The cast
Version one ran nine classes around your company: customers, competitors, suppliers, salespeople, executives, employees, investors, regulators and partners. Six more have been added, each because a real mechanism was missing from the monthly arithmetic rather than because a diagram looked empty. Every one of them has at least one lever you can move.
Three of the six exist only if your record supports them. That is a design rule with arithmetic behind it, and the reason is further down this page.
A class of actor earns its place by making something happen that could not happen before, not by appearing on a chart.
The test for each of these six was the same. Name the mechanism, name the lever, and say what moves in the monthly arithmetic that was not moving before. Anything that could not pass that test is not in the product.
The six
Interest cover, every month. Two months under and it warns. Four months under and it reprices by two points. Seven and it takes back a quarter of the balance. That sequence is what turns a bad quarter into a cash event, and it is the part a spreadsheet forecast never contains.
A price rise reaches them before it reaches the market, and the first thing that moves is their effort rather than their terms. A channel that has quietly stopped pushing looks exactly like a soft market for about two months.
Not your employees. Pay drifts on its own, a vacancy takes months to fill, and a company can only absorb so many starters a month. A hiring plan that ignores all three spends the money in month one and gets the output in month nine.
Their lateness is your revenue slipping into next month, with its cost slipping along with it. For a company that ships, that slip is the difference between a quarter that lands and one that gets explained.
A fixed cost with a date on it. The review is a scheduled event inside the run rather than a smooth line through it, which is what makes it land visibly in the month it happens.
Standing multiplies word of mouth, so a company the market rates gets customers it did not pay for. Every other class in the model responds to business you already have.
One class, opened up
Most of what a lender does in a run is nothing. The interesting part is what happens when the ratio it watches goes the wrong way, and the answer is that it happens in steps, on a schedule, rather than all at once at the end of the year.
Operating profit against the interest owed. One number, taken from the record if you uploaded your debt terms, and the lender sees it in the month it happens rather than when you would have reported it.
Nothing about the money changes yet. What changes is that a breach is now a fact inside the run, and the executive agents can see it, which alters what they are willing to spend.
The cost of the debt rises while the company is least able to carry it. That is the shape of the problem outside the model as well. So it belongs in the arithmetic rather than in a footnote.
Repayment demanded on part of the facility. This is the step that turns a profit problem into a cash problem, and in a run it tends to land in the month a spreadsheet had marked as the recovery.
The six, side by side
| Class | What it watches | What it does about it | Exists when |
|---|---|---|---|
| Lenders | Interest cover, monthly | Warns, then reprices, then calls part of the balance back | Your record shows debt |
| Distributors | Your price, and what your rivals are paying them | Changes how hard it pushes before it changes its terms | Always |
| The labour market | Vacancies, prevailing pay, how many starters you are absorbing | Sets what a hire costs and how long it takes to arrive | Always |
| Carriers | Volume and schedule | Delivers late, moving revenue and its cost into the following month | Your record shows freight or shipping cost |
| Landlords | The lease and the review date | Charges rent, and raises it on the date written in the lease | Your record shows rent |
| Analysts and reviewers | What you do in public, and what your customers say | Moves your standing, which multiplies word of mouth | Always |
The twelve always present classes are the original nine plus distributors, the labour market, and analysts and reviewers. What each of the nine wants and cannot see.
The design rule
A lender, a landlord and a carrier are not created unless something you uploaded says they should be. No debt in the record, no lender. No rent line, no landlord. No freight cost, no carrier.
This is not caution about your data. It is arithmetic. Your operating cost figure already contains the rent you pay, the freight you pay and the interest you pay. Creating a landlord that charges rent on top of a cost line that already includes rent charges you for the building twice, and the run then reports a company losing money it is not losing.
So the rule is that a class which spends money exists only when the record separates that money out. The other twelve cost nothing at the baseline, which is exactly why they can always be there.
Every mechanism moves only as a deviation from today. Nothing charges you at the baseline, because the baseline already happened.
The revenue a company reports is already net of what its resellers keep, and it already reflects how often deliveries arrive late. A mechanism that costs something in the baseline month is not modelling the world. It is double counting your own record.
Why it has to work that way
Every scenario is measured against a baseline run on the same random draws, so the number that reaches you is a difference. If the baseline is wrong in a way the scenario shares, the difference can still be right. If the baseline is wrong because a class of actor is charging a cost your own figures already contained, the difference is wrong too, and it is wrong in the direction that looks like prudence.
That is why all six were built as deviations. A distributor takes no margin at the baseline, because your revenue is already after that margin. What it does is change its effort when your price moves, and only that change reaches the answer.
A carrier is never late at the baseline, because your reported revenue already includes however late your deliveries currently are. It delivers later, or earlier, when something in the scenario moves, and the model carries only that difference.
One more, opened up
Your employees are already modelled. The labour market is the other side of that: everybody you have not hired, and the conditions under which you would.
It carries three things a headcount plan usually assumes away. Prevailing pay drifts on its own, whether or not you are hiring. A vacancy takes months to fill, and the number of months is not the same for every role. And a company can absorb only so many starters in a month before the people already there are spending their week onboarding rather than delivering.
Put those three together and a hiring plan that ignores all of them spends the money in month one and gets the output in month nine. The engine could always have shown that gap. Until there was a labour market in the model, it had nothing to compute it from.
Being honest about it
Yes, per twin. The brief records that it was off, so a run without a distributor in it says so rather than quietly differing from the one you ran last week. What the brief contains.
A debt balance on the record, and ideally the terms. A balance alone is enough for interest cover to be computed against the default thresholds. Terms turn those defaults into your own covenants, and the ledger shows which file did it.
That depends on your record, because named customers, suppliers and departments become individuals rather than averages. Around forty is typical for a company that has uploaded a customer list. Fifteen is a count of classes, not of agents.
It has your customers, and it has your rivals. What it does not have is loyalty, because its loyalty is a margin number. That was true of partners in version one and this is the same mechanism applied to a reseller who holds the shelf.
Satisfaction is what your customers think, and it acts on churn. Standing is what the market thinks, and it acts on people who are not customers yet. Keeping them apart is what lets a run show a company with happy customers that nobody new has heard of.
The industry profile, as priors, marked as priors everywhere they appear, and replaced by any document of yours that gives the real figure. Two months, four months and seven months for a lender are starting points, not law. The ledger.
No. Any company with freight or shipping cost separated out in its record gets one. The mechanism is the same whether you ship a hundred pallets or a thousand parcels, because what it moves is timing.
Upload a cost breakdown and whatever you have on debt, and the twin will tell you which of the conditional classes your record supports and which levers are sitting idle until it does.