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Author's profile photo Iver van de Zand

Creating a Value Driver Tree with SAP Analytics Cloud

Modern analytics are way more than just insights into a given situation. They’re about using those insights to create and tune business planning models. They’re also about using insights to combine them into simulations: What would happen if I change this “key influencer” or “that metric”? These simulations—or what-if analyses—are a simple necessity to modern analytics, if you ask me.

In SAP Analytics Cloud, they have answered this need in various ways, including:

  1. A formula-based slider: Basically, this is an input control in SAP Analytics Cloud that is driven by a formula and an input driving it. This input can either be an existing dimension or a list of values. The input is a parameter part of the formula, where the formula calculates the output. An example is an input list going from -15% to +15% where that is made part of a formula to calculate the effect on margin: ((rev*[input])-cost/cost) to calculate what an increase/decrease on revenue would implicate to the margin.

  2. The value driver tree (VDT):  This is a more advanced feature that leverages the interdependencies of metrics onto a driver for final output.

Value Driver Tree

The value driver tree is a physical representation of interdependencies in measures that is used to generate a simulated effect of changing an underlying measure onto its parent. SAP Analytics Cloud allows for slider inputs to change metrics and recalculates the whole model on its outcome. Very, very powerful and extremely helpful for simulation and planning purposes.

The key to the VDT is the correctness of the underlying SAP Analytics Cloud model. First, this model needs to be a planning model. Next, the model should have defined hierarchies in its accounts (metrics).

In the following video, I demonstrate step by step how to create a VDT in a very simple—and semi-automated—way.


Learn More

  • Sign up for the SAP Analytics Cloud Free Trial to try it yourself.
  • Read our other cloud analytics blogs for “How-To” posts like this one, and general information about cloud analytics for SMBs, financial planning and analysis in the cloud, predictive in the cloud, and more.

This article originally appeared on Iver van de Zand’s blog, Passionate about Analytics and has been republished with permission.

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