A Management Perspective: Predict Performance Faster to Record Profits Sooner

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It's no secret: Simulation can predict performance, reduce risk and let you see the impact of change.  Those who use it know how simulation can help a project get off the ground days – if not weeks -- earlier than imagined.

What often goes unnoticed is the over $10,000-per-day benefit that can be realized by using simulation to shave time off of a project's start date.

Audited results show the after tax, three year cumulative cash flow benefit from the predictive power of simulation for typical division-wide projects in global enterprises is $14,954,000.  That's $13,657 per day in net profit after tax for every day sooner project benefits begin.

But in the past, simulation modeling by way of software programming was such a tedious, laborious process. Often simulation ventures resulted in so much hardship and frustration that it wasn't deemed worth the time.

That was then. This is Simio.

C. Dennis Pegden, an inventor of Arena, has created Simio – a simulation tool that enables the building of complex 3D models without programming.  Users of Simio experience dynamic system modeling in 1/3^rd the time normally required because no programming is required.

So what is it worth?  If we assume the elapsed project time to the first dollar benefit is 270 days of which 54 days of simulation analysis is needed, using Simio the analyst will save the project 67% of the days needed for modeling.  That's 36 days sooner for project benefit to begin.  At $13,657 project benefit per day, the Simio user earns the project an additional $491,652.

From a management perspective, in these economic times, the old cliché ‘time is money' could not be closer to the truth.  If Simio helps predict performance faster, you can record profits sooner.