Case Review: We developed a method to quantify the benefit of risk identification
Problem: A firm was trying to justify investment in a dedicated risk management software. They agreed on the importance of risk management as an objective, but struggled with justifying the investment in risk management as a functional group.
Approach: We developed a quantitative method to measure the benefits of the risk management organization, by comparing the rate of risk identification to risk occurrence in different functional groups. Our results showed that by increasing the rate of risk identification the firm had reduced the rate of risk occurrence on projects (see figure). While this relationship is somewhat intuitive, the value is in the quantification of the relationship between risk identification and risk reduction. This provided a justification for the investment in the risk organization.
"If I had an hour to save the world, I would spend 55 mins defining the problem and 5 mins solving it"
This quote illustrates the importance of Risk Identification, which is a structured process of creating early awareness of potential issues before they occur.
We have helped companies identify and prevent risks from occurring, by using effective risk elicitation techniques and advanced analytical methods.
We provide project risk registers that represent the uncertainty associated with a project's planned performance