The process of removing physical, spatial, or temporal details or attributes in the study of objects or systems in order to more closely attend to other details of interest.
Agency is the capacity of an actor to act in a given environment. We use the term agent to refer to any process, person, system or organisation with agency.
The distribution of possible returns, given the set of risks you face from your position on the Risk Landscape.
The model of reality held by an individual, team, software system or other Agent. You can regard the concept of Internal Model as being what you know and what you think about a certain situation. An internal model represents reality: reality is made of matter, whereas the internal model is information.
Obviously, because we’ve all had different experiences, and our brains are wired up differently: everyone will have a different Internal Model of reality.
Any moment where we test an Internal Model by exposing it’s predictive power against reality. Note that “Reality” might be limited in some way, for example, a trial period or test users.
Payoff refers to the value of the actions we take. When we decide on a course of action, we have in mind a risk we wish to manage. If the action is likely to have a big positive effect on the risk of a project, we say it has a promising payoff, whereas if the action fails to manage the risk, then it hasn’t paid off.
A possibility of loss or cost. Anything that can go wrong on a project, or is going wrong, but resists exact realization. We talk about risk because we wish to recognise both the range of possibilities and the range of cost.
Usually broken down into:
A Risk you expect to face as the result of Taking Action.
Risks you aren’t aware of when you consider Taking Action. i.e. an unknown unknown.
Risks that, as a result of Taking Action have been minimized.
The possibility of things going well, and leaving us with a benefit. We may take action to maximize the likelihood and return of upside risks.
Found this interesting? Please add your star on GitHub to be invited to join the Risk-First GitHub group.