Paragon Simulation Technical Article

“Don’t Let Me Be Misunderstood”

Vinod Bhatia

Decision-Making Using Simulation

Simulation modelling is about making decisions.  Yet all too often the most significant part of a modelling project is the model itself, rather than the information it generates to give confidence to decision-makers.

Imagine you’re presenting the project outcomes to your client.  Depending on how snazzy the display is, it can be quite rewarding to show an audience the model operating – with parts and people moving around the screen, and all the colours flashing – and getting encouraging feedback.  But unless you’re illustrating to the group how a specific situation is developing, the model display only ever shows the condition of the process at a particular point in time, which is no use to the managers who are looking to make complex decisions.  And if you don’t manage this carefully, your project meetings can become technically-oriented, and the big story that you’re building up to can get lost.

The display has lots of important uses, such as proving that the model is operating in the way that is intended, or for training purposes.  But generally speaking, managers need to see the results of running the simulation model in different scenarios, and comparing performance indicators.  You are really presenting them with a series of doors, and using the model to help them decide which ones to go through.

So I think it’s best to start with the story constructed out of the results, and look at the model at the end of the meeting.

In our work we try to understand how the model behaves, to get an understanding of the real-life dynamics, and communicate that using understandable graphics.  For example, imagine the system’s key performance is measured in Units per Hour (UpH) and you have validated the throughput for the existing system.  Then you develop a series of scenarios, which successively improve the output.

The table of results could look like this:

Simulation Results

Simulation Results Histogram

That’s looks good, but could the results be displayed graphically?  Of course, the obvious idea is to show these results as a Column Chart, which when presented in the right sequence becomes an ”Improvement Staircase.”  It’s now easier to see that the first and last change had the biggest impact.


ItSimulation Results 3D Histogram can be tempting to use advanced presentation capabilities of software, such as Excel, to make the graph more interesting, like using 3D.  But the effect of perspective makes the relative impact of changes difficult to assess.  The example is a bit extreme, but you get the idea.

Could we go further?  One of the most effective ways of communicating the relative impact of change is to use a Waterfall Chart.  This takes the basic Column Chart and re-presents it to show the starting and finishing scenario, and the impact of the intermediate scenarios as a step-change.

“Waterfall Charts…allow you to take your client on a journey of discovery”


These charts can be tricky to construct, but it’s definitely worth the effort as it explains things so clearly, and allows you to take your client on a journey of discovery.

The experience we have is that these charts become the centre-piece of the conversation, and managers discuss the merits of different change ideas with a clear knowledge that they are focusing on the right things.

In fact, by starting with the big impact story, you may never ever get to show them the model!