At King’s College, @RISK is used
to Evaluate the Economic Impact of
Dr. Sadmir Ciketic, Research Fellow in Health Economics at King’s College London has been using Palisade’s @RISK since his postgraduate days. His research in health economics and public health involves economic evaluation of healthcare programs and quantifying risks and uncertainties to evaluate the economic impact of medical interventions, such as the costs and benefits/harms of new medications, new or existing treatments and medical technologies.
According to Dr. Ciketic, Palisade’s DecisionTools Suite provides good estimates for the adverse outcomes and risks associated with new interventions or medical drugs introduced into the market. The Suite’s @RISK especially comes in handy for complex simulations and parameter uncertainties in modeling economic evaluations of medical interventions for making policy decisions. The software allows him to change the different assumptions of critical estimates in practice—for example, using a different distribution or a different method of sampling and simulation of results. Typically, quality of life estimates are derived from clinical trials and systematic reviews and as such these data already have a varying degree of confidence associated with them. This is especially of importance in solving the economic problem of limited resources in the public health arena. This is where the DecisionTools Suite and @RISK join in. Through Monte Carlo simulation, models can account for a whole range of possible outcomes, and indicate how likely they are to occur, providing crucial estimates that can be interpreted and used in policy and decision-making.
“In my current area of work for King’s College London, I mainly use quantitative analysis,” said Dr. Ciketic. “The two most common examples of the distributions that I use include the beta distribution for the quality of life estimates and gamma distribution for cost estimates. The use of these distributions is justified due to the fact that quality of life parameters in the model are binomial data---mainly probability parameters in the model ranging in values from 0 to 1, while the cost data are non-negative and in many cases skewed. Due to the fact that cost is represented in Bayesian statistics (discrete) by a Poisson distribution, the gamma distribution is a conjugate to the Poisson and as such is constrained on the interval 0 to positive infinity.”
Dr. Ciketic also attends presentations and events organized by Palisade on a regular basis. He said, “There is always something new to learn and something that is very useful in relation to @RISK, and all the other DecisionTools Suite tools. It’s a complete suite of programs that are suited for many professions from science, finance, government, health and many other areas. I like the fact that Palisade has this broad level of use that is relevant in all aspects of life. ”
» More about King's College
» More about @RISK and the DecisionTools Suite
The user friendly applications are
a key to the understanding of the
Dr. Sadmir Ciketic, Research Fellow in
Health Economics, King's College London
Over 60,000 students use the DecisionTools Suite annually in their MBA and graduate level programs. In 2012, 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:
Brigham Young University|
Carnegie Mellon University
Florida International University
George Washington University
High Point University
Jackson State University
Montana State University, Billings
New York University
Ohio State University
Penn State University
Texas A&M University
University of Arkansas
University of Manitoba
University of Michigan, Dearborn
University of Pennsylvania
University of St. Thomas
University of Tulsa
University of Utah
University of Waterloo
University of Wisconsin, Madison
||Associaзгo Paranaense de Cultura (APC) - Brazil |
Curtin University - Australia
Escuela de Ingenierнa de Antioquia - Colombia
FACULDADES CATУLICAS - Brazil
Hoegskolan i Gaevle - Sweden
Indian Institute of Management - India
Instituto Tecnologico y de Estudios Superiores de Monterrey - Mexico
Judge Business School - United Kingdom
Martin-Luther-Universitaet Halle-Wittenberg - Germany
Nanyang Technological University - Singapore
Queensland University of Technology - Australia
RMIT University - Australia
Swansea University - United Kingdom
TU Delft - Netherlands
Unitec - Honduras
Universidad Nacional de Colombia - Colombia
Universidad ORT Uruguay - Uruguay
Universitа della Tuscia - Italy
Universitaet Osnabrueck - Germany
Universitetet i Stavanger - Norway
University of Adelaide - Australia
University of Auckland - New Zalandyes true
University of Ibadan - Nigeria
University of Leeds - United Kingdom
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. Palisade offers a complimentary Live Web Training session to all instructors who order a Course License.
» 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 6 for your course by contacting:
Palisade Academic Sales
800-432-7475 / 607-277-8000
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.
Applying @RISK Simulation to Decision
Tree Analysis: A Seismic Survey Example
Excerpted from Energy Risk Modeling,
by Roy Nersesian, published by Palisade
Suppose that you’re employed in the offshore exploration division of an oil company. Seismic tests generate a three dimensional color-coded view of geologic structures within the earth. Natural gas and oil fields have distinct geologic structures, but such structures do not guarantee the presence or the amount of natural gas and/or oil.
