Regional Risk Conference

Best Practices in Risk and Decision Analysis

September 18th, 2014 • Brisbane

Regional Risk Conference

Best Practices in Risk and Decision Analysis

September 18th, 2014, Brisbane

Learn Risk and Decision Analysis from Industry Leaders

Join Fellow Decision Makers and Software Experts in Brisbane

Palisade invites you to an intensive 1-day conference on quantitative risk analysis. This “must attend” event will feature a selection of real-world case studies and software training. Case studies will be presented by industry experts about how they manage risk and uncertainty in a wide range of business applications. Software training on @RISK and the DecisionTools Suite will be given by Palisade staff, and include ideas and applications you can use.

This event is presented free of charge and includes breaks, lunch, and an afternoon networking reception.

Why Attend?

Every decision-maker faces risk and uncertainty, now more than ever. The Palisade Risk Conference provides a unique opportunity to help you deal with risk in tangible, practical ways:

  • Learn how decision-makers in similar situations deal with risk.
  • Apply Monte Carlo simulation and other powerful techniques to your problems.
  • Ask questions of experts in risk analysis and your field – bring your models!
  • Make important connections to stay in touch with after the conference.

And because the event is being offered at no cost, you can’t afford not to attend!

Join A Distinguished Group

More than 1,000 people attend Palisade Risk Conferences every year. For nearly a decade, the Palisade Risk Conferences have been helping managers in many different companies – from Fortune Global 500 to small consulting practices – make better decisions. Here is what just a few participants have recently said:

“Very good conference with good usage of time.”

Mark Mendonca, Program Risk Management, Ernst & Young

“Excellent conference. If there are numbers that vary, you should be here.”

George Chiang, Independent Cost Analyst, Boeing Company

“We saw and discussed methods that directly apply to our problems, and learned to build upon them to come up with solutions.”

Michael Watson, PMP, Senior Staff Integrated Planning, Lockheed Martin

A Global Resource

This 2014 Palisade Risk Conference is part of a global, annual series of meetings where professionals share ideas and advance the practice of risk and decision analysis. With over fifteen events on six continents this year alone, the Palisade Risk Conferences have become a truly global resource for decision-makers.

Information about 2014 Conferences


  General Sessions      
  Software Presentations      
  Industry Case Studies

Thursday 18 September 2014 · Brisbane

Please note the conference schedule may change without notice.


08:00 - 09:00
09:00 - 09:40

Welcome and Overview of Decision Making
Duncan Hickman
Palisade Corporation

09:40 - 10:40
10:40 - 11:00
Morning Break
11:00 - 12:00
12:00 - 01:00
01:00 - 02:00
02:00 - 03:00

Modelling Uncertainty in Project Cost Estimation
Chris Beale

03:00 - 03:30
03:30 - 04:30

Optimisation with Evolver and RISKOptimizer
Rishi Prabhakar
Palisade Corporation

04:30 - 05:00

Duncan Hickman
Palisade Corporation


  Duncan Hickman

Australia and New Zealand Regional Sales Manager
Palisade Corporation

Duncan Hickman is responsible for looking after customers and growing new business for Palisade throughout Australia and New Zealand. Prior to joining Palisade, Duncan consulted on business structure and growth strategies for software products in financial services, sustainability, energy efficiency and the growing carbon trading market. Duncan is an accredited equities and derivatives adviser with several years of experience in the financial services sector, including the establishment and sale of an online financial services company.

  Dr. Stephen Hinchliffe

Principal Strategic Consultant
Jacobs SKM

Dr. Stephen Hinchliffe has Masters Degrees in Engineering, Business Administration and Commercial Law. He is a Fellow of the Institution of Engineers and Technologies (UK), a Chartered Engineer, and a Registered Professional Engineer of Queensland. Stephen has over 20 years’ experience in the power sector. An electrical engineer by profession, Stephen has worked on electricity market reform mechanisms, renewable energy project development, and strategic advisory projects. He has advised the Australian government on policy development in the renewable energy sector and supported the development of a Geothermal Industry Development Framework and Technology Roadmap for the Australian Government. He has recently advised the Indonesian state-owned electricity, oil, gas, and geothermal development company PLN on mechanisms to assist reaching agreement on tariffs for geothermal projects. This included managing a multidisciplinary international team of geoscientists, reservoir engineers, drilling engineers, power plant specialists and financial modellers in reviewing nine geothermal sites in Indonesia with a combined power capacity of close to 1GW and developing Monte-Carlo-based financial models to project required tariff to meet a target internal rate of return.

