One of the most common use cases in Pigment is creating financial plans, often referred to as Version Planning or Scenario Planning. Whether you decide to use Versions or Scenarios (or both) to create plans and forecasts in Pigment depends on your modeling needs. This article describes all these approaches, so you can understand which is the best fit for your use case.

Why use Versions and Scenarios?

Versions and Scenarios help you structure and explore various perspectives on your business data. You use these to manage plans, forecasts, and "What-If" analyses, such as: 

• Actuals. Business data that reflects real-world performance, often used as the foundation for plans and forecasts.
• Live Forecast / Rolling Forecast. A forecast combining actuals (where available) with the most realistic projections for future performance.
• Reforecasts. Periodic updates to plans based on changing circumstances, allowing you to refine projections throughout the year.
• Budgets. Structured, often static financial plans that guide business operations over a specific period.
• "What-If" Scenarios. Alternate versions of plans that explore potential outcomes, such as:
  • Reforecast Q2 Optimistic (Best-case scenario)
  • Reforecast Q2 Expected (Most likely scenario)
  • Reforecast Q2 Pessimistic (Worst-case scenario)

Modeling overview

Plan with the Version Dimension

Using a Version Dimension works well when your model requires complex reporting, granular Member data access control, and integration with Pigment’s template library.
 

How it works
The Version Dimension is useful for structuring plans such as Budgets, Reforecasts, and Actuals. By creating a Version Dimension, you can easily add individual Items for each plan and structure relevant Metrics with it. This allows you to manage multiple plans efficiently and reference them in formulas. Additionally, the Clone Data To feature enables you to initialize new plans by copying data from existing plans.
 

Advantages

• Flexible modeling and access. Leverages the full power of Pigment formulas and Member access, including the ability to reference plans in formulas.
• Customizable Dimensioning. Allows you to choose which Blocks are structured by the Version Dimension, which Blocks to exclude, and even to create multiple version Dimensions for subsets of plans.
• Data import capability. Supports uploading multiple plans into a Transaction List.
• Auditability. A well-built Application using Versions is highly auditable.
• Plan initialization. Enables easy initialization of plans by creating a new Item in the Version Dimension and using the Clone Data To feature.
• Flexibility in reporting options. Access the full range of reporting features that are available with any Dimension in Pigment.

Tips when building with the Version Dimension

• Plan ahead of time. If you know that the data in your Application needs to be versioned, ensure this is part of the implementation plan. Ideally, the Version Dimension needs to be implemented early in your Application. 
• Design your model to scale alongside your growing Dimension. The same advice when modeling with structural Dimensions, such as Calendar Dimensions, applies here. Design and build the model to minimize the recalculation of Items in the Version Dimension. This is especially important if you expect the Version Dimension to be used in many Metrics within the Application. Use Snapshots and archiving techniques to maintain your model and keep it efficient.
• Limited Snapshot comparisons. Snapshots cannot be compared directly within Tables using only the Version Dimension, but is an effective way to archive a full version of your Application.
• Scenarios integration. While the Scenarios feature can be activated on top of the Version Dimension, plan ahead to ensure that you can build the reporting you need.​​​​​​​

Plan with Scenarios

Scenarios work well when you want to model different assumptions and compare outcomes without modifying core data. They support a quick setup, and are useful in "What-If" analyses , especially in Applications with large datasets.

How it works
Activate Scenarios within your Application to create Snapshots and alternate versions of your plans. Scenarios make it possible to compare live models with Snapshots, allowing you to explore alternate reporting conditions efficiently without significant changes to your existing structure.

Advantages

• Quick set-up. Can be modeled as an afterthought—just activate Scenarios and create a new item, which will result in a new copy of data for all Metrics within the Application for that Scenario. This makes the feature ideal for performing “What-if” analyses on demand. 
• Powerful Snapshots. Leverage Scenario Snapshots for point-in-time views and easy comparisons between live models and Snapshots.
• Simplified Scenario creation. Enables end users to create Scenarios more easily and initialize new plans quickly and accurately, even across Applications, reducing errors compared to using the Version Dimension.
• Cross-Application initialization. Setting up a new plan or Scenario is not limited to a single Application but can be applied seamlessly across multiple Applications within the platform with shared Scenarios. 
• Secure access to Scenarios by Role. Restrict data access and visibility of Scenarios in Page selectors by Role within the Application by applying access rights per Scenario.

Tips to be aware of when using Scenarios

• Formula referencing restrictions. Scenarios cannot be referenced in the formula bar, limiting some calculations. We recommend using Scenarios for “What-if” analysis, as a way to compare a version of your data across Metrics using Calculated Items and the Show Value As feature rather than using formulas.
• Template Library incompatibility. Not compatible with the template library, sometimes requiring significant reconfiguration depending on which standard Applications are used.
• Tree structure limitations. Once created, Scenarios cannot be reordered because they become a structural component of the model. Instead, we recommend that you use the Copy Scenario Inputs feature to transfer input data from one Scenario to another. ​​​​​​​

Implementing each approach 

Set up and use Version Dimensions for planning

Version Dimensions are a best practice in Pigment, allowing you to organize and manage multiple forecasts and plans efficiently. They are structured as a Dimension list, similar to other business-specific Dimensions, and typically include items like individual plans and Actuals.

