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Risk analysis - how much constitutes "paralysis"?

There are any number of ways to analyse a risk, some involving very detailed quantitative techniques. At what point does that stop adding value and start hindering or slowing down the development of response plans & actions?
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RE: Risk analysis - how much constitutes "paralysis"?

I would say it is when further analysis will not make any difference to the risk decision i.e. if the output of existing analysis has already enabled a clear and justified decision why go any further.

If there is some doubt about the decision based on the analysis i.e. it is a 50:50 decision, there may be benefit to doing more analysis.

Obviously there is a reliance on existing analysis being accurate.
AlexGEnergizer at 1/30/2018 6:33:57 AM Quote
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RE: Risk analysis - how much constitutes "paralysis"?

Concerning Risk Analysis Paralysis.

My initial thoughts is that are several considerations:
1) What is the objective of the analysis and who is performing it? 
So analysis by a Risk Management function or a business unit may be part of their decision making process - forward looking. Therefore delay could have a greater impact. 

Analysis by the Audit function may be a secondary level of analysis and it may afford more time. These are  "reflective" in nature and looks back.

2) What are the business requirements or other performance indicators that can be used to ensure the analysis is not getting out of hand e.g. quality, cost/benefit, time
e.g. a project manager should not spend an inordinate amount of time performing the analysis unless it has planned the time to do so in the project. Or the Audi function does analysis independent of other business units who perform analysis for decision making, so the impact will be to delay the recommended corrective actions at most. 

In general, the objective and big triangle: time, quality and cost contributes to determine what will be analysis paralysis in each unique case.

Ricardo443Lively at 1/30/2018 6:38:08 AM Quote
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RE: Risk analysis - how much constitutes "paralysis"?

Adding to the comments above... * Yes, there is a cost/benefit notion * Yes, it depends on the role Considerations: * The method of risk evaluation entirely shapes the cost/benefit. More costly and less valuable risk evaluation methods necessarily cause evaluation to stop too soon. * Appropriate detail is often compared to areas such as sports. The question is the edge needed to win a competitive game. Stopping too soon necessarily threatens organizations. * Methods of risk response shape the cost benefit, too few approaches, excessive use of controls and uncoordinated responses necessarily lead to the view that benefit will be low and cause evaluation to stop too soon. Very similar to quality management. Hope this helps, Brian
Brian BarnierEnergizer at 1/30/2018 9:47:10 PM Quote
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(Unrated)

RE: Risk analysis - how much constitutes "paralysis"?

Adding to the comments above... * Yes, there is a cost/benefit notion * Yes, it depends on the role Considerations: * The method of risk evaluation entirely shapes the cost/benefit. More costly and less valuable risk evaluation methods necessarily cause evaluation to stop too soon. * Appropriate detail is often compared to areas such as sports. The question is the edge needed to win a competitive game. Stopping too soon necessarily threatens organizations. * Methods of risk response shape the cost benefit, too few approaches, excessive use of controls and uncoordinated responses necessarily lead to the view that benefit will be low and cause evaluation to stop too soon. Very similar to quality management. Hope this helps, Brian
Brian BarnierEnergizer at 1/30/2018 9:47:10 PM Quote
You must sign in to rate content.
(Unrated)

RE: Risk analysis - how much constitutes "paralysis"?

Concerning Risk Analysis Paralysis.

My initial thoughts is that are several considerations:
1) What is the objective of the analysis and who is performing it? 
So analysis by a Risk Management function or a business unit may be part of their decision making process - forward looking. Therefore delay could have a greater impact. 

Analysis by the Audit function may be a secondary level of analysis and it may afford more time. These are  "reflective" in nature and looks back.

2) What are the business requirements or other performance indicators that can be used to ensure the analysis is not getting out of hand e.g. quality, cost/benefit, time
e.g. a project manager should not spend an inordinate amount of time performing the analysis unless it has planned the time to do so in the project. Or the Audi function does analysis independent of other business units who perform analysis for decision making, so the impact will be to delay the recommended corrective actions at most. 

In general, the objective and big triangle: time, quality and cost contributes to determine what will be analysis paralysis in each unique case.

Ricardo443Lively at 1/30/2018 6:38:08 AM Quote
You must sign in to rate content.
(Unrated)

RE: Risk analysis - how much constitutes "paralysis"?

I would say it is when further analysis will not make any difference to the risk decision i.e. if the output of existing analysis has already enabled a clear and justified decision why go any further.

If there is some doubt about the decision based on the analysis i.e. it is a 50:50 decision, there may be benefit to doing more analysis.

Obviously there is a reliance on existing analysis being accurate.
AlexGEnergizer at 1/30/2018 6:33:57 AM Quote
You must sign in to rate content.
(2 ratings)

RE: Risk analysis - how much constitutes "paralysis"?

I would say it is when further analysis will not make any difference to the risk decision i.e. if the output of existing analysis has already enabled a clear and justified decision why go any further.

If there is some doubt about the decision based on the analysis i.e. it is a 50:50 decision, there may be benefit to doing more analysis.

Obviously there is a reliance on existing analysis being accurate.
AlexGEnergizer at 1/30/2018 6:33:57 AM Quote
You must sign in to rate content.
(2 ratings)

RE: Risk analysis - how much constitutes "paralysis"?

Concerning Risk Analysis Paralysis.

My initial thoughts is that are several considerations:
1) What is the objective of the analysis and who is performing it? 
So analysis by a Risk Management function or a business unit may be part of their decision making process - forward looking. Therefore delay could have a greater impact. 

Analysis by the Audit function may be a secondary level of analysis and it may afford more time. These are  "reflective" in nature and looks back.

2) What are the business requirements or other performance indicators that can be used to ensure the analysis is not getting out of hand e.g. quality, cost/benefit, time
e.g. a project manager should not spend an inordinate amount of time performing the analysis unless it has planned the time to do so in the project. Or the Audi function does analysis independent of other business units who perform analysis for decision making, so the impact will be to delay the recommended corrective actions at most. 

In general, the objective and big triangle: time, quality and cost contributes to determine what will be analysis paralysis in each unique case.

Ricardo443Lively at 1/30/2018 6:38:08 AM Quote
You must sign in to rate content.
(Unrated)

RE: Risk analysis - how much constitutes "paralysis"?

Adding to the comments above... * Yes, there is a cost/benefit notion * Yes, it depends on the role Considerations: * The method of risk evaluation entirely shapes the cost/benefit. More costly and less valuable risk evaluation methods necessarily cause evaluation to stop too soon. * Appropriate detail is often compared to areas such as sports. The question is the edge needed to win a competitive game. Stopping too soon necessarily threatens organizations. * Methods of risk response shape the cost benefit, too few approaches, excessive use of controls and uncoordinated responses necessarily lead to the view that benefit will be low and cause evaluation to stop too soon. Very similar to quality management. Hope this helps, Brian
Brian BarnierEnergizer at 1/30/2018 9:47:10 PM Quote
You must sign in to rate content.
(Unrated)

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