The problem of decision making under doubt is described. The concept of immediate probabilities is introduced. It is seen as a modification of typical probabilistic knowledge with information about the payoffs, mediated through dispositional information (optimism/pessimism), resulting in a modified formulation of an agents perception of the probabilities in effect in the current decision. We use the Dempster rule of combination to help obtain an expression for these probabilities. We show how immediate probabilities allows us to explain the Allais paradox. A number of properties of these probabilities are described. The strategic use of these probabilities are explored as a means for effecting other people's decisions.
Purpose Unforeseen crises can result in significant losses for unprepared organizations. A paradigm for risk management discloses that threats can lead to crisis events which can have immense negative consequences. Analyzing risks and making appropriate decisions regarding them is very challenging but crucial. Emerging developments in organizational risk reveal similar characteristics among evolving threats. Effective risk management requires insightful leadership and is essential for an organization to achieve security. The paper aims to discuss these issues. Design/methodology/approach The authors explore some emerging developments in organizational risk, by highlighting evolving concerns and identifying their common characteristics. The authors then discuss key resources and recommend approaches in managing organizational risk. Findings Evolving concerns in organizational risk include: infrastructure risk, enterprise risk, information security risk, supply chain risk and new technologies risk. The most troubling threats to an organization tend to have some risk characteristics in common. These attributes are useful in identifying further threats. Originality/value Managing risk is an enormous challenge that all organizations encounter. Understanding the common characteristics of evolving risks that are currently under scrutiny can provide insight into identifying further threats to organizations. With these common characteristics understood, the primary resources of solid leadership, risk analytics and professional business continuity management can aid in the recognition of additional obscured but growing risks and be beneficial in providing security for an organization.
This paper examines the problem of selecting an alternative in situations in which there exists uncertainty in our knowledge of the state of the world. We show how the ordered weighted averaging aggregation operators provide a unifying approach to selecting alternatives under uncertainty. In particular, we see how these operators provide a type of probability associated with our degree of optimism. We also show how the Dempster-Shafer belief structure provides a general framework for representing the information a decision maker has regarding relevant events. We then propose a methodology for decision making under uncertainty, integrating the ordered weighted averaging aggregation operators and the Dempster-Shafer belief structure. The proposed methodology is applied to a real world case involving risk management at one of the nation’s largest banks.
Risk management decisions are among the most conceptually difficult ones faced by managers. Financial institutions depend upon their operations and may incur considerable losses if those operations are interrupted. We participated in the development and implementation of an operations risk management program in one of the nation's largest banks. We developed a methodology, based upon decision analysis, as a framework for making risk management decisions. The bank implemented an ongoing corporate-wide contingency-planning program for all operation's services, using the risk management methodology to analyze operational risks in a probabilistic environment. This program, implemented prior to regulatory mandates, remains an industry leader for over a decade.
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.
hi@scite.ai
10624 S. Eastern Ave., Ste. A-614
Henderson, NV 89052, USA
Copyright © 2024 scite LLC. All rights reserved.
Made with 💙 for researchers
Part of the Research Solutions Family.