About ArrowHead – History and Methods

Over 30 Years Helping Clients Understand Future Commodity Markets and Make Correct Decisions

Unique fundamental commodity models and experienced, knowledgeable, market experts solving tough market economic and decision problems

Four decades ago, ArrowHead founders, leading-edge economists and probability experts from business, government, research, and engineering, set out to create a consultancy to help companies make better decisions by combining the best of economics and predictive modeling with decision analysis and risk management. Through a series of renowned companies (Stanford Research Institute, Decision Focus, Inc., Altos Management Partners, and MarketPoint, Inc.), we have solved the really tough market economic and decision problems helping our clients prosper and avoid risk.

Analytic Methods That Clients Bet On and Won

With some, economics has a bad name. “Forecasts are always wrong” is the catchphrase. That is true with many economists, consultants and models because of the implicit, subjective nature of their approach. In contrast, ArrowHead and predecessor company founders built detailed, explicit, agent-based, microeconomic models used (for example):

  • Across energy markets (oil, products, gas, electricity, coal, renewables, and tradable emissions)
  • In telecommunications (product line price discrimination) for most of the major players
  • In the travel industry for real-time:
    • Seat pricing used by key airlines (United, Continental, SAS, Air France, British Air)
    • Rental car pricing
    • Hotel room pricing
  • In semiconductor and high tech industries
  • In primary resource industries (mining and forest products)
  • In highway and infrastructure industries

Our economics has been unique. Companies have bet their money on our price and price discrimination forecasts, and they have won.

Improving on Over 30 Years of Modeling Excellence

Deterministic (single case) economics is not enough. What is needed is economics with intrinsically embedded probability and uncertainty. Single cases, multiple scenarios, Monte Carlo methods, probability trees, etc. simply have not met the need. Modern decision makers need to know the impact of uncertainty on market prices; agents have been observed to hedge, contract, and engage other sophisticated behavior. ArrowHead has met the challenge by building on decades of continuously improved models and incorporating advanced methods from the economic literature pioneered by the ArrowHead namesake Nobel Laureate Kenneth Arrow and others. With world class software models and market and economic experts, ArrowHead helps its clients understand future markets and uncertainty enabling them to meet current challenges and make better decisions.