With increased responsibilities, staff cutbacks, and drastically reduced budgets, this is a challenging time for most government institutions. Whether you're focused on cost estimation, human health risk assessment, strategic resource allocation, or production forecasts, you cannot afford to ignore how uncertainty effects your forecasts and exposes your organization to unnecessary risk. Your knowledge and your toolset will make the difference between whether your work succeeds or fails.

Today, Crystal Ball is the risk analysis software tool chosen by more than 85% of the Fortune 500. In government, organizations as diverse as the US Army Corps of Engineers, the New York Power Authority, Los Alamos National Labs, and Health Canada all rely on Crystal Ball to manage risk and make more informed business and strategic decisions.

Crystal Ball is a Microsoft® Excel®-based suite of analytical tools that includes Monte Carlo simulation, optimization, and forecasting. With little effort, you can apply these advanced analytical techniques to your new or existing spreadsheets to create more accurate cost and financial predictions and better informed business decisions.

Low-cost software and improved computing power can enable you to better calculate the risks in your strategy or process. Crystal Ball can help you better assess your alternatives, increase the confidence you have in planning details, and make more informed decisions despite a lack of data or an uncertain.

Key features of interest to your industry include sensitivity and tornado analysis, correlation, and historical data fitting. The sensitivity analysis and tornado analysis are two separate methods that help you to understand which of the uncertain inputs drive the uncertainty in your models. Correlation lets you link uncertain inputs and account for their positive or negative dependencies. If historical data does exist, the data fitting feature will compare the data to the distribution algorithms and calculate the best possible fit and parameters for your data.

One of the greatest benefits of Crystal Ball is its ability to transparently communicate risk to engineers, accountants, and managers who may not be comfortable with results expressed in terms of probability (e.g., a 93% certainty of pollutant contamination in a given area). With Crystal Ball, you can quickly run spreadsheet simulations and view and change the input assumptions, helping your managers and peers to visualize your methods and understand your results. And by quantifying and explaining your operational risks, you can begin to foster results-driven discussion and improve the confidence in strategic decisions.

With Crystal Ball, you can:

• Replace min/max estimates with more accurate range of all possible outcomes
• Reduce the time required to produce estimates,
• Eliminate multiple manual “what if” estimates,
• Mitigate your cost and schedule risks,
• Gain immediate insight to the driving inputs and output variations,
• Make knowledgeable decisions on where to focus resources, and
• Provide decision-makers with factual data that shows the risk associated with each choice.

LEARN MORE ABOUT CRYSTAL BALL FOR GOVERNMENT AND POLICY APPLICATIONS

This page offers links to a growing number of resources, including recorded Web seminars, articles, white papers, case studies, and example models. Additionally, you can view a list of common uses and examples reported directly from customers using Crystal Ball. You can also download a free trial version of Crystal Ball to see how it can help improve your business forecasts and decisions!

RECORDED WEB SEMINARS

Assessing Uncertainty and Risk in Government Acquisition US Government Agencies are implementing policies designed to assess risk in the acquisition process in an effort to prevent program failure and avoid cost and schedule overruns.  More recently, agencies such as the Air Force and NASA are asking for cost estimates at specific percentiles (e.g., 70th percentile for cost) for budgeting purposes.  This requires knowledge of the probabilistic outcomes of the program or project and, in particular, knowledge of the shape and statistical parameters for an S-curve (cumulative distribution).  While this is a positive step, the Government and their contractors (in general) still have fuzzy understanding of the difference between uncertainty and risk.  In this presentation, we will first define uncertainty and risk and show risks can occur in any of these interrelated areas: cost, schedule, and performance.  Second, we will show problems with risk analysis processes that may be encountered in the acquisition process.  Third, we will present alternate views of risk relationships that can provide a framework for more successful risk assessments.  Fourth, we will identify risks found in Government acquisition and finally, we will show how to quantify uncertainty and risk in Crystal Ball. At the end of this one-hour session, you will have developed an understanding of: The relationship between uncertainty and risk How to identify problems with risk analyses and how to “fix” them Types of risk faced in Government acquisition, their potential causes, and a             framework for assessing uncertainty in risk analysis How to quantify uncertainties and risk using Crystal Ball Presented by Ray Covert, Technical Director at MCR, LLC.  Recorded June 2, 2008	View recording Download files
Simulation in an Alien Environment: How to Help Public Bodies Apply Risk Analysis English municipalities now have a system of tradable permits that involves risk and uncertainty within the management of waste. Learn how Urban Mindes introduced Monte Carlo simulation methods to the deterministic economic model developed by the UK Government model to help manage risks. Presented by Glyn Jones, Environmental Economist with the not-for-profit consultancy, Urban Mines Recorded November 7, 2006	View recording Download files
Simulation and Water Supply Forecasting Demonstrates how to use Monte Carlo simulation and regression methods to develop better water supply forecasting models in the American West. He will present and comment on a variety of case studies of canal companies in Colorado. Presented by John McKenzie, founder of Innovastat Corporation Recorded March 20, 2007	View recording Download files
Global Warming – Will We Bake or Not? This seminar shows a Monte Carlo simulation model that forecasts global temperature increase by 2100 using both a linear and logarithmic relationship between CO2 concentration (independent variable) and temperature (dependent variable). Presented by Gaetan ‘Guy’ Lion, Vice President, Planning and Analysis Recorded July 19, 2007	View recording Download files

