Students Solve Probabilistic Problems in Construction Productivity at Northeastern University

Students Solve Probabilistic Problems
in Construction Productivity at
Northeastern University
Professor Ali Touran of Northeastern University in Boston has been using @RISK for over 20 years. In the early 1990s, he prepared the first risk assessment manual for the US Federal Transit Administration, using @RISK.

In the Civil and Environmental Engineering Department at Northeastern, Dr. Touran has focused on Construction Management and equipment methods and modeling for the last 25 years, with an emphasis on Construction Cost and Schedule Uncertainty using probabilistic methods. @RISK has played an important part in teaching risk analysis to his students.

“Many probabilistic problems are very difficult to resolve analytically to the point that it frustrates the students,” says Dr. Touran. “Simulation is a powerful tool that allows them to see an example of the outcome while being aware that they have to be careful with the interpretation of results."

@RISK’s Monte Carlo simulation capability helps students to understand complex risk analysis and decision making. Approximately 100 students at both the undergraduate and graduate level take Dr. Touran’s courses each year.

These days Professor Touran spends most of his time on research projects and papers. He reports that many of the graduate students at Northeastern use @RISK analysis to support their dissertation or thesis work.

» More about Prof. Touran, his courses, and publications

@RISK @RISK does its work without involving you
      in its computational complexities. So students
      who may have been scared of stats and data
      analysis before can feel perfectly at ease
      creating their simulations — and so, they
      want to do more. Trial Versions

                             Dr. Domingo Castelo Joaquin,
                             Illinois State University College of Business

Recent School Adoptions

Over 60,000 students use the DecisionTools Suite annually in their MBA and graduate level programs. In 2011, over 800 universities worldwide adopted the DecisionTools Suite. Professors in business, engineering, OR, and other fields keep their students on the cutting edge by teaching the latest analytical techniques from Palisade. Some major schools with programs and courses that standardized on the DecisionTools Suite last month include:

US and Canada:

  Bradley University
Cornell University
Embry-Riddle Aeronautical University
Harvard School of Public Health
Indiana University
Louisiana State University
Michigan State University
Texas A&M University
University of Colorado, Denver
University of Texas, Austin
University of Virginia
University of Washington


  CASS Business School - United Kingdom
Fachhochschule Vorarlberg - Austria
Indian School of Business - India
INSEAD - France
Pontifica Universidad Catolica del Peru
Saudi Aramco Upstream Professional
  Development Center - Saudi Arabia
Technische Universitaet Braunschweig – Germany
Universidad de Talca - Chile
Universidad Politecnica de Madrid - Spain
Universidade de Coimbra - FE - Portugal
University of Pretoria - South Africa
University of Trinidad & Tobago
ZHAW Zürcher Hochschule f.
  Angew.Wissensch. - Switzerland

Licensing Options

There are three easy ways to get the DecisionTools Suite for your students:


Course Licenses available from Palisade. These are economical, annually renewing bulk licenses for both
network lab and laptop installation.
» Learn more

Student Versions from Palisade. These are 12-month versions available for purchase individually by students through either the Palisade web site or the school store.
» Learn more

Textbook Editions available bundled with textbooks.
These are time- and model-limited licenses.
» Learn more

Get DecisionTools Suite 5.7 for your course by contacting:

AddressPalisade Academic Sales    
800-432-7475 / 607-277-8000

@RISK We have been using @RISK in core MBA
      teaching and electives since 1994. The
     @RISK sessions have been very popular
      with our students and helped us
      communicate better important concepts
     about risk and return. The software is
     user-friendly and well integrated into
     spreadsheets, which makes it very easy for
     students to start using it with minimal
     advance training. It also provides a range
     of advanced features, such as sensitivity
     and scenario analysis, tornado diagrams
     and parametric analysis that are appealing
     to managers with a need for sophisticated
     risk analysis. Many students use @RISK in
     their project work and, after they complete
     the MBA programme, in their working
     environment. We believe that tools such
     as @RISK are becoming essential for
     modern managers.Trial Versions

                       Kiriakos Vlahos, Assistant Professor
                       Decision Sciences, London Business School

Teaching Tips & Examples

The DecisionTools Suite is a great way to present quantitative techniques in a straightforward, easy-to-understand way. Each month we feature an example or tip illustrating how students can gain "real world" benefits by implementing quantitative analysis.

