7.4 Do Not Forget Uncertainties and Latencies
87
Fig. 7.1 A taxonomy of uncertainty
The concept of latency introduced by Renn and Klinke is a very important one
with tailings dams, where errors and omissions, decisions made at project inception
may generate failures decades into the structure service life.
Continuing the discussion on uncertainties, lately we found an interesting taxonomy of uncertainty in view of decision making (Fig. 7.1).
To make things simple, let’s summarize the taxonomy this way:
The top half (Objective Uncertainty) of Fig. 7.1 is where risk analysis is.
Epistemology: is concerned with the nature of knowledge itself, its possibility, scope,
and general basis. More broadly: How do we go about evaluating risks? or How do
we separate true risks from “white noise”? or How can we be confident when we have
analyzed the true risks? Rational quantitative risk assessments are epistemological
applications as they are a systematic way by which we can determine when something
is good or bad for a business and make knowledge-based decisions.
Ontology: is concerned with identifying, in the most general terms, the kinds
of things that actually exist. When we ask deep questions about what is the
hazardous environment of a facility? Or is there a risk? We are asking inherently ontological questions. Hazard identification is a ontological action, and PIGs
risk matrix (https://www.riskope.com/2016/12/28/answering-risk-questions-cannotanswered-common-practice-approaches/) would also fall in this category, despite
their well-known limitations, delivering quasi-rational decisions.
The bottom half (Subjective Uncertainty) (https://plato.stanford.edu/entries/formalbelief/) of Fig. 7.1 is where gut feelings and pre-conceived behavior lie.
Moral: here belong all the approaches based on pre-cooked lists and forms, audits,
compliance actions. People will deliver Rule-based decisions, without understanding
the existence and truth of the risk landscape surrounding the decision.
Rule: this is where gut feelings, your rules, i.e., pre-conceived behaviors, are kings.
This is where, if you are lucky people will remember you as a “genius”, but if
you are wrong, people will forget about you. You will join the scores of audacious
intuition-guided decision makers, or the “stupid guys” of Fig. 7.2.
87
Fig. 7.1 A taxonomy of uncertainty
The concept of latency introduced by Renn and Klinke is a very important one
with tailings dams, where errors and omissions, decisions made at project inception
may generate failures decades into the structure service life.
Continuing the discussion on uncertainties, lately we found an interesting taxonomy of uncertainty in view of decision making (Fig. 7.1).
To make things simple, let’s summarize the taxonomy this way:
The top half (Objective Uncertainty) of Fig. 7.1 is where risk analysis is.
Epistemology: is concerned with the nature of knowledge itself, its possibility, scope,
and general basis. More broadly: How do we go about evaluating risks? or How do
we separate true risks from “white noise”? or How can we be confident when we have
analyzed the true risks? Rational quantitative risk assessments are epistemological
applications as they are a systematic way by which we can determine when something
is good or bad for a business and make knowledge-based decisions.
Ontology: is concerned with identifying, in the most general terms, the kinds
of things that actually exist. When we ask deep questions about what is the
hazardous environment of a facility? Or is there a risk? We are asking inherently ontological questions. Hazard identification is a ontological action, and PIGs
risk matrix (https://www.riskope.com/2016/12/28/answering-risk-questions-cannotanswered-common-practice-approaches/) would also fall in this category, despite
their well-known limitations, delivering quasi-rational decisions.
The bottom half (Subjective Uncertainty) (https://plato.stanford.edu/entries/formalbelief/) of Fig. 7.1 is where gut feelings and pre-conceived behavior lie.
Moral: here belong all the approaches based on pre-cooked lists and forms, audits,
compliance actions. People will deliver Rule-based decisions, without understanding
the existence and truth of the risk landscape surrounding the decision.
Rule: this is where gut feelings, your rules, i.e., pre-conceived behaviors, are kings.
This is where, if you are lucky people will remember you as a “genius”, but if
you are wrong, people will forget about you. You will join the scores of audacious
intuition-guided decision makers, or the “stupid guys” of Fig. 7.2.