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UN 4.1  Unify scenario analyses

Analyze scenarios by comparing them and by calculating their absolute and relative variances. Notation standards for scenario analyses cover the labelling of variances and the semantic design of chart elements such as columns, bars, and axes.

   

 

Scenario comparisons

Scenario comparisons place the data of different scenarios next to each other, for example actual data next to previous year or budget data. This is relevant for both charts and tables. In tables scenarios usually are shown in columns.

 

Scenarios can be compared in an absolute or relative way:

Absolute variance = primary scenario – reference scenario

Relative variance = absolute variance / reference scenario

 

Arrange scenarios of different time periods (mainly years) in temporal ascending order either from left to right (horizontal axes) or from above to below (vertical axes), e.g. PY (=  AC 2014), FC 2015, PL 2016.

 

No rule governs the sequence of scenarios referring to the identical time period – e.g. AC 2015, FC 2015, PL 2015, but the selected sequence should be kept the same in all charts and tables.

 

Scenario comparisons are visualized either by grouping columns or bars (e.g. overlapping columns of PY and AC or overlapping bars of PL and AC), or with scenario triangles using the respective area coding (e.g. solid light color for PY) to represent the reference scenario. Scenario triangles can also be added to overlapped bars or columns in order to show a third scenario.

 

The scenarios AC and FC stand in the foreground of other scenarios in grouped columns or bars.

   
 

Absolute variances

An absolute variance is the difference between two values of one measure from different scenarios.

 

The sign “Δ” represents the absolute variance as a prefix to the subtrahend of the respective difference, i.e. “ΔPL” for the absolute difference “AC minus PL” (AC-PL) or – if FC is compared to PL – “FC minus PL” (FC-PL).

 

The most common absolute variances are the following:

  • Plan variance: “ΔPL” for AC-PL or FC-PL (when comparing FC to PL)
  • Previous year variance: “ΔPY” for AC-PY or FC-PY (when comparing FC to PY)

If it is not clear whether AC or FC is compared to plan in ΔPL or ΔPY, use the following notation:

  • Plan variance: “AC-PL” and “FC-PL”
  • Previous year variance: “AC-PY” and “FC-PY”

Positive absolute variances (as well as positive percent variances) have a “+” to emphasis this aspect: “+13” always means a variance of 13, “13” means any absolute value of 13.

 

If absolute variances are displayed in columns or bars (“variance columns” or “variance bars”), these variance columns or bars have the same width and the same scale as the corresponding base value columns or bars.

   

Variance bars and columns representing a positive impact on business issues (mainly result) are colored green, those representing a negative impact red. Variance bars and columns representing a neutral impact are colored medium gray. If no color is available, replace red with dark gray, green with light gray. For readers with color deficiency, replace green with blue-green.

 

The labels of single bars and columns as well as the numbers representing variances in tables can be colored in the same way.

 

Note: These colors for positive, negative, or neutral variances must not be confused with red and green “traffic lights” (see also EXPRESS rule EX 2.5 "Replace traffic lights").

 

   

In order to visualize the scenario to be analyzed (minuend), apply scenario notation to the fill of the variance columns or bars, e.g. solid green or red fill for AC and hatched green or red fill for FC. If in special cases the minuend is PL (e.g. variance of plan versus average) the variance columns and bars are outlined green or red.

 

Position data labels for variance columns and bars always outside of these visualization elements. These labels’ position aligns with the direction of positive or negative increase, i.e. the label of a positive variance (green) in a variance column is positioned above the column; the label of a negative variance (red) on the left hand side outside of the bar.

 

In order to visualize the reference scenario (subtrahend) of an absolute variance (in general PY, PL, or BU), apply scenario notation to the axis: For absolute variances to PY the axis is colored solid light, for absolute variances to PL or BU the axis takes an outline shape (two parallel lines).

 

Treat variances of ratios, e.g. percent values (profit on sales) in a special way: Absolute variances of percent values are called percent points, e.g. AC 50% - PL 40% = +10pp

   

 

Relative variances

A relative variance is an absolute variance as a percentage of the subtrahend of the absolute variance.

 

For the textual notation of relative variances, use the sign “Δ” as a prefix to the subtrahend and the sign “%” appended, e.g. ΔPL% for the relative variance (AC-PL)/PL*100.

 

The most common relative variances are the following:

  • Plan variance: “ΔPL%” for(AC-PL)/|PL|*100 or (FC-PL)/|PL|*100 (when comparing FC to PL)
  • Previous year variance: “ΔPY%” for(AC-PY)/|PY|*100 or (FC-PY)/|PY|*100 (when comparing FC to PY)

Use the following notation if it is not clear whether AC or FC is compared to Plan:

  • Plan variance: “(AC-PL)%” and “(FC-PL)%”
  • Previous year variance: “(AC-PY)%” and "(FC-PY)%”

Positive relative variances(as well as positive absolute variances) have a “+”-to emphasize this aspect: “+13%” always means a variance of 13%, “13%” means any kind of percentage such as ratio or a share.

   

Relative variances are displayed in thin columns (vertical pins) or thin bars (horizontal pins).

 

Pins representing a positive impact on business issues (mainly result) are colored green, those representing a negative impact red. Pins representing a neutral impact on business issues are colored medium gray. If no color is available, replace red with dark gray, green with light gray. For readers with color deficiency, replace green with blue-green.

 

The labels of pins and the numbers representing variances in tables can be colored in the same way.

 

Note: These colors for positive, negative, or neutral variances must not be confused with red and green “traffic lights” (see also EXPRESS rule EX 2.5 "Replace traffic lights").

 

Position data labels of pins outside the pin in the direction of the positive or negative increase, e.g. position the label of a horizontal pin depicting “sales growth in %” (green) is positioned on the right hand side of the pin; position the label of a vertical pin depicting “cost decrease in %” (green) below the pin.

 

Add head markers to the pins to visualize the scenario to be analyzed (minuend). Apply the scenario notation is to the fill of the heads, e.g. solid dark fill for AC and hatched fill for FC.

 

Apply scenario notation to the axis in order to visualize the reference scenario for a relative variance (in general PY, PL, or BU): For relative variances to PY fill the axis solid light, for relative variances to PL or BU the axis takes an outline shape (two parallel lines).

 

Treat relative variances of percent values the same way as relative variances of absolute values, e.g. (AC 50% - PL 40%) / PL 40% * 100 = +25%.

   
   
   
   
   
   
   

 

 

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