Duncan Harwood – Why every risk manager must be using Monte Carlo modelling to evaluate effect of risks

Given the uncertainties businesses have faced as result of the Covid-19 pandemic, it’s hardly surprising many are looking to improve how they do risk management. According to Duncan Harwood, managing director of 2020 Risk Management, introducing Monte Carlo simulation one of the best steps a business can take to improve its risk management processes. Giving… Continue reading Duncan Harwood – Why every risk manager must be using Monte Carlo modelling to evaluate effect of risks

Max Henrion – The wisdom of knowing how little you know

Speaking at Risk Awareness Week, Max Henrion founder and CEO of Lumina Decision Systems, described the power of uncertainty modelling and when risk managers should apply a stochastic lens for decision-making. When you’ve got to catch an early morning flight – how much time do you leave to get to the airport? This was the… Continue reading Max Henrion – The wisdom of knowing how little you know

Recommended pre-reading for the RAW2020 conference

RAW2020 is less than a month away and I wanted to share something valuable with you. During the conference you will hear many of the speakers talk about Risk Management 2 (RM2), decision science, decision quality, probability theory and other terms unfamiliar to many risk practitioners or business decision makers. These 3 things will help… Continue reading Recommended pre-reading for the RAW2020 conference

Your kids are not taught risk management at school, you have to do it

I wanted to start with some typical math problems in school: Two cars started from the same point, at 5 am, travelling in opposite directions at 40 and 50 mph respectively. At what time will they be 450 miles apart? At 9 am a car (A) began a journey from a point, travelling at 40 mph. At… Continue reading Your kids are not taught risk management at school, you have to do it

Why risk community rejects science, logic and common sense

First, I wanted to share an extract from the book I am reading at the moment Alchemy: The Dark Art and Curious Science of Creating Magic in Brands, Business, and Life The chapter is called “I Know It Works in Practice, but Does It Work in Theory? On John Harrison, Semmelweis and the Electronic Cigarette”… Continue reading Why risk community rejects science, logic and common sense

3 steps to apply Monte-Carlo simulations to any investment project decision

Risk management 2 shouldn’t be difficult. So I started on a quest to come up with a simple methodology for quantitative risk analysis that will actually improve decision making. This is still work in progress, so any comments and suggestions please send them to me or write below the article. Also don’t forget, RAW2020 is… Continue reading 3 steps to apply Monte-Carlo simulations to any investment project decision

The better alternative to “inherent” and “residual” risk concepts

Few things are certain in life: death, taxes and someone in the risk community asking about inherent and residual risks. In fact the question is so frequent that I even did a short video response: To most organisations inherent vs residual comparison is a way to measure potential risk mitigation effectiveness and the reduction in… Continue reading The better alternative to “inherent” and “residual” risk concepts

5 red flags 🚩when just starting to implement risk management

Ok, the title is obviously irony, because no organisation on the planet is ever “just” starting to implement risk management” or “starting from scratch”. Organisations have been making risk-based decisions since the inception. Often poorly, but that’s another point altogether. And yet, far too many job advertisements I see are looking risk specialists to build… Continue reading 5 red flags 🚩when just starting to implement risk management

5 red flags 🚩when hiring a risk manager

One of the biggest issues in the risk management profession is that many, way too many, people who have the title of risk manager are not really qualified to do the job. Many don’t even have the minimum required education. Imagine a doctor who vaguely remembers doing biology in year 9 high school. Well that’s… Continue reading 5 red flags 🚩when hiring a risk manager

3 steps to set corporate risk appetite

Ok, the title is obviously irony. If you have seen any of my posts you will know how sceptical I am of this management fad called risk appetite. I am actually old enough to remember when consultants started pushing this concept pretending it was both new and useful. Anyway, since the concept is unlikely to… Continue reading 3 steps to set corporate risk appetite