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In This Issue
What’s New
» Inaugural Academic

» New 3 day training schedule
» Palisade at ADIPEC
Middle East Oil & Gas show
ISA uses @RISK for
   Investment Analysis

@RISK Modelling Tips
» PrecisionTree and @RISK:
   Oil Drilling

» Random Trend and
   Random Walk

@RISK Function
of the Month

» The Triangular Distribution

Palisade Analytics
in the Press

» Auto Racing
» Climate Change
» Corporate Partnering
» Drug Testing
» Environmental Policy
» Government Contracting
» Law
» Public Works
» Robotics
» Social Security
» Space Science

» Palisade User Forums

Palisade Risk & Decision Analysis Conferences
» Latinoamérica
20-21 octubre, Medellín
» North America
13-14 Nov, New York City
» Asia-Pacific
Spring 2009, Melbourne
» Europe
Fall 2009

to chat live
with a sales

DecisionTools Suite 5.0 World Tour
Special live demonstrations of the all-new DecisionTools Suite 5.0. Learn how the Suite products combine to deliver more complete results than any single product can provide.

Aberdeen, 23 September

Manchester, 24 September

Baltimore, 10 October
Washington DC, 15 October
Irvine, CA, 15 October
Download LA, 16 October
Orlando, 28 October

St. Louis, 29 October
Chicago, 30 October

» Sign up for a Tour date

Palisade Energy Risk Analysis Forum
A one-day forum covering risk and decision analysis from all angles specific to the energy sector.

Calgary, AB, 25 September

» Register Now for the Energy Forum

Regional Seminars
» Africa
Pretoria: 1-2 Oct

» Brasil (em português)
Salvador: 9-10 outubro
Rio de Janeiro: 24-28 nov

» Europe
London: 15-17 Oct
Oslo: 28-29 Oct
London: 5-7 Nov
London: 4-5 Dec

» Latinoamérica
   (en español)
Bogotá, Colombia:
   24-28 de noviembre

» North America
Boston: 23-24 Sept
Chicago: 29-30 Sept
Toronto: 1-2 Oct
Baltimore: 8-9 Oct
Manhattan Beach: 16 Oct
Calgary: 21-22 Oct
Orlando: 29-30 Oct
Los Angeles: 20-21 Nov
Dallas: 3-4 Dec
Atlanta: 16-17 Dec

Live Web Training
» Project Risk Assessment Using @RISK for Project
2-3 September, 1-5pm ET

» Risk and Decision Assessment Training using @RISK 5.0
Part I
13-14 Oct, 1-5pm ET
3-4 Nov, 1-5pm ET
8-9 Dec, 1-5pm ET
Part II
16-17 Oct, 1-5pm ET
6-7 Nov, 1-5pm ET
11-12 Dec, 1-5pm ET

Free Trial Versions
Palisade software is available in fully functional free trial versions. Try @RISK or any of our software today!

The DecisionTools Suite
The complete risk and decision analysis toolkit

The world's most widely used risk analysis tool
@RISK» @RISK for Excel
@RISK» @RISK for Project
@RISK» @RISK for Six Sigma

Visual decision analysis for spreadsheets

Sophisticated neural networks for spreadsheets

Advanced statistical analysis for spreadsheets

The Innovative Optimiser
for Windows

The DecisionTools Suite

Palisade Academic Symposia - e-focus

What's New
Autumn 2008 sees the launch of Palisade’s
inaugural Academic Symposium Series
Palisade is pleased to announce an exciting new concept—the Academic Symposium. Currently more than 40,000 students are trained annually on performing quantitative risk and decision analysis using @RISK and the DecisionTools Suite, and the purpose of the Symposia is to bring Professors, lecturers and graduates together to examine some of the applications of the software in industry, to share their experiences of teaching and learning, and to demonstrate how easily @RISK and The DecisionTools Suite can add an extra dimension to academic syllabi.

Pretoria, 30 September
Frankfurt, 18 October

» Free registration

New three day training schedule
We are now expanding our renowned training seminars to reflect the increased popularity of the DecisionTools Suite. @RISK will continue to be trained over two days, but customers will now have the opportunity of attending a third day which focuses on the other products in DTS. Day 3 can also be attended as a stand-alone training course – although prior knowledge of using @RISK is recommended. The global economy may be facing an unpredictable future but using tools such as TopRank, Evolver and PrecisionTree can help you to effectively plan and mitigate for any uncertainty.

