Okay, let's have a look at risk management in practice.

And what I want to do is to start with some basic concepts,

then focus on two difficult areas in the risk process.

So, I guess if I asked you to define the word risk,

you would have some idea of what it meant.

We might not have a formal definition that we could quote,

but we all have something in our minds when we hear the word risk.

This is what we think, and maybe you think of things like this,

maybe you feel like this little guy, facing some big ugly challenge

that you know is just going to squash you flat.

Maybe you feel like this guy.

This is a real job in North Korea,

and his job is to hold the target for other people to shoot at.

Sometimes project managers have the target here.

We feel like everybody is shooting at us in our job.

Or maybe you just know there's something nasty out there, waiting for you.

And maybe that's what you think of when you think of the word risk.

Well that's partly true, but it's not the whole truth.

Risk is not the same as uncertainty.

Risk is related to uncertainty, but they're different.

So all risks are uncertain, but not all uncertainties are risks.

If you have a risk register or a risk list,

you don't have a million items in it, or you shouldn't.

You don't even probably have a thousand items in it,

you have a smaller number.

Although there are millions of uncertainties in the world.

So how do we decide which uncertainties we're going to call risk?

And write them down and put them in our risk register

and decide to do something about them.