Reality Bites: Tips for Improving Your Risk Assessments

摘要

Risk assessment is an area of vital interest to water utilities, since risk impacts virtually every aspect of utility management, from financial returns to infrastructure performance to water supplies. While an array of tools has arisen to help assess and manage risk, many fundamental challenges remain. These challenges must be confronted head-on if we are to improve our risk assessments. Central among those challenges is to understand the crucial role of human judgment in risk assessment, and continually work to improve those judgments and the decisions that flow from them. The physicist Richard Feynman, reviewing lapses in human judgment connected to the space shuttle Challenger, observed “reality must take precedence over public relations, for nature cannot be fooled.” In other words, reality bites – so we must well understand risk, and the influence of human judgment on risk assessment, if we are not to be bitten. Heuristics theory is a model of human judgment and perception made famous by 2002 Nobel Prize winner Daniel Kahneman, and his associate Amos Tversky. Heuristics theory can help us leverage quantitative risk analysis by making the role of human judgments manifest, and by giving us techniques to reduce bias in those judgments. This paper briefly reviews the evolution of risk assessment practice, and proposes practical techniques to strengthen the application of some popular quantitative risk assessment tools, with a focus on harnessing the power of heuristics.