Risk Management and Decision Making Glossary

Action Research.  Action research is a set of activities in which a group of people work toward an agreed goal, based on a process of deliberate planning, acting, observing and reflecting on their work.

Adaptive Toolbox.  Adaptive toolbox describes the collection of cognitive mechanisms that evolution has built into the human mind for specific domains of inference and reasoning, including decision-making heuristics.

Autonomic.  The term "autonomic" designates a kind of feedback control that is built-in and rigid in a sense that it does the same thing every time.

Bounded Rationality.  Bounded rationality is based on behavioural notions and upon observations of the ways in which decisions are actually taken in practice.

Call for action.  A call for action at the tail (source) of a causal link is intended to result in some form of management or control action at the head (sink) of that link.

CATWOE.  CATWOE is a mnemonic of the six crucial characteristics which should be included in a well formulated root definition used in Soft Systems Methodology: customer,actor,transformation process,weltanshauung,owner,environmental constraints

Causal loop diagram.  A causal loop diagram is a convenient way of representing the principal feedback loops and related causal relationships relevant to a particular problem situation, without distinguishing between the nature of the interconnected variables.

Causality (causal loop diagram).  In a causal loop diagram, the influence of one variable on another is causality.

Causality (cognitive or concept map).  Causality or causal relationships are represented by arrows in cognitive maps or concept maps, where each arrow means 'leads to '.

Choke point.  A choke point is a leverage point that can work against us.

Cognition.  Cognition is the faculty of knowing, perceiving and conceiving (conceptualising).

Cognitive Content.  Cognitive content is a term used to describe the extent to which a cause map represents phenomenological beliefs and causal notions within an interlinked, systemic pattern.

Cognitive Map.  A cognitive map is a personal mind map or a mapping of the thoughts an individual has about a particular situation or problem of interest.

Cognitive Mapping.  Cognitive mapping is the process of constructing a cognitive map.

Cognitive Mapping Software.  Cognitive mapping software is often used as an aid to in the cognitive mapping process.

Complexity.  Complexity describes that which comprises myriad parts, or which is complicated in nature.

Complexity Index.  The Complexity Index is used to indicate inherent complexity of a problem, or class of problems.

Complexity Theory.  Complexity theory begins by acknowledging the interrelated nature of things as well as emergence, where the whole is experienced as greater than the sum of the parts.

Concept.  In general usage, a concept is a general notion. In concept mapping, a concept is also an idea or general notion.

Concept Map.  A concept map is a mind map, which contains the perspectives and inputs of several individuals.

Concept Mapping.  Concept mapping is the process of constructing a concept map.

Concept Mapping Software.  Concept mapping software is often used as an aid to in the concept mapping process.

Conflicting Link.  Conflict relationships are a special case of the connotative relationship, but where the concepts at the ends of each line cannot co-exist without conflict, or a state of stress being created.

Connotative Link.  A link where causality may act in either direction at different times or under varying circumstances is known as a connotative link.

Consequence.  Consequence is the outcome of an event or situation expressed qualitatively or quantitatively, being a loss, injury, disadvantage or gain.

Context.  The context of a problem consists of the strategic context, the organisational context and the risk-management context.

Correlation.  A correlation is a statistical device used to indicate the extent to which one measure can be linked to another.

Cybernetic.  Norbert Wiener’s word for autonomic feedback control.

Decision (decision event).  A decision is made, or a decision event occurs, when the decision-maker (generally a single individual) surveys a known and fixed set of alternatives, weighs the likely consequences of choosing each, and makes a choice.

Decision event model of decision-making.  The decision event model of decision-making emphasises concurrent evaluation of multiple options.

Delay.  A situation in which an influence from a variable A to another variable B does not take effect immediately.

Domains of Action.  These are the areas within which managers or decision makers can act or exercise control.

Double loop learning.  Double loop learning occurs when mismatches or errors are corrected by first examining and altering the governing variables and then taking action.

Ecological Validity.  Ecological validity describes the situation where recognition-primed decision-making, based on relevant mental shortcuts or heuristics is highly effective in a specific environment.

Emergence (emergent properties).  Emergent properties are properties exhibited by a complete (hooked-up) system that cannot be exhibited by the parts of the system in isolation.

Entire invariant paradigm.  A principle that not only holds for all known examples in a class of systems but also occurs with the same details in every case.

Epistemology.  Epistemology is a theory concerning means by which we may have and express knowledge of the world.

Espoused Theories.  Espoused theories are those that an individual claims to follow.

Facilitator / Elicitor.  Functioning as group facilitator and knowledge elicitor, this person pays constant attention to group process, the roles of individuals in the group, and the business of drawing out knowledge and insights from the group.

Feedback.  Feedback occurs when part or all of the output of a system re-enters as the input.

