Cost Modeling

Vanguard System™ Cost Modeling

Complex Models

Cost modeling is effective when relatively fast and reliable. Vanguard System™ is geared for speed and accuracy, especially at your most complex:

  • Product development: Estimate life-cycle costs for next-generation products
  • Project management: Predict risks of budget overruns
  • Operations: Calculate costs of manufacturing processes, distribution plans, and inventory policies
  • Marketing and Sales: Evaluate Cost-effectiveness of promotions and customer-retention campaigns
  • Finance: Analyze P&L and balance-sheet implications of capital expenditures

Costing Methods

The enterprise cost-modeling solution — flexible environment. multiple methods:

  • Generative Costing: Decompose total cost into estimates for individual processes, activities, and resources
  • Parametric Estimating: Set statistical links between cost and design using historical data
  • Technical Cost Models: Integrate performance properties (reliability and quality)
  • Custom: Create new or hybrid costing methods

Easy Interface

Vanguard’s hierarchical-tree interface exemplifies Divide-and-Conquer cost modeling. To build a complex cost model, divide it into two or more simpler component models. To build these component models, apply the same process again, breaking them down into still finer elements. The result is a Vanguard tree.

Unlike spreadsheets, Vanguard automatically constructs a visual diagram that matches the logical structure of your model. This makes it far easier to tackle complex, and sometimes ill-structured cost models.

Vanguard’s tree structure not only simplifies model building, it provides an at-a-glance understanding for those unfamiliar with your model. Anyone can quickly navigate the model, drill down to assumptions, see results and provide feedback.

Real-time Automation and Collaboration

Key knowledge experts are spread throughout the organization. Why then do we rely on individual modelers with second-hand knowledge. Effective cost modeling demands that we tap the right experts directly, engage them in collaborative processes, and provide them with the tools and resources to build libraries of reusable intelligence. Vanguard System delivers on these values with automated precision, threading together myriad component models, currencies, time scales and update schedules to synthesize seamless, active and expanding knowledge bases.

Capture Uncertainty, Quantify Risk

Traditional costing methods calculate a point estimate, or a single number to rely upon as your cost estimate. For this estimate to be true, every aspect of your product, project and system would have to be known with 100-percent certainty. So what happens when things change as they do, such as product design, project scope or production volumes?

Quantitative Risk Analysis is the irreplaceable method we use to capture uncertainty and to quantify our cost risks and opportunities. We replace point estimates (for any parameter) with fuzzy values and conditional branches that reflect our uncertainty. We then assess the probabilities of potential outcomes, as well as the magnitudes and full range of potential outcomes. And when historical data is scarce, we interpret and apply our management estimates, assumptions and uncertainties to similar ends. That’s Vanguard.

At the core of it is Monte Carlo Simulation, a set of advanced statistical methods that we use to simulate thousands of scenarios simultaneously from repeated random sampling. The key here is identifying the importance of our cost risks, given the probability and magnitude of each and every potential outcome.

Features & Benefits


Multiple, simultaneous contributors. Complete analyses combines historical data with collective knowledge and assumptions for greater accuracy.


Scan your model library for useful sequences to add in, link to or build out.

Roll up & Drill Down

Zoom out to view the enterprise as a whole or zero in on specific areas of business for micro detail.


Turn models into interactive web reports in a few clicks. Fully exercise models in real time.


Check yes next to existing business systems — databases, enterprise applications, spreadsheets.

Vanguard Software Applications

Our collaborative, web-based forecasting applications unite roles, teams and departments in achieving the most accurate forecasts in the world – bar none.