Top

WHITE PAPERS

Basic Cost Risk Analysis: Using Crystal Ball on Government Life Cycle Cost Estimates R. Kim Clark, Associate, Booz Allen Hamilton	Download
Cashing in on Cable: Warning Flags for Local Government By David Tuerck, Jonathan Haughton, James Angelini, John Barrett, all of The Beacon Hill Institute at Suffolk University. The above link leads to a press release summarizing the paper, and a link to the PDF version of the paper is the bottom of the page.	Download
Crystal Ball in the Rain Forest By John Reid, Conservation Strategy Fund	Download
Quantifying Financial Risk in a Business Case Michael Lionais, CMA, Manager Strategic Costing, Agriculture and Agri-Food Canada	Download
Using Monte Carlo Simulation in Life Cycle Assessment for Electric and Internal Combustion Vehicles By David L. McCleese and Peter T. LaPuma, Air Force Institute of Technology, Wright-Patterson Air Force Base, OH	Download
Using the Value Measuring Methodology to Evaluate Government Initiatives Kevin Foley, Associate, Booz Allen Hamilton	Download

Top

CASE STUDIES

Environment Canada A Risk Assessment of the Effects of Ammonia in Aquatic Environments	Download
Washington State Department of Health Pathway analysis for exposures to radioactive materials	Download
Environmental Evaluation Group (DOE) Using Crystal Ball to Assess an Inhalation Dose from a Radioactive Source	Download
Prison Population Forecasting For Fentress Inc., Crystal Ball Pro is the Key to Forecasting Prison Populations	Download

Top

EXAMPLE MODELS

Risk in Financial Forecasts Application for Valuation, Strategic Planning and Capital Appropriation Decisions From: David T. Hulett, Ph.D., Principal, Hulett & Associates LLC, Project Management Consultants, 12233 Shetland Lane, Los Angeles, CA 90049 www.projectrisk.com Detail: Financial forecasts are notoriously uncertain. This model is a simple and clear demonstration of how to use Monte Carlo simulation to calculate the IRR of a project over a five-year period. The description worksheet discusses the details, assumptions, and results of the model. The model is (c) 2000 International Institute for Learning.	Download For: Crystal Ball Level: Simple-moderate
Budget-constrained Project Selection Detail: The problem is to determine which projects to select to maximize the total expected profit while staying within the budget limitation. Complicating this decision is the fact that both the expected revenue and success rates are highly uncertain. Includes optimizations setting file. Uses binary decision variables for Yes/No decisions and uses the certainty statistic for optimizing the values observed between two endpoints.	Download For: Crystal Ball & OptQuest Level: Simple
Cost Estimation Model Detail: This model is a simplified cost estimating tool for a project manager to understand the cost risks for a project.	Download For: Crystal Ball Level: Simple
Capital Investment Analysis for Two Industrial Plants From: Egberto Lucena Teles, accountant, master in accounting, academical professor - Universidade Mackenzie (São Paulo, Brasil), egberto@mackenzie.com.br Detail: New projects can involve the acquisition of capital goods - tangible assets of long useful life as lands, immobile or machines and industrial equipment. Considering a proposed project of capital investment, the investors should evaluate the expected future cash flows in relation to the amount of initial investment. The objective of the analysis through the method of discounted cash flows is one of finding projects that have a net present value (NPV) positive. In the proposed example, the financial director should make a decision of capital investment in a new industrial plant. The excluding alternatives, that will call Plant A and Plant B, involve a cash flow of a period of six years. The Old Plant (Current) generates a cash flow to present value of $38,211,000. Besides verifying which Plant (A or B) offers Cash Flow Increment in relation to Current Plant, this model tests the implicit risk with relationship to expected return (cash increment). Two models are included, one for each Plant.	Download For: Crystal Ball Level: Simple-moderate
Critical Path / Time to Market Analysis Detail: This model can be used to analyze a project schedule or the time it would take to get a product to market. The goal of this model is to understand the uncertainty of when the project will finish and how often a step will fall on the critical path.	Download For: Crystal Ball Level: Simple

Top

COMMON USES & EXAMPLES

The following examples were provided by our customers and represent only some of the potential goverment-related applications for Crystal Ball.

• Analyse cost risks for Private Finance Initiative (PFI) projects
• Applying Uncertainty Analysis to radiation doses received by individuals exposed through various means
• Bond valuation
• Calculate ingestion rates for environmental impact study
• Cash Flow Valuation of Coal properties
• Cost estimation of US Army operations
• E-Government initiative alternative analysis
• Explore the effect of variability and inaccuracies in estimates of future loads and generation capability on the operation of the electricity network
• Forecast cargo and passenger arrivals
• Forecasting economic impact of proposed economic development project
• Global sensitivity analyses and model selection tournaments
• Homeland security research
• Human health risk assessment modeling for hazardous and radioactively contaminated sites
• Investigate how frequently different discharge activities would result in violations of water
  quality standards
• Life cycle cost projections
• Manage the annual multimillion dollar IT portfolio
• Modeling fish populations and commercial fishing capture rates
• Oil and gas reserves analysis
• Performance assessment of HLW disposal
• Probabilistic Exposure Assessments
• Program management and decision analysis, defense applications
• Quantitative estimates of geothermal resources
• R&D for metallurgical engineering
• Repeated measures simulations in conjuction with customized probabilistic and graph-theoretic modeling
• Risk/return analysis of proposed IT investments
• Risk and uncertainty in assessing invasive species
• Risk assessment of research portfolio
• Software development project cost forecasting
• Uncertainty quatification for a groundwater/vadose zone contamination model
  

Top