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Understanding Models and Scenarios

Models enable you to define how to measure performance within your organization and the types of data that you want to review through various reports. For example, you may want to review revenue information on a region-by-region basis—a very high-level scope. Or, you may want to review only those activities that relate to a certain product line for certain types of resources—a very narrow scope. Each analytical application uses models and scenarios differently.

Regardless of the size or scope of your model, you must initially proceed with the same set of steps. Likewise, when you set up models you perform setup steps that are common to all products in the PeopleSoft EPM product line. However, how you complete the process depends on which EPM products you license.

Note: You should refer to your application-specific documentation for more information on models and scenarios in your product.

Modeling Terminology

When using models, you should familiarize yourself with the following terms:

  • Parent model: The master model that is used as the basis for an impact study.

  • Child model: A child model stores the changes to the master or parent model.

    The child model inherits all the properties from the parent model.

  • Scenario: You create a scenario ID for each parent and child model that you want to study.

    This scenario ID is used on all run controls.

Object-Based Modeling

Object-based modeling enables you to simulate various changes in an organizational model and study the impact on costs, revenue, and profitability. Instead of copying the whole model, you can copy only the data that needs to be changed. This reduces the volume of data copied and helps to identify the changes made and any effects the changes may have. Object-based modeling helps to define just the changes for the child model. All the unchanged data for the child model is inherited from the parent model. Enhanced modeling features improve the maintenance, reusability, and flexibility of a model, enabling you to create parent and child models easily.

Object-based modeling can be used not only in PeopleSoft Activity-Based Management but also in other applications in PeopleSoft EPM so that you can use your system to do planning and simulation. Scenarios for planning and simulation can be defined as child models. Child models represent the business decisions and assumptions for the scenarios. Scenarios can be simulated for each child model using various forecast distributions for a given timespan. Results for various scenarios can be compared to select the best case scenario.

Scenarios

Once you establish warehouse business units and SetIDs, you create model IDs (where you define the parent and child relationships) and then point to those model ID by means of a scenario ID. Scenarios:

  • Serve as a wrapper to run all analytic models.

    When you run the analytical application engines, the engines tie the models together by means of the scenario ID.

  • Enable you to work with what-if scenarios by creating more than one scenario with different models attached for what-if comparisons.

There are two types of scenarios:

  • Historical.

  • Forecast.

To set up scenarios:

  1. Complete the Scenario Definition page.

  2. Select the type of scenario (historical or forecast) and complete the appropriate pages.

  3. Specify the rates that you want to use on the Economic Assumptions page.

  4. Assign the scenarios to a business unit using the PF Unit Scenario Definition page.