Cim2013 oboni oboni_zabolotoniuk

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Presentation given on May 6th at CIM 2013 Toronto.
A discussion on the reasons that lead to the generalized public distrust phenomena, how better risk assessments would help reduce distrust and support better decisions.

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Cim2013 oboni oboni_zabolotoniuk

  1. 1. (c)Oboni Riskope Associates Inc.(c)Oboni Riskope Associates Inc. www.riskope.comwww.riskope.com foboni(a)riskope.com Pagefoboni(a)riskope.com Page 11 of 22 2013/04/XXof 22 2013/04/XXCan We Stop Misrepresenting RealityCan We Stop Misrepresenting Realityto the Public?to the Public?By Franco Oboni,By Franco Oboni,Cesar Oboni, Oboni Riskope Associates Inc.,Cesar Oboni, Oboni Riskope Associates Inc.,www.riskope.comwww.riskope.comSusan ZabolotniukSusan Zabolotniuk szabolotniuk@gmail.comszabolotniuk@gmail.com
  2. 2. (c)Oboni Riskope Associates Inc.(c)Oboni Riskope Associates Inc. www.riskope.comwww.riskope.com foboni(a)riskope.com Pagefoboni(a)riskope.com Page 22 of 22 2013/04/XXof 22 2013/04/XXLets start with a point we probablyLets start with a point we probablyall agree upon:all agree upon:There has been approximately half aThere has been approximately half acentury ofcentury ofPUBLIC DISTRUSTPUBLIC DISTRUST
  3. 3. (c)Oboni Riskope Associates Inc.(c)Oboni Riskope Associates Inc. www.riskope.comwww.riskope.com foboni(a)riskope.com Pagefoboni(a)riskope.com Page 33 of 22 2013/04/XXof 22 2013/04/XXThere was a time Public consideredThere was a time Public consideredScientists trustworthy experts.Scientists trustworthy experts.
  4. 4. (c)Oboni Riskope Associates Inc.(c)Oboni Riskope Associates Inc. www.riskope.comwww.riskope.com foboni(a)riskope.com Pagefoboni(a)riskope.com Page 44 of 22 2013/04/XXof 22 2013/04/XXMeanwhile governments wouldMeanwhile governments wouldoftentimes neglect risk assessments,oftentimes neglect risk assessments,leading, forleading, forexample, toexample, todisastrousdisastrousresidential zoningresidential zoningdecisions,decisions,generating vivid,generating vivid,media-friendymedia-friendyconsequences .consequences .
  5. 5. (c)Oboni Riskope Associates Inc.(c)Oboni Riskope Associates Inc. www.riskope.comwww.riskope.com foboni(a)riskope.com Pagefoboni(a)riskope.com Page 55 of 22 2013/04/XXof 22 2013/04/XXThis simplified ISOThis simplified ISO31000 scheme31000 schemeshows theshows theconsideration givenconsideration givento communicationto communicationand consultation atand consultation atevery stage of Riskevery stage of RiskAssessment.Assessment.CommunicationandconsultationRiskAssessmentMonitoringandreviewDocumentedrisk assessmentCommunication and consultation wereCommunication and consultation wereconsidered, but rarely truly fosteredconsidered, but rarely truly fostered
  6. 6. (c)Oboni Riskope Associates Inc.(c)Oboni Riskope Associates Inc. www.riskope.comwww.riskope.com foboni(a)riskope.com Pagefoboni(a)riskope.com Page 66 of 22 2013/04/XXof 22 2013/04/XXStandard practice CommunicationStandard practice Communicationevolution through Projects and Operationsevolution through Projects and Operations
  7. 7. (c)Oboni Riskope Associates Inc.(c)Oboni Riskope Associates Inc. www.riskope.comwww.riskope.com foboni(a)riskope.com Pagefoboni(a)riskope.com Page 77 of 22 2013/04/XXof 22 2013/04/XXDuring the same period many IndustriesDuring the same period many Industriesbecame satisfied with Risk Assessmentsbecame satisfied with Risk Assessmentsperformed following “Common Practices”performed following “Common Practices”based on "PIGs"based on "PIGs"
  8. 8. (c)Oboni Riskope Associates Inc.(c)Oboni Riskope Associates Inc. www.riskope.comwww.riskope.com foboni(a)riskope.com Pagefoboni(a)riskope.com Page 88 of 22 2013/04/XXof 22 2013/04/XXPIGs add confusion and mislead becausePIGs add confusion and mislead becausethey are arbitrary. Just ask one question:they are arbitrary. Just ask one question:How is the prioritization criteria defined?How is the prioritization criteria defined?