Flow.  See rate.

Fuzzy Concept Map.  See Cognitive Map and Concept Map.

Fuzzy Logic.  Fuzzy logic is a superset of conventional (Boolean) logic that has been extended to multi-valued sets, to handle the concept of partial truth, that is, truth values between completely true and completely false.

Gatekeeper.  Gatekeepers in organisations are those who directly control a situation.

Groupthink.  Groupthink is a strong concurrence-seeking tendency that interferes with effective group decision making.

Handbooks and Guides.  Risk management handbooks give guidelines on the application of risk management standards to particular applications.

Hazard.  A hazard is a source of risk.

Heuristic.  A heuristic is a higher order psychological adaptation, a useful mental shortcut, an approximation, or a rule-of-thumb, specialised for certain classes of problem, for guiding search and enabling adaptive decision-making.

Hierarchy.  Hierarchy is the principle according to which entities meaningfully treated as wholes are built up of smaller entities which are themselves wholes.

Human Activity System.  A notional purposive system which expresses some purposeful human activity, activity which could in principle be found in the real world.

Influence Diagram.  An influence diagram is a list of factors in a problem, together with arrows and signs showing the relationship between them.

Knowledge.  The simple dictionary definition of knowledge, that is, knowing or familiarity gained by experience, is not sufficient for use in risk management and decision making. It is not data, nor information. It exists only in human minds and cannot be stored directly or completely in computers or in any other medium.

Learning.  Learning occurs when an actor in problem situation invents, then produces a solution.

Level.  See stock.

Leverage.  Leverage is built on the notion that small, well focused actions can sometimes produce significant, enduring improvements, if they’re in the right place.

Leverage point.  A leverage point is where a small difference can make a large difference.

Mental Model.  Mental model refers to both the semi-permanent 'tacit maps' of the world which people hold in their long-term memory, and the short-term perceptions which people build up as part of their everyday reasoning processes

Metacognition.  Metacognition is seeing inside our own thought processes: the process of metacognition means thinking about thinking.

Mind Map.  A mind map is a mapping of thoughts.

Mind Mapping.  Mind mapping is the process of constructing a mind map.

Mind Mapping Software.  Mind mapping software is often used as an aid to in the mind mapping process.

Modeller / reflector.  The modeller (or reflector) focuses not at all on group processes but rather on the model that is being explicitly formulated by the facilitator and the group.

Modelling challenge.  The modelling challenge involves understanding why computational models do not work in a particular problem, and deveoping real insights into complex problems.

Modelling gatekeeper.  The role of the modelling gatekeeper is filled by a person within, or related to, the client group who carries internal responsibility for the project, helps frame the problem, identifies participants, works with the modelling support team to structure the sessions, and participates as a member of the group.

Naturalistic Decision-Making.  Naturalistic decision-making attempts to explain how real decision-makers formulate decisions.

Negative Feedback.  Negative feedback is a form of circular causality which characteristically tends to produce a stable reaction.

Opportunities.  Opportunities is the third step of a SWOT analysis.

Organisational Context.  The organisational context includes the way the organisation is structured and how it operates.

Organisational learning.  In an organisational context, learning may not be said to occur if someone (acting for the organisation) discovers or invents a solution to a problem. Learning occurs when the problem is actually produced.

Parameters.  Parameters are factors that define an alternative and determine its behaviour.

Participatory Management.  Participatory management encourages involvement of stakeholders at all levels in analysis of problems, development of strategies and implementation.

Polarity.  In a causal loop diagram, concept map or influence diagram, signs adjacent to the arrows are used to indicate polarity.

Policy.  A policy is established as guiding rule(s) applied to a point in a system.

Positive feedback.  Positive feedback is a form of circular causality, which acts as a growth-generating mechanism.

Pressure point.  A pressure point is a point at which a change intervention is applied.

Process coach.  The process coach focuses not at all on content but rather on the dynamics of individuals and sub-groups within the group.

Project Risk Management.  Project risk management provides processes to identify, analyse, and respond to project risk.

Rate.  A rate or flow in a system dynamics causes the value of a stock or level to change.

Reasonable Person.  A reasonable person is an intelligent, non-expert person.

Recorder.  Writing down or sketching the important parts of the group proceedings is the task of the recorder.

Responsibilities Assignment Matrix.  A responsibilities assignment matrix is a device for recording who is responsible for what.

Risk.  Risk is the chance of something happening that will have an impact upon objectives.

Risk Acceptance.  Risk acceptance describes an informed decision to accept the consequences and likelihood of a particular risk.

Risk Analysis.  Risk analysis forms part of the risk management process. It involves determining the likelihood and consequences of each risk.