» Dates and registration

Palisade at ADIPEC – Middle East Oil & Gas show
November sees the return of one of the largest oil & gas shows in the world and Palisade will be one of this year’s exhibitors. You can find us on stand H10/20-13 in the US Pavillion, where we’ll be doing live demonstrations of @RISK and The DecisionTools Suite, answering any questions, and meeting with prospective partners. If you’re at the show, please come along and say hello to us—even if it’s just to pick up the obligatory free pen as a souvenir.

» ADIPEC 2008

Colombian Energy Giant ISA uses @RISK
for Investment Analysis
Palisade’s successful expansion into Latin America is exemplified by Colombian energy transport company ISA’s (Interconexión Eléctrica S.A.) use of @RISK for corporate wide financial analysis and forecasting. The giant utility consists of 10 component enterprises which offer energy and telecommunications transmission throughout Central and South America. ISA’s individual investments and projects are often valued with the most rigorous strategic and financial plans, and the ISA financial team’s goal is to produce detailed, integrated models to simulate the potential performance of these investments and determine the optimum use of its financial resources.

Diagnosis of the Corporate Portfolio
Rather than assess each potential investment or project in isolation, the ISA financial team looks at the effect that transaction will have on the entire portfolio of ISA investments. @RISK is used to account for factors that occur irregularly throughout the portfolio. What if the exchange rate shifts in one of the countries involved in an ISA investment but not in the others? Or perhaps potential revenues vary widely across the group’s region.

» Read the full Case Study
» Grupo ISA is presenting at the Palisade Risk & Decision Analysis Conference
   Latin America. Click here for more (in Spanish) and see below.

Product Spotlight

PrecisionTree 5.0
and @RISK 5.0: Oil Drilling

The results of finding oil in the oil drilling decision tree Oil.xls are divided into three discrete outcomes - Dry, Wet and Soaking. But, in reality, the uncertain amount of oil found should be described with a continuous distribution. @RISK is used in this model to describe the uncertainty of this chance event. By adding @RISK probability distribution functions to decision trees, you gain more accurate modelling and can simulate more possible outcomes.

» Download example model: OilSimulationWithRISK.xls

Projecting Interest Rates and Other Trends: Random Trend and Random Walk
In this example, distribution functions are used to model uncertain trends. Both a simple random trend and a random walk are illustrated. For each iteration, a new value is sampled for each period in a trend. This allows your results to include the effects of all possible trend values as opposed to a single set of best estimates. In the random trend there is no correlation between periods. In the random walk, the value in each period is influenced by the value of the previous period.

» Download example model: Rate.xls

Product Spotlight

The release of @RISK 5.0 has spurred tremendous response from our users. Every day customers ask us, “What’s new in @RISK 5.0?” To help answer this question, this series highlights key new features in @RISK 5.0. You can always see a complete list of new features, including short 30-second movies, here:

» What's New in @RISK 5.0

The RiskMakeInput Function
The RiskMakeInput function turns any Excel formula into a @RISK simulation input, even if it does not contain a probability distribution. Use this to get @RISK to treat your proprietary calculations just as it does its own probability distributions when calculating simulation results. RiskMakeInput can also summarise many individual probability distributions into a single input, simplifying your Tornado graphs.

» See how RiskMakeInput works

Function of the Month

The Triangular Distribution

This distribution is perhaps the most readily understandable and pragmatic distribution for basic risk models. It has a number of desirable properties, including a simple set of parameters including the use of a modal value i.e. a most likely case. There are two main disadvantages of a Triangular distribution. First, when the parameters result in a skewed distribution, then there may be an over-emphasis of the outcomes in the direction of the skew. Second, the distribution is bounded on both sides, whereas many real-life processes are bounded on one side but unbounded on the other.

RiskTriang(minimum,most likely,maximum) specifies a triangular distribution with three points — a minimum, most likely, and maximum. The direction of the "skew" of the triangular distribution is set by the size of the most likely value relative to the minimum and the maximum.


