[Script Info]
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[Events]
Format: Layer, Start, End, Style, Name, MarginL, MarginR, MarginV, Effect, Text
Dialogue: 0,0:00:00.50,0:00:04.43,Default,,0000,0000,0000,,Okay, let's have a look at\Nrisk management in practice
Dialogue: 0,0:00:04.46,0:00:08.47,Default,,0000,0000,0000,,And what I want to do\Nis to start with some basic concepts
Dialogue: 0,0:00:08.48,0:00:14.02,Default,,0000,0000,0000,,then focus on two difficult areas\Nin the risk process
Dialogue: 0,0:00:14.24,0:00:19.16,Default,,0000,0000,0000,,So, I guess if I asked you\Nto define the word 'risk'
Dialogue: 0,0:00:19.17,0:00:22.95,Default,,0000,0000,0000,,you would have some ideas\Nof what it meant
Dialogue: 0,0:00:22.97,0:00:26.48,Default,,0000,0000,0000,,We might not have a formal definition\Nthat we could quote,
Dialogue: 0,0:00:26.48,0:00:30.25,Default,,0000,0000,0000,,but we all have something in our minds\Nwhen we hear the word 'risk'
Dialogue: 0,0:00:30.27,0:00:33.97,Default,,0000,0000,0000,,This is what we think,\Nand maybe you think of things like this
Dialogue: 0,0:00:34.23,0:00:38.53,Default,,0000,0000,0000,,Maybe you feel like this little guy,\Nfacing some big ugly challenge
Dialogue: 0,0:00:38.53,0:00:41.79,Default,,0000,0000,0000,,that you know is just going to\Nsquash you flat.
Dialogue: 0,0:00:42.07,0:00:43.77,Default,,0000,0000,0000,,Maybe you feel like this guy.
Dialogue: 0,0:00:44.02,0:00:46.49,Default,,0000,0000,0000,,This is a real job in North Korea,
Dialogue: 0,0:00:47.77,0:00:51.37,Default,,0000,0000,0000,,and his job is to hold the target\Nfor other people to shoot at
Dialogue: 0,0:00:51.50,0:00:53.98,Default,,0000,0000,0000,,Sometimes project managers\Nhave the target here
Dialogue: 0,0:00:54.29,0:00:56.91,Default,,0000,0000,0000,,We feel like everybody is shooting at us\Nin our job
Dialogue: 0,0:00:57.76,0:01:01.99,Default,,0000,0000,0000,,Or maybe you just know there's something\Nnasty out there, waiting to get you
Dialogue: 0,0:01:02.47,0:01:05.70,Default,,0000,0000,0000,,And maybe that's what you think of\Nwhen you think of the word 'risk'
Dialogue: 0,0:01:06.36,0:01:09.57,Default,,0000,0000,0000,,Well that's partly true\Nbut it's not the whole truth.
Dialogue: 0,0:01:10.19,0:01:13.62,Default,,0000,0000,0000,,Risk is not the same\Nas uncertainty.
Dialogue: 0,0:01:14.22,0:01:16.96,Default,,0000,0000,0000,,Risk is related to uncertainty\Nbut they're different.
Dialogue: 0,0:01:17.67,0:01:23.83,Default,,0000,0000,0000,,So all risks are uncertain\Nbut not all uncertainties are risks.
Dialogue: 0,0:01:24.65,0:01:27.59,Default,,0000,0000,0000,,If you have a risk register\Nor a risk list,
Dialogue: 0,0:01:27.94,0:01:31.44,Default,,0000,0000,0000,,you don't have a million items in it,\Nor you shouldn't.
Dialogue: 0,0:01:31.96,0:01:34.51,Default,,0000,0000,0000,,You don't even probably have\Na thousand items in it,
Dialogue: 0,0:01:34.51,0:01:35.79,Default,,0000,0000,0000,,you have a smaller number.
Dialogue: 0,0:01:36.71,0:01:40.01,Default,,0000,0000,0000,,Although there are millions\Nof uncertainties in the world.
Dialogue: 0,0:01:40.40,0:01:44.31,Default,,0000,0000,0000,,So how do we decide which uncertainties\Nwe're going to call 'risk'?
Dialogue: 0,0:01:44.68,0:01:47.28,Default,,0000,0000,0000,,And write them down \Nand put them in our risk register
Dialogue: 0,0:01:47.55,0:01:50.06,Default,,0000,0000,0000,,and decide to do something about them.
Dialogue: 0,0:01:50.48,0:01:56.36,Default,,0000,0000,0000,,Clearly 'risk' is a subset\Nof uncertainties, but which subset?
Dialogue: 0,0:01:56.94,0:01:58.13,Default,,0000,0000,0000,,How do you know?
Dialogue: 0,0:01:58.80,0:02:02.95,Default,,0000,0000,0000,,I think it's very simple to separate\Nrisk and uncertainty.
Dialogue: 0,0:02:03.20,0:02:05.27,Default,,0000,0000,0000,,And I used 3 English words,
Dialogue: 0,0:02:05.42,0:02:10.02,Default,,0000,0000,0000,,these words here,\N'risk is uncertainty that matters."
Dialogue: 0,0:02:11.50,0:02:14.78,Default,,0000,0000,0000,,Because most of the\Nuncertainties in the world don't matter.
Dialogue: 0,0:02:15.56,0:02:19.01,Default,,0000,0000,0000,,We don't care if it's going to rain\Nin London tomorrow afternoon.
Dialogue: 0,0:02:19.40,0:02:23.78,Default,,0000,0000,0000,,It might, it might not,\Nit's irrelevant, it doesn't matter.
