Comparison of Two Alternative Technologies


The purpose of this model is to compare two alternatives which in this case represent two alternative technologies. As part of this analysis, we want to contrast the cost, reliability and overall performance of two replacement plans for a now obsolete technology in a larger military system. There are 1,000 units of the larger system in service, and they are currently experiencing both reliability and performance problems due to the obsolete subsystem.

A commercial, off the shelf (COTS) technology can be obtained which exceeds the design requirements, but is less rugged than a custom solution which has been developed to a prototype stage.  Although it is less rugged, the off the shelf solution is stocked by sellers in most major cities of the world. 

The custom solution requires a significant stockpile of parts be maintained and moved to areas where the system will be operational.  

The model tracks the overall performance and cost of the COTS versus the custom units over a ten year period.   The simulation begins with the obsolete system and then switches to the new systems as they become available over a 12-month period.   The new technology has an expected life of 7 years, but the model will be run to 10 years, to account for the time required to switch to a subsequent technology.

At this time, there are several significant uncertainties:

•    The in-service reliability of the COTS units.
•    The in-service reliability of the custom units.
•    The cost and time required to deploy the custom system, and the cost of replacement units.

Probability distributions (Stochastic elements) are used to generate a range of inputs to represent the inherent uncertainty. All data used in the model are fictitious, and values were used simply to illustrate the simulation approach and results. Because both replacement systems provide similar performance, the key metrics are system availability and overall cost. Scenarios in GoldSim are used in this example model in order to provide an easy way to compare results given different (scalar) inputs. Three different scenarios are included in the model.

Two Data elements are modified as part of the three scenarios. The first Data element is "Scenario". When the value of this element is 1, then there is no lag in development of the Custom solution. This is the value used in Scenario 2. The second Data element which is modified as part of the three scenarios is the unit. The expected cost for this item is $1,000 per unit. However in Scenario 3, the cost of this item is reduced to $250 per unit in order to make the COTS option lower cost on average.

Scenarios are an advanced modeling capability included in GoldSim. Scenarios are differentiated by having different sets of input data. In particular, different scenarios have different values for one or more Data elements. GoldSim’s scenario modeling capability allows you to directly compare results generated by your model by different sets of input parameters. In effect, when you use this capability, your model can store (and subsequently compare) multiple sets of inputs and outputs.

When using Scenarios, the Scenario Manager can be used to set-up the scenarios and to run all scenarios. Scenario Manager can be accessed from the main menu (Run | Scenario Manager…) or by pressing F7, and when the model with Scenarios is run from Scenario Manager, the model is in Scenario Model. Scenario Mode is a special model state that allows scenario results to be displayed and compared. Scenario results can only be compared when the model is in Scenario Mode.

Additional Information


Stochastic element, Scenario Mode, Scenario Manager


GoldSim Features & Capabilities, GoldSim Applications, Running a Model & Viewing Results, Supply Chain & Business Process Modeling, Financial Modeling , Economic & Policy Analysis, Cost Modeling & Project Planning

Experience Level

GoldSim Technology Group


Making Better Decisions In An Uncertain World