  Jeremy Kidner

Risk Practitioner

Kidner is a risk practitioner with 36 years’ experience in the police force, corporate sector, and consulting in Hong Kong before coming to Australia in 2009. His specialties include risk analysis, project partnering and change management. Kidner is a Fellow of the Institute of Risk Management (UK), a Master Facilitator, and holds a certificate in advanced risk analysis (simulation and real options analysis). He has lectured in quantitative analysis of risk at the Queensland University of Technology. His experience covers management roles in the public and private sectors in Hong Kong culminating as consultant to the Board of Directors of a publicly listed company in Hong Kong.

  Chris Beale

Functional Manager, Risk Management

Chris has considerable experience in facilitating risk assessments in various contexts, including capital projects, technical designs and feasibility studies. Chris has experience across various industry sectors in the public and private sectors, undertaking qualitative and quantitative risk assessment studies. His skills are focused on project risk management plans, feasibility study risk assessments, design risk, decision support studies, including options analysis, failure investigations and value management.

Chris completed a degree in Mechanical Engineering at Sydney University in 1980 and worked for CSR across Australia and in the UK up until 1990. Chris later joined the Queensland Government in the capacity of industry adviser, major investigations unit team member, and finally as Ministerial Adviser to the Minister for Industrial Relations in the areas of health and safety, and workers’ compensation. On completing his MBA in 1997, Chris started work in the consulting industry and joined SKM in 2003. Chris has now supported over 450 mining, defence, transport, building, environmental, water and industrial projects across Australia and in Chile, New Zealand, Malaysia and India.

  Rishi Prabhakar

Trainer, Consultant
Palisade Corporation

Rishi brings a broad range of experience and expertise to the Palisade team. He has worked in and consulted to the energy industry, telecommunications, scientific research, banking, and finance with an emphasis on operational risk and Basel II. Rishi has expert skills in the areas of statistical analysis, simulation, time series forecasting, risk/capital modelling, extreme value theory, and survey design and analysis. He holds a BSc Mathematics from the University of Technology, Sydney.

  Anuraag Malla

Power Sector - Utility Management & Regulation Consultant
Jacobs SKM

Anuraag Malla provides strategic consulting and advisory services to the power delivery sector, mainly involving electricity utility and associated stakeholders. He works in Jacobs’s ANZ Resources & Power business unit and is based in Sydney, Australia. In this role, he regularly undertakes frontend planning, feasibility studies, forecasting, auditing, regulatory review works, and quantitative modelling including building project financial models. He has successfully delivered a number of consulting and advisory projects requiring multidisciplinary resources as Project Manager. Malla is a member of EngineersAustralia with 11 years’ professional experience. He has a Bachelor Degree in Electrical & Electronics Engineering (BEng) and two Masters Degrees in Business Administration (MBA) and Management (MIM). Recently, he developed and simulated eighteen (nine sites × two sets of capex information) probabilistic models to determine the tariff range for nine geothermal projects in Indonesia. In 2013, he developed and rolled-out a ‘standard’ option appraisal NPV model that includes a tool to conduct sensitivity analysis and its guideline across a NSW electricity utility business. In the past, he has developed/co-developed the financial model for the Cibuni geothermal project in Indonesia and the San Jacinto Tizate Phase 1 geothermal project in Nicaragua.


Welcome and Overview of Decision-Making

Duncan Hickman

We will briefly review goals of this year’s conference and ways you can benefit from the event before giving some context and background about Palisade as a company. We will also explain the added insights that tools like @RISK and the DecisionTools Suite bring to risk and decision analysis. More in-depth exploration of @RISK and DecisionTools Suite will be covered in later sessions.

Next, we’ll switch gears to touch upon the decision-making process itself. Building off a recent feature story in the Harvard Business Review called “Deciding How to Decide,” we’ll examine common bad habits decision-makers often exhibit. We’ll walk through a checklist of things to watch out for that can indicate you actually know less than you think, and when you should be considering a probabilistic approach.

Introduction to @RISK and the DecisionTools Suite: Using Monte Carlo Simulation under Uncertainty

Rishi Prabhakar

This presentation will use examples from different industries and applications for an entry-level introduction to @RISK and the other products in the DecisionTools Suite, to give you an excellent briefing on how to use and get the most from these tools.

The session begins with a tutorial on @RISK, walking you through a trial risk analysis using various example models. Key features of @RISK will be highlighted. 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, and can view your results with a variety of graphing and reporting options. We’ll also point out useful tricks to make risk modeling even easier.

The second half of the session will cover the DecisionTools Suite, an integrated set of programs for risk analysis and decision making under uncertainty. You will learn how the products of the Suite — @RISK, RISKOptimizer, Evolver, PrecisionTree, TopRank, StatTools, and NeuralTools — work together to solve practical problems in the real world. We’ll demonstrate how these tools integrate completely with your Excel program, how to browse, define and analyze your data, and we’ll reveal key tips for using the products together.

