Foresight and risk management
By using our structural causal model, you can anticipate a much wider range of potential side effects, enabling more effective risk management and foresight into the unintended consequences of seemingly good decisions.
Foresight
Our foresight services include regularly updated reports, discussions, and scenario work. We generate foresight with simulation models that replicate the behaviour of all market participants, effectively mimicking the entire market.
This is achieved by modelling the decision-making processes of individuals in the market, creating a simulation that acts like a digital twin of the real world. Our models replicate historical data, producing simulated data that matches past events. We then extend this model to project future outcomes.
Foresight is further enhanced by sensitivity runs, which account for uncertainties in key business variables. For example, we can test different scenarios to see how changes in market demand, cost fluctuations, or competitor actions impact outcomes.
Scenarios
Scenarios enable simulating the results of “what-if” thought experiments and quick reactions to events like epidemics, strikes, and natural disasters. We typically respond within a day or two to questions such as:
“How will our biggest competitor closing a factory next month affect our product price?”
“Does the price forecast change if the strike in Finland continues for another week?”
During the COVID-19 pandemic, we quickly ran scenarios for our clients, helping them understand the potential market impacts of the unprecedented situation. These benefits are not available with traditional models that rely solely on historical data.
Scenarios enhance decision-making and deepen understanding. Over time, our clients gain more insights, often learning from counterintuitive scenario outcomes.
Market risk protection
Our simulation and model-based foresight provide effective risk management. Our market risk protection solutions cover a range of scenarios, including changes in competitors’ product prices, fluctuations in costs, and the unintended consequences of seemingly right decisions.
We also offer simulations of financial processes to help identify situations that could lead to difficult cash flow issues, enabling proactive measures to maintain financial stability.