Ideally, you create a Version Dimension at the outset of your financial planning. It ensures a streamlined structure, and avoids the complex task of needing to redesign and rebuild later. 

We recommend these best practices when you use Version Dimensions: 

• Regularly review and clean up your Version Dimension to ensure it reflects current and relevant plans.
• Use descriptive naming for each version to make it clear what each plan represents.
• Leverage the Clone Data To feature to save time and ensure consistency when creating new plans.​​​​​​​

To set up a Version Dimension in Pigment, do the following: 

1. Open the Application where you want to set up a Version Dimension.
   As a best practice, this should be in a centralized location, such as your Hub Application.
2. Create a new Dimension called Version.
3. Create Items in the Dimension for the required individual plans and Actuals.
   For example:
   • Actuals
   • Budget 2024
   • Rolling Forecast Q1 2024
4. Create the Blocks in the Application that need to be versioned: 
   • Include data from multiple plans, such as budgets, forecasts, and actuals.
   • Structure these Blocks using the new Version Dimension.
     This organizes and structures your data by each version.

To manage plans in the Version Dimension, do the following: 

1. To add a new plan:

   • Create a new Item in the Version Dimension List, for example: Reforecast Q2 2024. 

2. To base a new plan on an existing plan: 
   a. Use the Clone Data To feature in Pigment.
   b. Structure these Blocks using the new Version Dimension.
        For example:
        - Source version: Budget 2024
        - Target version: Rolling Forecast Q2 2024
   c. Adjust the cloned data as needed for the new version.

Set up and use Scenarios for planning

For more information on setting up Scenarios in Pigment, see the following topics: 

• Getting Started with Scenarios in Pigment 
• Creating and Editing Scenarios in Pigment 
• How to View and Compare Pigment Scenarios
• Editing Formulas within Scenarios 
• Copy Inputs Between Scenarios

Plan with "What-If" analyses 

Creating "What-If" analyses in Pigment allows you to explore alternative outcomes for your plans, such as best-case, worst-case, or expected results. Depending on your Application's current setup, you can use Scenarios for quick and flexible adjustments or the Version Dimension for structured, detailed comparisons. By leveraging either of these, you can evaluate potential impacts, refine forecasts, and make informed decisions with ease.

How to implement a “What-If” analysis  

The approach you choose for creating a "What-If" analysis depends on if you have already used Scenarios or the Version Dimension in your Pigment Application: 

• Scenarios. Continue to use Scenarios. 
• Version Dimension. Do one of the following: 
  • Create additional items in the Version Dimension 
  • Combine Scenarios with the Version Dimension

“What-If” analysis examples

Scenarios

The following image illustrates several Scenarios which assess the range of potential outcomes for the upcoming 4 quarters of the financial year. 

Version Dimensions

The following image illustrates a Version Dimension called Plan with all combinations of plans and outcomes for the financial year. You use this Dimension to structure all relevant Blocks in your planning. 

Version Dimensions combined with Scenarios

The following images illustrate how Scenarios and the Version Dimension are set up for this combined approach. 

The image below illustrates how both Scenarios and the Version Dimension are used in a Pigment Table to display specific revenue data, with two row headers representing the Version Dimension and Scenarios.

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Considerations when combining Scenarios with the Version Dimension 

There are both benefits and limitations to be aware of when combining Scenarios with the Version Dimension in a “What-If” analysis. 

We recommend that you use the combined approach only if you need to create Scenarios dynamically alongside Versions. Doing this allows you to test different assumptions across all Metrics and Versions in the Application. However, if you need full flexibility to compare different combinations in your reports, then we recommend that you use the Version Dimension.  

Benefits of the combination approach

• Quick Implementation. Scenarios can be implemented without adjusting Version Dimensions in additional Blocks.
• Enhanced User Experience. Creating new Scenarios is simpler, faster, and less error-prone for end users. End users have much easier access to create new Scenarios. 

Limitations of the combination approach

• Impact to Reporting Views. All “What-If”  Scenarios will appear across all plans. To account for this, we recommend using “What-If”  Scenarios for dynamically testing assumptions rather than incorporating them into static reports if they don’t meet your requirements. If you need static reporting with plan-specific “What-If” Scenarios, then consider creating additional Items within the Version Dimension to represent those conditions.
• Manual Updates Across Scenarios. Changes in one Scenario cannot be propagated to others. If you require updates to be aligned across Scenarios, we recommend using the Copy Scenarios Inputs feature.
• Access Rights per Role per Scenario. Scenarios in Pigment limit access rights to Role, unlike the Version Dimension which allows you to apply more granular access rights.