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Reducing Initial Investment

Reducing initial investment is desirable from a cash management standpoint, but also from a risk standpoint.  Tactics to reduce initial investment in a project are listed below. Staged investment Make a partial investment, and wait for more information before making follow-up investment. Example: Buy land.  Develop if it is desirable to do so. Example: R&D …

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What is Project Flexibility and Where Can I Find It?

The idea of project flexibility is conceptually desirable and accepted in both corporate strategy and in the design decisions that go into product development.  The problem is that it has generally been difficult to quantify the value associated with flexibility, and therefore difficult to justify. Developing products and services always involves unknowns.  Uncertainty in market …

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Corporate Structure

Corporate structure is the overall makeup of how a company structures its divisions, departments, and people. While corporate structure by itself generally won’t ensure success, it is often a key enabler in order to execute a given strategy. With that, we will look at some ideas for corporate structure that may align with executing overall …

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Integration Using Monte Carlo Simulation

Monte Carlo integration can be used to estimate integrals that cannot be easily solved by analytical methods.  There are several methods to apply Monte Carlo integration for finding integrals.  In this article we will cover the basic method. Basic Monte Carlo Integration The basic method of Monte Carlo integration randomly samples the function value on …

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Business Models

Business Model How a company makes money. This definition is a bit shorter than most, but really we are talking about how to generate excess cash after expenses are subtracted from revenue.  Identifying the model that your business, or future business, operates under may allow for new insights into how you can improve what you’re …

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New Simulation Master Tutorials

A new series of Simulation Master tutorials has been added.  Simulation Master is an Excel add-in for Monte Carlo simulation.  Check them out to see how to use this tool and be sure to download a free trial version to see the power of Simulation Master for yourself. Simulation Master Tutorials Simulation Master Product Page