Terms & Acronyms (Excel modeling context)

Complexity

Measures the number of component parts (functions, constants, references and operators) included in a model.

Context 

A description explaining what a value represents.

Constant 

A value that cannot change. Constants are usually managed by the modeler.

Data

Any value in a model. See also Information

Data Synchronization

The process of establishing consistency among data from a source to a target data storage and vice versa and the continuous harmonization of the data over time. It is fundamental to a wide variety of applications. https://en.wikipedia.org/wiki/Data_synchronization

Dependent

A cell containing a formula that references another cell. That formula depends on the value in other cells. See Display the relationships between formulas and cells

Dynamic

A model that can accommodate a varying number of transactions, accounts, periods, items, etc. See Scalability.

EUC

End User Computing 

Information

Any value in a model that has proper context and, if applicable, units of measure. See also Data and Context

Interactive

The ability for users to manipulate model controls such as Parameters, Slicers, Filters, Sorts, PivotTables, and Pivot Charts.

Label

Text providing context, units of measure, or format strings to document what a value represents and in which units (if applicable).

Literal

Is value not derived from a formula. Literals are usually keyed by the developer. They may be part of a formula but cannot be the result of a formula

Model

An Excel workbook that attempts to represent a real world object. Real world objects can be entire corporations, subsidiaries, departments, assembly lines, specific projects or, as the example we will use shows, loans. Modeling can be for as-is or future state. Modeling is used in:

• Financial projections, budgeting, planning, mergers and acquisition valuation, cash management, etc.

• Human Resources Position Management, Employee Scheduling, Turnover Projections, etc.

• Manufacturing Planning, MRP, Capacity Planning, Product End of Life Planning, etc.

• Purchasing RFP and RFQ evaluations for TCO

• Operations Capacity Planning, Supply planning, Customer Order projections (CPFR)

• Supply Chain Optimization

• and more

Within each of those examples are differences in the subject matter, formulas, reporting, etc, but modeling mechanics can stay conceptually the same. ERP systems prove this. At a high level ERP systems handle all of these functions with essentially the same mechanics. While Excel allows us to handle things in very dissimilar ways, it also facilitates leveraging the similarities allowing us to apply a single methodology set to a wide spectrum of common business problems which ultimately, enhances our value

Modeler

Person who creates a model. Also known as "developer".

Modeling

Act of creating a model. Also known as "developing".

Model Properties

These are our model's base level parameters. Other modelers call them assumptions. In general all properties are referenced by one or more formulas or they are superfluous and should be eliminated.

Precedent

A cell referenced ;by a formula in another cell. When looking at a formula in one cell, all references in that formula, whether cell addresses or named references, are precedents to that formula. See Display the relationships between formulas and cells

Risk

Measures the sum of things that can fail in a model, their probability of failures, and the severity of potential failures.

Scalability

How well a model can accommodate more transactions, accounts, periods, items, etc. Models that can grow without requiring modeler intervention are highly scalable. Models requiring modeler modifications to grow are less scalable. The more modifications required, the less scalable a model is.

Self-documenting Formula

A formula that explains itself by replacing cell references (computer centric) with descriptive names (human centric) sufficient for humans to understand what the formula is doing and for what purpose.

SOW

Statement of Work. See Advanced Excel Modeling - Project Planning

Transparency

Measures the ease of to access each component or cell's information which includes the values we see and the references from the value is derived. See Excel Model Transparency Definition and Measure

UAT

User Acceptance Testing - The final test before a customer accepts our SOW as complete

UOM

Unit of Measure - identifies a value's units. This can be a label, or a currency or percentage    symbol in the number format.

User

Person who uses a model. Often synonymous with "end user" and "customer"