The oil company has already made a decision that no offshore drilling will proceed without an initial seismic survey. Furthermore, no offshore exploratory drilling will be done on the basis of the initial seismic survey alone. If the first seismic survey indicates a potentially favorable underwater geologic formation, then a decision has to be made whether to proceed with a second and possibly a third seismic survey before a final decision is reached on whether to drill an exploratory well. An implied decision branch has already been pruned: if the initial seismic survey is unfavorable, under no conditions will a well be drilled. This rules out a False-Negative outcome – drill with a negative initial seismic survey and discover an oil or natural gas field.
Download the following .pdf file to follow the step-by-step instructions of how to set up a decision tree in PrecisionTree for this example.
View the step-by-step instructions
What was my Random Number Seed?
Q: I've run a simulation, but it was with the random number seed set to "Choose Randomly". How can I find out what seed @RISK actually used, so that I can reproduce the simulation later?
A: If Quick Reports were run automatically at the end of the simulation, look at the Simulation Summary Information block on any of them. The RandomSeed item gives you the random number seed that was actually used. If you haven't run Quick Reports, you can do that without re-running the simulation: click Excel Reports and tick Quick Reports.
If you don't have any outputs, or if you have a lot of them and don't want to run Quick Reports, you can use a snipped of Visual Basic code without being a programmer:
- Press Alt-F11 to open the Visual Basic Editor, then F7 to open the code window.
- Paste this code into the window:
Risk.Simulation.Settings.randomSeed = _
- Click Tools » References and tick the proper reference or references. For @RISK 6.1 or later, those are Palisade @RISK 6.x for Excel Object Library and RiskXLA. For other versions, in @RISK click Help » Developer Kit » Help and look at the Getting Started topic.
- Click somewhere in the middle of the Show Seed routine, and press F5 to run the code. This will change @RISK's Simulation Settings, on the Sampling tab, to a Fixed random seed. and it will insert the actual seed from the latest simulation as the seed for future simulations.
- If you leave the code in place, Excel 2007 or above will no longer store the workbook as an .XLSX but instead will use .XLSM format. This may present you or anyone who opens your workbook with a macro security prompt. To prevent that, you can delete the pasted code before you save the workbook. The fixed random seed will remain in Simulation Settings.
- Save the workbook to save the fixed random seed.
» See more in the Palisade Knowledge Base
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.
Introduction to Probability Models: Operations Research, Volume II
By Wayne Winston
This text, the second volume of Wayne Winston's successful Operations Research: Applications and Algorithms, covers probability models with recent contributions from financial engineering, computational simulation and manufacturing. The specific attention to probability models with the addition of recent practical breakthroughs makes this the first text to introduce these ideas together at an accessible level. Excellent problem sets abound utilizing the DecisionTools Suite. The text provides a balanced approach by developing the underlying theory while illustrating them with interesting examples. All of the necessary mathematical requirements are reviewed in Chapter 1.
» Learn more from the publisher
» See a list of books bundled with Palisade software
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.
A Comparison of Failure Probability
Estimates by Monte Carlo Sampling
and Latin Hypercube Sampling
Charles N. Zeeb and Patrick J. Burns
Colorado State University, Department of Mechanical Engineering
This report covers two methods to determine failure probability and other related quantities. The basic problem is as follows. Assume we are given a complex function which depends on several variables. Each variable has its own distribution; all of which are known. Given a certain threshold value for the function above which failure occurs, what is the probability of failure? One way to accomplish this is to calculate the function
many times. By binning the function evaluations or trials, an estimate of the failure probability can be obtained. Enough trials must be done to achieve statistical convergence to
some tolerance or threshold; more on this below.
One issue is how the values used in each trial are determined. In this report, two methods are explored, Monte Carlo sampling (MCS) and Latin hypercube sampling (LHS).
Read the full paper here
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
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» At King’s College, @RISK
to Evaluate the
Economic Impact of
» Recent School Adoptions
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» Teaching Tips &
Applying @RISK Simulation
to Decision Tree Analysis:
A Seismic Survey Example
» Tech Tip
What was my Random
» Textbook of the Month
Introduction to Probability
Models: Operations ,
Research Vol. II
» Featured White Paper
A Comparison of Failure
Monte Carlo Sampling
Latin Hypercube Sampling
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