Risk Avoidance.  Risk acceptance is used in risk management to describe an informed decision not to become involved in activities that lead to the possibility of the risk being realised.

Risk Consequence.  See consequence

Risk Evaluation.  Risk evaluation is used in risk management to rank risks against nominated criteria and to set risk priorities.

Risk Exposure.  A risk exposure is a source of risk.

Risk Factor.  Risk factor is a convenient artifice created by the combining of likelihood and consequence.

Risk Identification.  Risk identification answers the questions: What can happen? How can it happen?

Risk-Management Context.  The risk-management context includes the nature of operational, technical and regulatory frameworks and the nature of what is being done.

Risk Reduction.  Risk acceptance is used in risk management to describe the application of appropriate techniques to reduce the likelihood of an occurrence, its consequences, or both..

Risk Transfer.  Risk acceptance is used in risk management to describe the shifting of the burden of the risk to another party.

Risk Treatment.  Risk treatment describes the part of risk management in which decisions are made about how to treat risks that have been previously identified and prioritised.

Root Defintion.  A root definition is a concise, tight construction of a human activity system which states what the system is.

Satisficing.  Satisficing is a method for making a choice from a set of alternatives encountered sequentially when one does not know much about the possibilities ahead of time.

Schema.  A schema (plural schemata) is a human mental construct which the human brain understands the world.

Shifting Feedback Loop Dominance.  Shifting feedback loop dominance is used to describe a system with two or more feedback loops, with at least one having negative feedback and one having positive feedback.

Single loop learning.  Single loop learning is a term borrowed from electrical engineering or cybernetics where, for example, a thermostat is defined as a single-loop learner.

Situation Awareness.  Decision-makers are drawn to certain situational cues and not to others because of their situation awareness.

Stakeholder.  A stakeholder is a person involved in, or affected by, the process of developing an organisational change or strategic intervention, or the outcome of that intervention.

Standards.  Risk management standards define processes that can be used for the assessment and control of risks. These standards have been developed by national standards bodies and other organisations with a vital interest in risk management.

State Variables.  State variables are a collection of variables that we choose to monitor to inform us about the status of a system.

Stock.  A stock or level is a simple conceptual device used in a system dynamics to represent parts of the system in which accumulation occurs.

Strategic Context.  The strategic context includes the nature of the environment in which an organisation operators or project will be delivered.

Strategic Management.  Strategic management describes an ongoing process that is used to determine the long-term goals (or strategy) of an organisation, and assess its effectiveness against these goals.

Strategic Planning.  Strategic planning refers to the management of the disposition of resources, application of effort and creating conditions for the preferred way of doing business, including managing risk.

Strategy.  Strategy describes management of the distribution of respources and creating conditions for the preferred way of doing business.

Strengths.  Strengths is the first step of a SWOT analysis.

Strengths, Weaknesses, Opportunities and Threats.  See SWOT.

Strengths, Weaknesses, Opportunities and Threats Analysis.  See SWOT Analysis.

SWOT (Strengths, Weaknesses, Opportunities and Threats).  SWOT (Strengths, Weaknesses, Opportunities and Threats) is a commonly used name for the decision making tool known as "SWOT Analysis".

SWOT Analysis (Strengths, Weaknesses, Opportunities and Threats Analysis).  SWOT Analysis (Strengths, Weaknesses, Opportunities, Threats Analysis) is a tool commonly used to plan future activiities to maximise their positive impact on an individual or organisation.

SWOT Software.  A SWOT software tool can provide a convenient way of capturing the information generated in a SWOT analysis, and prompting users for appropriate information.

Sysrep.  A sysrep or a precise representation of a system is a truth assertion we hold individually as part of our own personal knowledge.

System Dynamics (System Dynamics Modelling).  System dynamics is a tool intended to enable our thinking about how feedback, delay, shifting feedback loop dominance, and non-linearity contribute to systemic behaviour.

Systemic Structure.  Systemic structure describes the web of interrelationships between factors at play which shape the dynamic behaviour of a problem situation.

Systemicity.  Systemicity describes the complex, dynamic behaviour exhibited by systems, or systems-of-systems

Systems Thinking.  Systems thinking is an epistemology which is based upon the ideas of emergence, hierarchy, communication and control as characteristics of system

Theories-in-use.  Theories-in-use are theories of action that can be inferred from the way individuals act.

Threats.  Threats is the fourth step of a SWOT analysis.

Variable.  A variable is a measurable quantity one chooses to monitor as the system under investigation operates.

Weaknesses.  Weaknesses is the first step of a SWOT analysis.

Weltanschauung.  The German word weltanschauung stresses the importance of accommodating varying perspectives about a problem.

Wicked Problems.  ‘Wicked’ is used to characterise problems, which are complex, dynamic and systemic.

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