You are in the audience at a small, intimate theatre, watching a magic show. The magician hands a pack of cards to a random member of the audience, asks him to check that it's an ordinary pack, and would he please give it a shuffle. The magician turns to another member of the audience and asks her to name a card at random. "Ace of Hearts," she says. The magician covers his eyes, reaches out to the pack of cards, and after some fumbling around he pulls out a card. The question to you is what is the probability of the card being the Ace of Hearts?

Read this very interesting debate touching on risk management and the effects of mathematical thinking mixed with human factor common sense.

I just spent the last two days facilitating a review team analyzing risks of a proposal. Two days of identifying risks in over a dozen areas ranging from program management to technical solutions and cost, yet no examination into the probability of the risk occurrence. The final assessment is the essentially the result of subjective opinions and the reviewers' "gut-feel," which is why only very seasoned veterans compose the review team!

With the skill-set of the employees, experience of the management team, and lessons learned from past performance, shouldn't a program be evaluated to be in a better state than perhaps a "green" program with no established means of handling similarly identified risks?

Our company is trying to instill more process and mathematical formulas into these reviews in order to come up with a better way to derive the overall program risk. I just do not see how that is possible without losing a lot of the human factor input in the assessment.