  Innovative use of @RISK to determine geothermal feed-in tariff required to meet developer target IRR

Dr. Stephen Hinchliffe and Anuraag Malla
Jacobs SKM

Indonesia has some of the best geothermal resources in the world. However, development has been slow. A principal inhibiter has, until recently, been the financial risk arising from relatively low price offered for the feed-in tariff. This feed-in tariff scheme was established by the Government with an intention to encourage the Independent Power Producers (IPPs) to invest and develop the geothermal sector, but it has not been able to achieve the aim.

Geothermal Tariff Study:
In 2013, Jacobs SKM was engaged by two Indonesian state owned enterprises--PGE, the geothermal development arm of PERTAMINA (Indonesia’s vertically integrated oil and gas company) and PLN, the electricity utility and single off-taker for geothermal energy, to undertake a review of the status of the geothermal developments. The data from this review was then used in a probabilistic model to determine the feed-in tariff required to achieve an agreed internal rate of return (IRR).

To reach the target internal rate of return (IRR), it was necessary to use the financial model and @RISK, using probabilistic variables of CAPEX, OPEX, and various engineering characteristics to determine a range of possible tariff. However, typical models for these problems result in a circular reference, i.e. the requirement to determine an input (i.e. tariff) is based on the output (i.e. 14% IRR), and the output cannot be determined without inputting the tariff value in the model. This situation is further complicated by the fact that the IRR calculation itself is an iterative goal-seeking process.

Jacobs employed an innovative approach of simulating the inputs independently (without direct links to the output), and vice versa. Jacobs developed and used a macro to ‘read’ the simulated 1000 iterations of each input variables and then ‘inserted’ them into the model to ‘indirectly’ determine the situation that meets the required IRR criteria. By using this innovative approach, Jacobs separated the @RISK output from @RISK inputs by isolating the output functions with the help of macro codes, thus enabling the required feed-in tariff probability function that would be required to achieve the target IRR.

Following successful delivery of the project, Jacobs’ clients, PLN and PGE, have now negotiate revised tariffs for each of the nine developments at a level sufficient to give PGE’s required rate of return. This has enabled these low-carbon-footprint energy projects to proceed.

Risk Adjustment and Risk Management of Estimates and Forecasts using @RISK

Jeremy Kidner

RiskIQ uses @RISK to create risk adjusted cost estimates and understands the human and organisational perils that reliable estimates face. Using examples from Defence procurement, utility infrastructure projects and construction projects in Australia and Hong Kong, they will show how to ensure that estimates need to be adjusted for over-optimism and complexity and then the risk properly managed in the organisational context.

Not only is it very difficult to forecast accurately in highly uncertain, complex environments, as human beings we have a set of biases that need to be understood so that the estimate is not over-optimistic and has taken complexity into account. This starts with understanding confidence intervals and ranges of values and progresses to adjusting the estimate for complexity where risk is considered in terms of technical, temporal, structural, directional and organisational risks.

The risk adjusted estimate now faces scrutiny within the organisation where other factors may influence the decision, such as strategy, cash flow, and a range of sensitive issues. RiskIQ will suggest responses which will protect the estimate’s integrity, for example, considering other tools in the Decision Suite to provide flexibility to decision makers and contractual terms to ensure the appropriate allocation of risk.

Modelling Uncertainty in Project Cost Estimation

Chris Beale

The presentation will explore the language of contingency and how @RISK can be used to model the uncertainties in forecasting the final cost of completion for major projects. This will cover not just @RISK but also some of the processes to obtain the input data which is often the most difficult part of the task. Garbage in equals gospel out!

Optimisation with Evolver and RISKOptimizer

Rishi Prabhakar

RISKOptimizer and Evolver use powerful algorithms to perform optimization in Microsoft Excel. RISKOptimizer – an advanced analytical tool that comes with @RISK Industrial – builds on traditional optimization by adding Monte Carlo simulation to account for uncertain (stochastic), uncontrollable factors in your optimization problem. RISKOptimizer and Evolver 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 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. These steps will be illustrated by means of a detailed retirement portfolio optimization example.

Sofitel Central Brisbane

The Palisade Risk Conference will be held at the luxurious Sofitel in Central Brisbane, with the convenient location above Central Train Station. The Airtrain is available approximately every 20 minutes to and from Brisbane Domestic and International Airports, with travel time of just 22 minutes.

Address: Sofitel Brisbane Central, 249 Turbot St, Brisbane QLD 4000
Phone: +61 7 3835 4444
Website: Sofitel Brisbane

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