferri explains why now is the perfect opportunity for risk managers to play a more important role in companies than ever before.
Undervaluing the Need for Risk Management is Risky
by Lora Bentley, IT Business Edge, March 3, 2009
Yale University behavioral economists professor Robert Shiller recently identified the cause of the financial crisis, stating: "The real problem is that we weren’t managing risk." But risk management is more than panic: it's also good business. Once companies begin to better manage risks, other corporations that wish to retain competitive advantage will follow suit.
Analysis Placebos: The Difference Between Perceived and Real Benefits of Risk Analysis and Decision Models
by Douglas Hubbard and Douglas Samuelson, Analytics magazine, Fall 2009
The authors examine decision analysis methods that merely make people feel better about their decisions with those that produce measurable improvements over time. They find that Monte Carlo simulation is one of the most effective methods for decision and risk analysis.
by Kate Plourd, CFO Magazine, January 1, 2009
This article cites a survey of 125 CFOs in which nearly 75 percent of respondents said risk management now outranks key issues such as debt financing, relationships with banks, pension-plan asset allocation, and equity financing.
Palisade - Quantifying Risk
Digital Energy Journal, June/July 2008
@RISK is used to assess the relative benefits of different drilling strategies for Lundin, a small exploration company, for field development.
More Than a Roll of the Dice
by Alex Forrest, MiningNewsPremium.net, 10 January 2008
A MINING project's viability ultimately hinges on minimising risk. While doing this may not be as simple as analysing your chances at the tables in Vegas, the software available to help mining companies assess their project risk is becoming increasingly advanced. Alex Forrest looks at a leading risk management software provider.
Academics Tackle Epidemics
by David Robson, Scientific Computing World, August/September 2007
A discussion of how modelling software is having an impact on monitoring the spread of global diseases. An example using @RISK to combat avian flu is included.
Neural Network Analysis Speeds Disease Risk Predictions
by Ninad Patil, M.D., M.S. and Timothy J. Smith, R.Ph., Ph.D.,Scientific Computing, July 2007, pps 36-38
Researchers at the University of the Pacific’s Thomas J. Long School of Pharmacy and Health Sciences used Palisade’s NeuralTools to assist in the evaluation of both the impact of pathological processes and their implications for drug therapy.
Quantity and Quality
by Nicholas Pratt, Banking and Technology, 1 July 2006
Palisade's Dr. Michael Rees discusses credit risk assessment in banking.
Neural Networks Software Crunches the Big Numbers
by Mirek Janusz, Quality Digest, February 2006
Palisade's Mirek Janusz provides a summary of the methodology and applications of neural networks software, including Palisade's NeuralTools.
'Exotic' Programming Tools Go Mainstream
by Peter Coffee, eWEEK, February 2006
I was looking for a software tool that was easy to use and would do forecasting based on complex parameters,’ said independent health care consultant Barb Tawney, who described to eWEEK Labs her use of NeuralTools from Palisade.
» Read summary case study.
Capital Budgeting: IT Project Portfolio Optimization Redux
by Marcia Gulesian, Developer.com, 2006
This is the second in a series of articles that examines decision-making methods for the selection or rejection of individual projects throughout the project portfolio management process. These methods determine whether or not a given project (either proposed or in process) should be included in your next capital budget. The article features RISKOptimizer and @RISK for optimization under uncertainty.
Rational Outsourcing Decision in VoIP Projects
by Marcia Gulesian, Developer.com, 2006
According to a recent Harvard Business School study, higher IT capability directly correlates with superior revenue growth. Nearly all IT managers (at more than 150 large enterprises) surveyed for the study said they plan to increase outsourcing, particularly in the areas of application development and IT infrastructure. This article features PrecisionTree to evaluate outsourcing decisions.
Capital Budgeting: Managing Efficient IT Project Portfolios
by Marcia Gulesian, Developer.com, 2006
This is the first in a series of articles that will examine some of the most commonly used decision-making methods for the selection or rejection of individual projects throughout the project portfolio management process. These methods determine whether or not a given project (either proposed or in process) should be included in your next capital budget. The article features Evolver for optimization.
Business Continuity Ask The Experts -
Interview with Palisade's Craig Ferri
Business Continuity, 23 November 2005
Palisade Europe Managing Director Craig Ferri answers questions about business continuity risk in the Ask The Experts column.
If You Build It, Will They Come?
by Lauren Barack, On Wall Street, June 2005
In this article, @RISK is used to illustrate how to plan for retirement more accurately using Monte Carlo simulation.
» Download sample model and graph referenced in this article.
Mortgage Lending Risk Analysis
by Dr. Michael Rees of Palisade Corp, Risk Magazine, 2004,
Palisade's Dr. Michael Rees demonstrates a practical example of how, using @RISK, it's possible to analyze house lending.
Using @RISK to Calculate Portfolio Performance
by George Birbilis and Gautam Mitra, CARISMA Centre for the Analysis of Risk and Optimisation Modelling Applications, Brunel University, UK, Risk International Yearbook 2003, 15 August 2003
This article demonstrates how a simulation approach using @RISK can be used as a simple but effective financial planning tool.
Applying Risk Analysis to Play-Balance Role-Playing Games
by Alan Carpenter, June 11, 2003
@RISK is used to achieve "play balance" - that is, making sure a game is neither too hard nor too easy - for sophisticated interactive role-playing video games.
Project Portfolio Management at Novartis Pharma
A Case Study from London Business School using @RISK, PrecisionTree, and RISKOptimizer
A Better Way to Size Up Your Nest Egg: Monte Carlo Models Simulate
All Kinds of Scenarios,
BusinessWeek, January 22, 2001
Using Monte Carlo Simulation for Pavement Cost Analysis
Public Roads Magazine, November/December 2000
Why Plain Old Spreadsheets Are Not Enough (RISKOptimizer)
PCWeek, March 1999
Palisade Takes Add-In Science to New Heights (@RISK,
Derivatives Strategy, August 1996
Modeling a European Put Option (@RISK)
Sam O. Sugiyama & Jeffrey Chow
Operational Research Software (BestFit)
European Journal of Operational Research