RiskTriang(100,200,30) specifies a triangular distribution with a minimum value of 100, a most likely value of 200 and a maximum value of 300.

RiskTriang(A10/90,B10,500) specifies a triangular distribution with a minimum value equaling the value in cell A10 divided by 90, a most likely value taken from cell B10 and a maximum value of 500.

Palisade Software Techniques in the News

Auto Racing
Carbon Footprint of Formula One Cars
Technique: Statistical analysis, sensitivity analysis   » see DecisionTools Suite
Source: Bleacher Report, August 25, 2008

Race fan and columnist Long John Silver launches a three-part investigation of how much carbon dioxide Formula One cars produce on an average race day.

Climate Change
Human-Caused Changes in Winds Result in Drier, Warmer Springs
Technique: Monte Carlo simulation   » see @RISK 5.0
Source:, August 4, 2008

Researchers from the University of Arizona used Monte Carlo simulation to determine that changes in storm tracks were due to human activities.

Corporate Partnering
IBM Publishes Principles of Engagement for Sales
Technique: Decision trees   » see PrecisionTree 5.0
Source: eChannelLine, August 26, 2008

IBM’s guidance to staff on selling to corporate partners comes in the form of a decision tree.

Drug Testing
Cost-Effectiveness of Clopidogrel during Coronary Intervention
Technique: Decision trees, risk analysis   » see DecisionTools Suite 5.0
Source: RedOrbit, August 29, 2008

A combined decision tree and Markov model helped researchers weigh the costs and benefits of a drug often used during coronary interventions.

Environmental Policy
Climate Data Available, But Report Cites Need for Wider Use of Computer Power
Technique: Decision analysis   » see DecisionTools Suite 5.0
Source: MarketWatch, September 8, 2008

A new report from NASA highlights the need to expand the use of decision support tools to inform environmental policies.

Government Contracting
Dilemma for Boeing as Pentagon Issues New Tanker Specs
Technique: Monte Carlo simulation   » see @RISK 5.0
Source: Aviation International News, August 22, 2008

When the government issued a revised RFP for a new tanker aircraft, Boeing used Monte Carlo simulation to make its case persuasively.

Settlement Counsel: A New Player in Resolving Tough Issues
Technique: Decision analysis   » see DecisionTools Suite 5.0
Source: Lawyers Weekly, September 12, 2008

As the role of so-called “settlement counsel” has grown, these intermediaries have turned frequently to risk analysis and decision trees.

Public Works
Evidence from Risk Assessment on New Rec Facility
Technique: Decision trees, risk analysis   » see DecisionTools Suite 5.0
Source: Orillia Today (Ontario, Canada), August 20, 2008

Evidence from decision tree and risk assessment analyses are likely to dissuade one town’s public officials from approving construction of a multiuse recreational facility.

Intel's Building Blocks for Shape-Shifting Robots
Technique: Neural networks   » see NeuralTools 5.0
Source: The Register (London), August 21, 2008

As part of a futuristic demonstration of programmable intelligence, Intel showed off tiny micro-robots that use a neural network to form self-programming objects that can reshape themselves.

The Mirror Image?
Technique: Neural networks   » see NeuralTools 5.0
Source: Times of India, August 22, 2008

A new robot developed at Meiji University in Japan uses a neural network to distinguish between its own image in a mirror and an identical robot mimicking it.

Social Security
New CBO Projections of Social Security Financing
Technique: Monte Carlo simulation   » see @RISK 5.0
Source: American Enterprise Institute, August 22, 2008

The Congressional Budget Office used Monte Carlo simulation to arrive at projections of Social Security financing that differed from the predictions of the Social Security Administration.

Space Science
Controlling Spacecraft
Technique: Monte Carlo simulation with optimisation  » see RISKOptimizer 5.0
Source: The Engineer (London), September 2, 2008

A team of engineers used Monte Carlo simulation to improve fault tolerance and recovery in unmanned missions launched by the European Space Agency.


Palisade User Forums

The Palisade User Forums are online discussion boards where users are invited to post questions and share ideas on their use of @RISK and other Palisade software. It’s also a great place to check for announcements regarding updates of Palisade software. Forums are organised by products.

» Join or view the Palisade Forums

Recent topics include:

» Adapting @RISK Shifts to Excel Probabilities


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