  9. 9. (c)Oboni Riskope Associates Inc.(c)Oboni Riskope Associates Inc. www.riskope.comwww.riskope.com foboni(a)riskope.com Pagefoboni(a)riskope.com Page 99 of 22 2013/04/XXof 22 2013/04/XXIf we look at historic and recent sets of tolerabilityIf we look at historic and recent sets of tolerabilitycriteria and real probability-consequences data...criteria and real probability-consequences data...
  10. 10. (c)Oboni Riskope Associates Inc.(c)Oboni Riskope Associates Inc. www.riskope.comwww.riskope.com foboni(a)riskope.com Pagefoboni(a)riskope.com Page 1010 of 22 2013/04/XXof 22 2013/04/XXCases will beCases will bechallengedchallengedin Courtsin Courtsof Law againstof Law againstcompaniescompaniesusing PIGs forusing PIGs fortheirtheirriskriskassessmentsassessmentsand theand theresultingresultingdecisions.decisions....and plot the PIG on top, “hazardous”...and plot the PIG on top, “hazardous”discrepancies become evident!discrepancies become evident!?
  11. 11. (c)Oboni Riskope Associates Inc.(c)Oboni Riskope Associates Inc. www.riskope.comwww.riskope.com foboni(a)riskope.com Pagefoboni(a)riskope.com Page 1111 of 22 2013/04/XXof 22 2013/04/XXUsing “frequency” instead of “probability”Using “frequency” instead of “probability”creates confusion. They are not synonyms.creates confusion. They are not synonyms.Frequency is not equal to probability in theFrequency is not equal to probability in thehigh range; and in the low range it ishigh range; and in the low range it ismisleading!misleading!
  12. 12. (c)Oboni Riskope Associates Inc.(c)Oboni Riskope Associates Inc. www.riskope.comwww.riskope.com foboni(a)riskope.com Pagefoboni(a)riskope.com Page 1212 of 22 2013/04/XXof 22 2013/04/XXPIGs also lead to the so called “overwhelmingPIGs also lead to the so called “overwhelmingsyndrome” as they lack of definition, they aresyndrome” as they lack of definition, they are“binning exercises”.“binning exercises”.PIGs can often result in too many “High” andPIGs can often result in too many “High” and“Medium” risks.“Medium” risks.Tackling, prioritizing and allotting resources to aTackling, prioritizing and allotting resources to alarge insufficiently differentiated portfolio of riskslarge insufficiently differentiated portfolio of risksgenerally ends with:generally ends with:- rejection of the results and- rejection of the results and- no remedial action!- no remedial action!
  13. 13. (c)Oboni Riskope Associates Inc.(c)Oboni Riskope Associates Inc. www.riskope.comwww.riskope.com foboni(a)riskope.com Pagefoboni(a)riskope.com Page 1313 of 22 2013/04/XXof 22 2013/04/XXInformationInformationConfusionConfusionCommon Practices and sometimes codesCommon Practices and sometimes codeshave been adding to the brewinghave been adding to the brewingconfidence crisis by delivering misleadingconfidence crisis by delivering misleadingand fuzzy information.and fuzzy information.Optimum levelof information
  14. 14. (c)Oboni Riskope Associates Inc.(c)Oboni Riskope Associates Inc. www.riskope.comwww.riskope.com foboni(a)riskope.com Pagefoboni(a)riskope.com Page 1414 of 22 2013/04/XXof 22 2013/04/XXMany of these problems can be solved by:Many of these problems can be solved by:- Developing a transparent tolerability- Developing a transparent tolerabilitythresholdthreshold- Analyzing in a comprehensive way- Analyzing in a comprehensive waypotential consequences including socialpotential consequences including socialripple effectsripple effects- Using sensible quantitative analyses and- Using sensible quantitative analyses andaccepting the inevitable uncertainties.accepting the inevitable uncertainties.
  15. 15. (c)Oboni Riskope Associates Inc.(c)Oboni Riskope Associates Inc. www.riskope.comwww.riskope.com foboni(a)riskope.com Pagefoboni(a)riskope.com Page 1515 of 22 2013/04/XXof 22 2013/04/XXIt is possible to do way better then theIt is possible to do way better then theobsolete Standard Practicesobsolete Standard Practicesand the next slide shows one exampleand the next slide shows one examplefrom a real life holistic risk assessment.from a real life holistic risk assessment.The results you will see INCLUDE ofThe results you will see INCLUDE ofcourse a specifically developedcourse a specifically developedclients tolerability threshold.clients tolerability threshold.
