Introduction
Opportunity:
An opportunity can be defined as a situation where the probability of occurrence of a desired incident is very high. The probability levels are decided after studying the requirements and environmental variables.
Or we can say that Opportunities are external conditions that are helpful to achieving the objective.
Risk:
Risk is a concept that denotes a potential negative impact to an asset or some characteristic of value that may arise from some present process or future event. In everyday usage, risk is often used synonymously with the probability of a known loss. Paradoxically, a probable loss can be uncertain and relative in an individual event while having a certainty in the aggregate of multiple events (see risk vs. uncertainty below).
Risk is the possibility of an event occurring that will have an impact on the achievement of objectives. Risk is measured in terms of impact and likelihood.
There are many more and less precise definitions of risk; they depend on specific applications and situational contexts. It can be assessed qualitatively or quantitatively.
Qualitatively, risk is considered proportional to the expected losses which can be caused by an event and to the probability of this event. The harsher the loss and the more likely the event, the greater the overall risk.
Frequently in the subject matter literature, risk is defined in pseudo-formal forms where the components of the definition are vague and ill-defined, for example, risk is considered as an indicator of threat, or depends on threats, vulnerability, impact and uncertainty.
In engineering, the quantitative engineering definition of risk is:
Risk = Probability of an accident X losses per accident.
Wasted Opportunities Analysis:
Wasted opportunity analysis is singularly aimed at finding out How can we Exploit each Opportunity?
This process includes certain steps.
➢ Defining the objectives.
➢ Identifying the opportunities.
➢ Measuring wasted opportunities.
➢ Root Cause Analysis of Wasted Opportunities.
➢ Deriving guidelines to avoid wastage of opportunities in the future.
Avoidable Risk Analysis:
Avoidable risk analysis is more complicated than wasted opportunity analysis as it includes a broader spectrum of variables.
The steps include,
➢ Defining/redefining risk parameters.
➢ Analysis to find out why a certain parameter is a risk.
➢ Identifying the opportunities to avoid risks.
➢ Identifying uncontrollable variables driving risk forces.
➢ Identifying long term controllable variables driving risk forces.
➢ Identifying short term controllable variables driving risk forces.
➢ Deriving immediate and internal action plans to check short term controllable forces.
➢ Suggesting fundamental and internal/external process redesign guidelines to check long term controllable risk forces.
Wasted Opportunities and Avoidable Risk Analysis:
The WOAR analysis is an ongoing process, which concentrates on different levels of same risks and opportunities, or on completely different opportunities and risks.
WO and AR analysis are conducted separately and the outcomes are combined to obtain a common set of guidelines to increase the percentage of successful achievement of the objective.
Cheers that we met,
Anij Janardhanan
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