EPM applications, such as Planning, have two inherent limitations when it comes to analysis:
You can only change a small view or slice of the data at one time. As a result, exploring all of the possible scenarios and outcomes is next to impossible; you cannot realistically determine the amount of risk that is affecting your business or organization.
“What-if” analysis, such as exploring the best or worst case scenarios, always results in a single view of the business and does not include the likelihood of achieving any particular outcome. While single views might tell you what is possible, they do not tell you what is probable.
Crystal Ball EPM overcomes these limitations:
You can describe ranges of possible values for the uncertain factors and drivers in your application. Everything you know about each factor or driver is expressed at once. For example, you can define a key “Cost of Goods Sold” ratio as being any value between 70% and 80%, instead of using a single-point estimate of 75%. Crystal Ball EPM then uses this information as input to a simulation.
Using a process called Monte Carlo simulation, Crystal Ball EPM generates hundreds, if not thousands, of realistic scenarios for your business. It then forecasts the entire range of possible outcomes and the likelihood of achieving each of them. With this information, you can answer questions like “What are the chances of exceeding our expense target?” or “How likely are we to achieve this level of profitability?”. You’ll no longer have to make decisions like this without realistic data to back them up.
To summarize, Crystal Ball EPM is an analytical tool that helps planners, analysts, forecasters, and others make intelligent decisions by performing simulations on EPM applications. The forecasts that result from these simulations help quantify areas of risk so decision-makers can have as much information as possible to support their decisions.
The basic process for using Crystal Ball EPM is to:
While Monte Carlo simulation is easy to understand and straightforward, you should become familiar with the basic concepts and features of Crystal Ball EPM before using it with EPM applications. The best way to quickly familiarize yourself with Crystal Ball EPM is to read the introductory material and work through the tutorials in the Oracle Crystal Ball User's Guide.
Note: | Crystal Ball EPM and related products are the only Crystal Ball products that support integration with the EPM System components described here. Users with an application-specific license may not be able to run Crystal Ball example models and the tutorials in Crystal Ball documentation. |