Advanced Decision Modeling Skills for Excel (8 hrs Remote Online)
OVERVIEW
This workshop presents the key tools necessary for today's business analyst to model complex scenarios and optimize for the best outcomes. This hands-on training will present case studies, practical theory, and real-life examples on how to implement advanced decision modeling techniques as well as simulation and optimization into your models.
TARGET AUDIENCES
- People who have previous experience with simulation and Excel modeling, including: Business Analysts, Managers/Executives and , Consultants.
- Users of either Oracle Crystal Ball, ModelRisk, @RISK, Risk Solver or Risk Simulator
WORKSHOP CONTENT
MODULE 1 – OPTIMIZATION AND SCENARIO MODELING
Review of key concepts
- Simulation Concepts
- Statistics and Probability Math
- Excel Modeling Best Practices
- Simulation Models vs. Optimization Models
Simulation Optimization
- Introduction to Simulation - Optimization with Crystal Ball
- Everyday Optimization applications and examples
- How does Simulation Optimization Work
Portfolio Optimization Techniques : With the help of several integrated financial models, this workshop will provide financial analysts with a complete understanding of why, where and how to apply spreadsheet forecasting, simulation, real options and optimization within their analyses.
- Project Portfolio Selection: Use OptQuest to pick the best projects based on Organizational Budget Constraints
- Portfolio & Resource Allocation Optimization: Allocate resources or budgets among various investments to maximize NPV or ROI or minimize risk or expense.
- Modeling Efficient Frontier Analysis to optimize risk against benefit for projects and investments. (Portfolio Allocation)
Decision Tables to compare complex 2 dimensional problems
- Workshop: Inventory Options
- Creating 3D solution plots
MODULE 2 – ADVANCED DECISION MODELING TECHNIQUES
Decisions under uncertainty:
- Overview of Bayes’ Theorem and its analytical applications
- Bayes applied to medical testing
- Workshop: How to improve profitability with additional information
- Bayes applied to Quality Control
Value of Information
- How much should you invest to collect additional information using Hubbard’s VOI approach with a UNIFORM rule.
- Perfect versus imperfect information
- Using VOI to constrain or optimize portfolios
Decision Trees
- Overview of decisions trees
- Methodology for documenting strategic options using decision trees
- Conventional NPV versus Expanded NPV
- Workshop: Using Bayes Theorem and Decision Trees to decide whether to hire a reserves expert (oil and gas / mining) or not and the decision’s impact on NPV
Introduction to Real Options Analysis
- Overview or Real Options Theory
- Discounting Assets over time using lattices
- Workshop: Integrated DCF and valuation using a 2 Phased Sequential Real Option
BENEFITS
At the end of this 1 day workshop, participants will be able to:
- Make better and more informed decisions using scenario analysis and simulation
- Compare simulated projects to select the best alternative
- Use Bayesian techniques and leverage the value of information
- Discuss the use of Real Options and Expanded NPV’s impact on project selection
- Quickly build effective optimization models or customize existing ones
- Pick and manage project more effectively
- Use a portfolio optimization model where the efficient allocation of resources is analyzed to improve the quality of your business decisions.