Dialogue: 0,0:02:24.50,0:02:26.95,Default,,0000,0000,0000,,We don't care what the \Nexchange rate will be
Dialogue: 0,0:02:26.95,0:02:30.70,Default,,0000,0000,0000,,if it's between the Russian Ruble \Nand the Chinese Yen in 2020.
Dialogue: 0,0:02:30.70,0:02:32.39,Default,,0000,0000,0000,,It doesn't matter to us.
Dialogue: 0,0:02:32.89,0:02:35.12,Default,,0000,0000,0000,,But there are things on our projects,
Dialogue: 0,0:02:35.43,0:02:37.12,Default,,0000,0000,0000,,and things in our families,
Dialogue: 0,0:02:37.27,0:02:38.87,Default,,0000,0000,0000,,and things in our country,
Dialogue: 0,0:02:38.98,0:02:41.45,Default,,0000,0000,0000,,which are uncertain which do matter to us.
Dialogue: 0,0:02:42.20,0:02:45.34,Default,,0000,0000,0000,,If it's an uncertainty that matters, \Nit's a risk.
Dialogue: 0,0:02:46.19,0:02:49.99,Default,,0000,0000,0000,,So here's another question,\Nhow do you know what matters?
Dialogue: 0,0:02:50.75,0:02:53.40,Default,,0000,0000,0000,,In your projects, \Nwhat are the things that matter?
Dialogue: 0,0:02:54.08,0:02:57.88,Default,,0000,0000,0000,,The things that matter in our projects\Nare our objectives.
Dialogue: 0,0:02:58.53,0:03:02.22,Default,,0000,0000,0000,,So we must always connect uncertainty\Nwith objectives,
Dialogue: 0,0:03:02.99,0:03:05.63,Default,,0000,0000,0000,,in order to find the risks.
Dialogue: 0,0:03:06.00,0:03:08.36,Default,,0000,0000,0000,,And if we look at \Nsome definitions of risk,
Dialogue: 0,0:03:08.36,0:03:11.40,Default,,0000,0000,0000,,this is the ISO standard that I mentioned,
Dialogue: 0,0:03:11.44,0:03:13.80,Default,,0000,0000,0000,,it connects those words very simply.
Dialogue: 0,0:03:13.80,0:03:17.56,Default,,0000,0000,0000,,Risk is the effect of uncertainty\Non objectives.
Dialogue: 0,0:03:18.45,0:03:21.20,Default,,0000,0000,0000,,And we might look at another definition\Nfrom the UK,
Dialogue: 0,0:03:21.39,0:03:23.92,Default,,0000,0000,0000,,from our association \Nwith project management,
Dialogue: 0,0:03:24.14,0:03:28.13,Default,,0000,0000,0000,,it says the same thing that risk\Nis an uncertain event
Dialogue: 0,0:03:28.15,0:03:32.21,Default,,0000,0000,0000,,or a set of circumstances, \Nwhich is uncertain,
Dialogue: 0,0:03:32.21,0:03:35.37,Default,,0000,0000,0000,,but it matters because should it occur,
Dialogue: 0,0:03:35.37,0:03:38.59,Default,,0000,0000,0000,,it will have an effect on achievement of objectives.
Dialogue: 0,0:03:38.60,0:03:40.55,Default,,0000,0000,0000,,Uncertainty that matters.
Dialogue: 0,0:03:40.87,0:03:44.32,Default,,0000,0000,0000,,So we should be looking \Nin our risk register for two things.
Dialogue: 0,0:03:44.70,0:03:48.80,Default,,0000,0000,0000,,Is it uncertain? We don't want \Nproblems in our risk register.
Dialogue: 0,0:03:49.18,0:03:52.11,Default,,0000,0000,0000,,We don't want issues in the risk register.
Dialogue: 0,0:03:52.11,0:03:55.02,Default,,0000,0000,0000,,We don't want constraints or requirements.
Dialogue: 0,0:03:55.29,0:03:59.63,Default,,0000,0000,0000,,These things are certain,\Nwhat we want are uncertainties,
Dialogue: 0,0:03:59.72,0:04:02.24,Default,,0000,0000,0000,,something that might happen\Nor might not happen.
Dialogue: 0,0:04:03.08,0:04:06.77,Default,,0000,0000,0000,,But the other important question for our\Nrisk register is
Dialogue: 0,0:04:06.77,0:04:08.37,Default,,0000,0000,0000,,does it matter?
Dialogue: 0,0:04:08.44,0:04:11.74,Default,,0000,0000,0000,,Which objective would be effective \Nif this thing happened?
Dialogue: 0,0:04:13.30,0:04:15.81,Default,,0000,0000,0000,,And then when we want to see\Nhow big the risk is,
Dialogue: 0,0:04:16.16,0:04:18.32,Default,,0000,0000,0000,,we can ask those two questions:
Dialogue: 0,0:04:18.34,0:04:19.77,Default,,0000,0000,0000,,how uncertain is it,
Dialogue: 0,0:04:19.98,0:04:22.10,Default,,0000,0000,0000,,and how much does it matter?
Dialogue: 0,0:04:22.13,0:04:24.50,Default,,0000,0000,0000,,And that will tell us how big the risk is.
Dialogue: 0,0:04:24.56,0:04:27.04,Default,,0000,0000,0000,,So, this idea of uncertainty that matters
Dialogue: 0,0:04:27.28,0:04:30.71,Default,,0000,0000,0000,,then develops into something which is useful
Dialogue: 0,0:04:30.71,0:04:33.38,Default,,0000,0000,0000,,by linking uncertainty to our objectives.