Glossary

The words for explaining why a number moved, each with a worked example you can check with a calculator.

Driver treeA driver tree breaks one result, such as profit, into the inputs that produce it, joined by arithmetic, so you can see which input moved the result.Read the example
Variance analysisVariance analysis compares an actual number with a reference (the budget, last month, last year) and splits the difference into the drivers that caused it.Read the example
Price-volume-mix analysisPrice-volume-mix (PVM) analysis splits a change in revenue or margin into three effects: prices changed, more or fewer units sold, and the share of each product in what sold changed.Read the example
Bridge chart (waterfall chart)A bridge chart, also called a waterfall chart, starts at one total, adds and subtracts a floating bar for each cause, and ends at the new total.Read the example
What-if analysisWhat-if analysis changes one or more inputs of a model to see what happens to the result, before anything is changed in real life.Read the example
Sensitivity analysisSensitivity analysis moves each input of a model by the same amount, one at a time, to find which input the result depends on most.Read the example