Scheduling Trains to Station Stops
Excerpted from Evolver Solutions for Business by Roy Nersesian, published by Palisade

Suppose that 2,500 commuters are expected to show up during the evening rush at a metropolitan train station. Five trains have departure times that fall within this period of peak demand. The trains are to be scheduled to stop at ten stations. Management wants to concentrate on having as many “express” trains as possible for the commuters as few passengers are expected to get on the trains once they leave the metropolitan station. Customer satisfaction during the rush hour is accomplished by minimizing the number of stops while still providing adequate service to each station. Adequate service is defined as having a sufficient number of trains stopping at each station to handle the anticipated number of passengers while minimizing the need for passengers to stand from overcrowding. What is the train schedule that minimizes the number of stops for each train while providing an adequate level of service?

Palisade Download the example spreadsheet and
    step-by-step instructions

Tech Tip of the Month

Using the RISKCompound
Function to Evaluate Risk

Q. I have a risk that may or may not occur, or it might occur a variable number of times. But the impact or severity of each occurrence is a probability distribution, not a fixed number. How can I model this in @RISK?

A. The RiskCompound function, new in @RISK 5.0, is the solution. It takes two arguments: a discrete function for frequency or probability, and a discrete or continuous function to govern severity or impact.

Suppose the impact or severity is according to RiskNormal(100,10). If you want to say that the risk may or may not occur, and has 40% probability of occurrence, code it this way:

=RiskCompound(RiskBinomial(1,0.4), RiskNormal(100,10))

If you want to say that the risk could occur a variable number of times, choose your discrete distribution for frequency. For example, if you chose a Poisson distribution with mean 1.4 for the distribution of possible frequencies, then your complete RiskCompound function would be

=RiskCompound(RiskPoisson(1.4), RiskNormal(100,10))

In any iteration where the frequency is greater than 1, @RISK will draw multiple random numbers from the severity distribution and add them up to get the value of the RiskCompound for that iteration. (There is no way to get at the individual severity values that were drawn withon one iteration.)

» See also "Deductible and Limit in RiskCompound"

Textbook of the Month

The DecisionTools Suite is included in dozens of major textbooks, and is a key component of more titles every year. Authors use the DecisionTools Suite to illustrate key analytical concepts and build examples demonstrating the value of quantitative techniques in business, OR, and engineering.

Entrepreneurial Finance:
Strategy, Valuation, and Deal Structure
by Janet Kiholm Smith, Richard L. Smith, Richard T. Bliss

Entrepreneurial Finance: Strategy, Valuation, and Deal Structure applies the theory and methods of finance and economics to the rapidly evolving field of entrepreneurial finance. This approach reveals how entrepreneurs, venture capitalists, and outside investors can rely on academic foundations as a framework to guide decision making.

Entrepreneurial Finance is most effectively used in conjunction with a companion website, On this site, students and professors can access deeply discounted DecisionTools Suite academic software for use in conjunction with the book.

» Learn more from the publisher
» View a list of books bundled with Palisade software

Featured White Paper

Professors, PhD candidates, practitioners and others often use the DecisionTools Suite as part of a complex analysis to address important problems. These analyses are published in white papers. Each month we will feature a different academic white paper addressing a wide range of issues.

Using a Case Study of United Way
in Classroom Teaching
by Hikaru Hanawa Peterson, Kansas State University
Modern universities have multi-faceted missions, typically encompassing teaching, research, and outreach. Under financial pressure and changes in societal expectations, increased efficiency in meeting multiple missions is advocated. This article documents the use of a teaching case that involved research and resulted in community outreach. Students at Kansas State University were charged with developing fundraising campaign plans for a local United Way Chapter, using concepts covered in a risk management class. Students collected survey data that revealed giving behavior on campus, and the United Way chapter incorporated the student findings in their successful fall 2003 campaign. While few endeavors can address all missions equally well, the documented case is an example of how an activity centered in one of the university missions can be modified to make useful contributions to the other missions.

Palisade  Read the full paper here

Academic Live Webcast

Professors using Palisade software share examples and teaching tips they've used in class in Palisade's Academic Webcast series. Register online at no charge.

