Analytica - Hierarchical Influence Diagrams

Hierarchical Influence Diagrams

Analytica models are organized as influence diagrams. Variables (and other objects) appear as nodes of various shapes on a diagram, connected by arrows that provide a visual representation of dependencies. Analytica influence diagrams may be hierarchical, in which a single module node on a diagram represents an entire submodel.

Hierarchical influence diagrams in Analytica serve as a key organizational tool. People find it natural to conceptualize the structure of models both spatially and hierarchically. Because the visual layout of an influence diagram matches these natural human abilities both spatially and in the level of abstraction, people are able to take in far more information about a model's structure and organization at a glance than is possible with less visual paradigms, such as spreadsheets and mathematical expressions. Managing the structure and organization of a large model can be a significant part of the modeling process, but is substantially aided by the visualization of influence diagrams.

Influence diagrams also serve as a tool for communication. Once a quantitative model has been created and its final results computed, it is often the case that an understanding of how the results are obtained, and how various assumptions impact the results, is far more important than the specific numbers computed. The ability of a target audience to understand these aspects is critical to the modeling enterprise. The visual representation of an influence diagram quickly communicates an understanding at a level of abstraction that is normally more appropriate than detailed representations such as mathematical expressions or cell formulae. When more detail is desired, users can drill down to increasing levels of detail, speeded by the visual depiction of the model's structure.

The existence of an easily understandable and transparent model supports communication and debate within an organization, and this effect is one of the primary benefits of investing in quantitative model building. When all interested parties are able to understand a common model structure, debates and discussions will often focus more directly on specific assumptions, can cut down on "cross-talk", and therefore lead to more productive interactions within the organization. The influence diagram serves as a graphical representation that can help to make models accessible to people at different levels.

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