There is no doubt that the pillars of the Fourth Industrial Revolution (for example: the Internet of Things) will play a very big role in improving and developing the performance of risk analysis techniques. In your opinion, how will this be?
My unfortunate experience across a 40-year career in various industry segments is that even when the "tools" get better, lack of real application leaves the problems in normal states. The point is that you can really never eliminate risk entirely, so no matter how accurate your probability calculations are, SOMEONE still has to decide whether that risk is "acceptable" or not. Your risk tolerance (or the computer's) may not be the same as mine.
Steven Cooke
Yes, right. I agree with you that it is impossible to permanently eliminate the risk, but it can be minimized to a lesser degree, yet we must work to change the mindset of the decision-maker in line with technological development.
Bilal Zerouali , what I meant with respect to the original question is that even if advance computational or "AI" methods connected by IoT enhance the accuracy of a prediction, if the "risk" of failure is 30.0340394 OR 30.5 +/- 0.5 it does NOT add any value to the real risk assessment. NOW, the use of IoT and AI algorithms is used (as in maintenance) to help PREDICT failures BEFORE they occur, then we start to get some value. BUT, that is not quite the same thing as a RIsk Assessment - i.e. the probability that a machine will actually fail within a certain time (or not).
Really nice question!
My strong sense is that as resources increasingly become scarce under population and economic growth the need for risk analysis and management will necessarily continue to be critical. A particularly important force behind the need I suggest is that events such as COVID 19 may increase in frequency and virulence. If so, proactive risk assessments and management will increasingly be necessary. Moreover, under changing climatic conditions, wormer oceans, increasing rainfall duration and intensity these need will increase, rather than decrease. It will also be necessary to educate the citizenship about the fact that uncertainty will increase, rather than decrease, and thus rational ex-ante managerial choices will have to be taken. Those choices will be expensive and may not provide tangible benefits until a catastrophe occurs. The reason for the increase uncertainty is that many of the new risks are inherently multifactorial and will have cascades of consequences,, rather than consisting of a single risk factor and its direct, associated consequences. Think of Covid 19: exposure to the single risk factor causes cases to occur. This is the simples cause and effect link. But what about the cascade of effects that all of us are directly or indirectly witnessing?
Hope this helps. Finally all I have said us independent of the specific of 4IR and IoT. In other words, I suggest that risk assessment and management are invariant to the actual context.
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