Risk and uncertainty

This category contains 62 posts

Predicting an uncertain future

I was listening to the Today programme last week, and was struck by an interview between the Business presenter, Dominic O’Connell, and BP’s Chief Economist, Spencer Dale. (It’s around 24 minutes in if you want to listen for yourself.) The economist was talking about BP’s research into demand for oil. Currently we use about 100 … Continue reading

Visualising cause and effect in risk management

The other day I came across an interesting collection of visualistions around risk and uncertainty. It was produced by Nico Lategen as a demonstration, and his example was Brexit. (Clearly a favourite topic for those of us interested in uncertainty.) Initially my interest was around his scale representing sovereignty. This reflects what I’ve written about … Continue reading

Visualising uncertainty with bar charts

Previously I’ve advocated the use of probability distribution curves to describe uncertainty more clearly. It helps us get away from the binary success/fail of traditional risk listing, and instead allows a much wider understanding of the likelihood of different gradations of outcome. For example, not just whether we’ll make our predicted profit, but different degrees … Continue reading

Accepting failure enables rational exits

You’ve probably heard the idea that we should allow people to fail. You’ve probably also heard the phrase “fail fast”, meaning that we should both allow failure and be set up sufficiently to recognise it and recover from it quickly. In both cases I’ve always seen the benefits of accepting failure as allowing us to … Continue reading

Even successful subversion is a sliding scale

A few weeks ago Theresa May talked directly about Russia’s attempts to undermine democracy in the UK. It does this by planting “fake news” in social media, as well as direct cyber attacks and influencing individuals. Yet I also heard a claim on BBC News that one government source said there was no evidence that … Continue reading

Responding to risk involves many actions

When people talk about “managing risk” they often list individual “risks” and then choose an action to deal with each one. However, this approach is often too simple, and misses subtleties. That’s probably because what people call a risk is often an event which is much too narrowly defined, and hence the solution (the action) … Continue reading

What does “take more risk” mean?

Last week I picked up on something from a Norman Marks blog post. But something also caught my attention in the comments below it, which has intrigued me before: the idea that organisations might want to “take more risk”. The idea that we might be taking “too little risk”, and therefore should “seek to take … Continue reading

What does it mean to “manage” risk?

What do we mean when we say we need to “manage” risk, or “manage” a risk? I’m not talking about financial risk, which is a world of mathematical models and algorithms. I mean project risk or enterprise risk, which typically manifests itself in risk workshops, risk registers, mitigation actions, and regular discussion of “risks” either … Continue reading

More answers are available than we might think

We’re often faced with decisions that seem outside our area of expertise. Last week I met some founders on the Emerge.Education programme and one of them gave an example of this: her company was considering changing from content management system A to content management system B. It seemed like a big step, and while her … Continue reading

When certainty is absent

Among all the noise about Brexit, one line I keep hearing is that “businesses need certainty”. We can read this message from the British Chambers of Commerce, from the Confederation of British Industry, and it’s a message the Chancellor has repeated, too. Undoubtedly certainty is helpful. But those who run businesses deal with uncertainty all … Continue reading

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