A Stochastic Simulation Model for Dairy
Business Investment Decisions

To be presented by Dr. Jeffrey Bewley, University of Kentucky
May 24, 2012, 11:00am ET

A dynamic, stochastic, mechanistic simulation model of a dairy enterprise was developed to evaluate the cost and benefit streams coinciding with investments in Precision Dairy Farming technologies. The model was constructed to embody the biological and economical complexities of a dairy farm system within a partial budgeting framework. A primary objective was to establish a flexible, user-friendly, farm-specific, decision-making tool for dairy producers or their advisers and technology manufacturers. The basic deterministic model was created in Microsoft Excel. @RISK was employed to account for the stochastic nature of key variables within a Monte Carlo simulation.

» Read more details about the webcast and register here
» See complete Webcast schedule

The Academic Global Leader in
Risk and Decision Analysis
Palisade is the world’s leading provider of risk and decision analysis software and solutions. Founded in 1984, its products @RISK and the DecisionTools Suite are used by over 95% of the Fortune 100, in nearly every industry around the world. Palisade is headquartered in New York State, and has offices in London, Sydney, Rio de Janeiro, and Tokyo.

What is The DecisionTools Suite?

The DecisionTools Suite is the world’s only integrated set of risk and decision analysis programs. The Suite includes @RISK for Monte Carlo simulation, PrecisionTree for decision trees, and TopRank for “what if” sensitivity analysis. In addition, DecisionTools Suite comes with StatTools for statistical analysis and forecasting, NeuralTools for predictive neural networks, and Evolver and RISKOptimizer for optimization. All programs work together seamlessly, and all integrate completely with Microsoft Excel for ease of use and maximum flexibility.

The Suite is offered in three affordable and flexible licensing options for those in academia: Student Versions, Course Licenses and Full Academic Versions.

» Schools using Palisade software
Textbooks using Palisade software

In This Issue

» Construction Productivity
   at Northeastern Univ.

» Recent School Adoptions

» Licensing Options

» Teaching Tips &

   Scheduling Trains to
   Station Stops

» Tech Tips
   Using the RISKCompound
   Function to Evaluate Risk

» Textbook of the Month
   Entrepreneurial Finance:
   Strategy, Valuation,
   and Deal Structure

» Featured White Paper
   Using a Case Study of United
   Way in Classroom Teaching

» Academic Live Webcast
   A Stochastic Simulation
   Model for Dairy Business
   Investment Decisions

» About Palisade and the
   DecisionTools Suite

Keep in Touch

PalisadeClick to chat live with
a sales representative

Risk Conferences

2012 Palisade Risk Conferences
Industry experts present real-world case studies, Palisade consultants deliver workshops and training, plus sneak previews of new software. Don't miss the opportunity to sign up for an Expert Session, in which you can have an expert review your model and answer questions, one-on-one, at no charge!
» London: 18-19 April
» Sydney: 29-30 May
» Las Vegas: 7-8 Nov


» Training Seminars
Melbourne: 19-20 June
Sydney: 10-11 July
Auckland: 18-19 July
Brisbane: 8-9 August

São Paulo: 23-25 de maio
Recife: 13-15 de junho
Belo Horizonte:
   27-29 de junho

EMEA & India
Abu Dhabi: 14-16 May
London: 22-23 May
London: 19-20 June
Paris: 21-22 June

Latin America
Medellín, Colombia:
  13-15 de junio

North America
Houston: 15-17
Minneapolis: 22-23 May
Seattle: 12-14 June
Cayman Islands: 13-15 June
Toronto: 27-29 June
Boston: 17-19 July

» Live Web Training
Decision-Making and
Quantitative Risk Analysis
using the DecisionTools Suite

4-5 June, 1pm-5pm ET

21-22 June, 1pm-5pm ET

Decision-Making and
Quantitative Risk Analysis
using @RISK

5-6 July, 1pm-5pm ET

26-27 July, 9am-1pm

Using Decision Trees
with PrecisionTree to Add
Insight to Decisions

30 May, 11am-3pm ET

Project Risk Assessment
using @RISK

20 August, 9am-1pm ET

» Live Webcasts
These complimentary sessions are 30-60 minutes, held via web conference. See industry case studies, software demos, applications, and more.

A Stochastic Simulation Model
for Dairy Business Investment

May 24, 11:00am ET
Dr. Jeffrey Bewley
University of Kentucky
» Register

Trial Versions

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

The DecisionTools Suite
The complete risk and
decision analysis toolkit

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