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risk mitigation model financial - go/no-go on extra design analysis

risk mitigation model financial - go/no-go on extra design analysis

risk mitigation model financial - go/no-go on extra design analysis

I am looking for financial risk model(s) that would support go/no-go design analysis financial spending decisions during design to avoid/mitigate construction and/or operational cost risks for hard to quantify risks. Is anyone aware of tools of this nature.
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RE: risk mitigation model financial - go/no-go on extra design analysis

In my experience, the problem with this type of analysis is that if you do not want risk, the answer is always no-go. There are no negative consequences to the analyst for that conclusion, whereas there can be if go is recommended. And this type of analysis is usually commissioned by "management" that wishes to absolve itself of any responsibility for a bad outcome.

Of course these are important to do, in some cases. But it is often a sign that no one important is really interested in the project. It is just the "professional" thing to do.

RE: risk mitigation model financial - go/no-go on extra design analysis

Thanks Compositepro!

To clarify, we sometimes perform pre-installation analyses like finite element analysis or physical hydraulic modeling in special equipment applications (e.g., pumps) where there is greater risk exposure of an otherwise routine design due to abnormal various variables like use of uniquely shaped wet well/intakes, variable frequency drives, flexible foundations, especially large HP, high capacities, high dollar value construction, etc. It is not always clear when these analyses need to or should be performed (it is sometimes obvious, but often a gray area). They usually cost money that clients would rather not spend if they do not have to. I have been thinking that surely someone must have come up with an adaptable model to weigh cost of performing such an analysis to the probable likelihood and impacts of not doing such an analysis (among other factors) to assess the return on investment or financial unmitigated risk of not doing so. Ultimately, I am hoping to adapt/develop a few models to help others understand when it is quantitatively in their best interest to pay a few bucks for a special service in order to avoid future agony of not having done so.

Thank you for any insights!

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