  16. 16. (c)Oboni Riskope Associates Inc.(c)Oboni Riskope Associates Inc. www.riskope.comwww.riskope.com foboni(a)riskope.com Pagefoboni(a)riskope.com Page 1616 of 22 2013/04/XXof 22 2013/04/XXAcme Inc.4 Divisions:A,B,C,D;Diversified3 countries;InternationalExports.Sources of ThreatsSources of ThreatsMedia VulnerabilityMedia VulnerabilityPotential Losses per ProductPotential Losses per ProductHazardous SectorsHazardous SectorsLogistic RisksLogistic Risks
  17. 17. (c)Oboni Riskope Associates Inc.(c)Oboni Riskope Associates Inc. www.riskope.comwww.riskope.com foboni(a)riskope.com Pagefoboni(a)riskope.com Page 1717 of 22 2013/04/XXof 22 2013/04/XXTwo general additional considerations:Two general additional considerations:Designers performing Risk Assessments on theirDesigners performing Risk Assessments on theirown projects/designs oftentimes constitute a conflictown projects/designs oftentimes constitute a conflictof interest that has been “picked-up” by publicof interest that has been “picked-up” by publicopinion.opinion.Without a third party perspective Risk AssessmentsWithout a third party perspective Risk Assessmentsmost likely miss big picture items.most likely miss big picture items.The process should be consultative, but too manyThe process should be consultative, but too manytimes projects developers “forget” that aspecttimes projects developers “forget” that aspectbecause of the “overwhelming syndrome” we willbecause of the “overwhelming syndrome” we willdiscussed earlier.discussed earlier.
  18. 18. (c)Oboni Riskope Associates Inc.(c)Oboni Riskope Associates Inc. www.riskope.comwww.riskope.com foboni(a)riskope.com Pagefoboni(a)riskope.com Page 1818 of 22 2013/04/XXof 22 2013/04/XXRisk Communication cannot beRisk Communication cannot bepaternalistic... but a partnershippaternalistic... but a partnership
  19. 19. (c)Oboni Riskope Associates Inc.(c)Oboni Riskope Associates Inc. www.riskope.comwww.riskope.com foboni(a)riskope.com Pagefoboni(a)riskope.com Page 1919 of 22 2013/04/XXof 22 2013/04/XXPartnering with the public requiresPartnering with the public requirescommunication, consultation andcommunication, consultation andparticipation.participation.
  20. 20. (c)Oboni Riskope Associates Inc.(c)Oboni Riskope Associates Inc. www.riskope.comwww.riskope.com foboni(a)riskope.com Pagefoboni(a)riskope.com Page 2020 of 22 2013/04/XXof 22 2013/04/XXCommunication has to be understandableCommunication has to be understandableby all partners.by all partners.
  21. 21. (c)Oboni Riskope Associates Inc.(c)Oboni Riskope Associates Inc. www.riskope.comwww.riskope.com foboni(a)riskope.com Pagefoboni(a)riskope.com Page 2121 of 22 2013/04/XXof 22 2013/04/XXTrust andTrust andCredibility mustCredibility mustbe earned bybe earned byusing modern,using modern,transparent andtransparent andunderstandableunderstandablemethodologiesmethodologieswhich includewhich includeand fosterand fostercommunication.communication.
  22. 22. (c)Oboni Riskope Associates Inc.(c)Oboni Riskope Associates Inc. www.riskope.comwww.riskope.com foboni(a)riskope.com Pagefoboni(a)riskope.com Page 2222 of 22 2013/04/XXof 22 2013/04/XXMisrepresentation has to be avoided:Misrepresentation has to be avoided:Unbiased “big picture”Unbiased “big picture”view of risks,view of risks,in depth consequencein depth consequenceandandtolerability analysestolerability analysesare necessary.are necessary.
  23. 23. (c)Oboni Riskope Associates Inc.(c)Oboni Riskope Associates Inc. www.riskope.comwww.riskope.com foboni(a)riskope.com Pagefoboni(a)riskope.com Page 2323 of 22 2013/04/XXof 22 2013/04/XXLong term is critical. If we do not evaluate itLong term is critical. If we do not evaluate itright, our children will have to bear it.right, our children will have to bear it.

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