The world is becoming more volatile, uncertain, complex and ambiguous. In certain literature this paradigm has been coined the VUCA world exemplifying a riskier environment to live, work and do business. The principles of risk assessment are based on identifying possible risk events and estimate the impact and probability of occurrence. A risk mitigation strategy is based on the risk coefficient derived from this assumption. However, this procedure has flaws that might deprive decision makers and risk analysts from noticing risk events that have low probability and high impact attributes. Such events, called fat tail risk events, are arguably becoming more frequent due to the VUCA world and need managerial responses. This lecture explains how and why the conventional risk assessment approach is flawed both in context of empirical evidences and subjective estimates Furthermore, the VUCA meter is introduced. The VUCA meter is a normative approach designed to isolate fat tail risk events (black swans).
Dr Thordur Vikingur Fridgeirsson is a well-known person in the Icelandic academic- and business sectors as a business engineer. Originally a successful manager and a management consultant in the private sector that joined the academia in 2006 at Reykjavik University.At Reykjavik University he founded the research hub CORDA (Center of Risk and Decision Analysis). This active research hub is a melt pot of theories and practices from engineering science and social science. The main research and work of Thordur Vikingur is on projects addressing project management and risk assessment in context of human behavior and the projectification of the business sectors and the public domain.Thordur Vikingur has written three popular textbooks on management and several academic articles. His research and teaching activities include decision theories, projectification and risk theories.
The seminar will be held in English
Major information: Francesco Maria Barbini (francesco.barbini@unibo.it)