An intuitionistic method for the selection of a risk management approach to information technology projects

This chapter introduces students to general concepts and theoretical foundations of managing risks induced by developing and using information technology (IT risks). This chapter first provides an overview of the broad nature of IT risks. We introduce categories of IT risks to illustrate its diverse and heterogeneous causes and consequences as well as possible strategies required to balance the risks and benefits of information systems. Second, we illustrate the interdisciplinary challenges that come with managing IT risks on the most researched form of IT risk, namely IT project risks. We discuss the subjectivity of IT risks, various IT risk assessment techniques, outline the process of managing IT project risks, and introduce the dynamics of IT project risks. Third, we present five perspectives on IT risks as a fruitful lens to structure the variety of topics in IT risk research. Using these five perspectives as a framework, we present the most frequently cited IT risk research papers and theories. We conclude with an IT risk research agenda that posits worthwhile avenues for advancing the understanding and control of IT risks.

Information Technology Risks: An Interdisciplinary Challenge

Risk management in IT projects still is more an art than a science. Reliable figures about the risks of a project portfolio still depend on intuition and experience of project managers. A central challenge is to aggregate the risks of a project into a single risk measure that makes it easy for the senior management to compare projects and see which projects need their attention. We first analyze different approaches to aggregate risks and compare them in terms of theoretical foundation and practical usability. In particular we explore the applicability of the well-known financial risk figure Conditional Value-at-Risk (CVaR). Using data from 110 IT projects we demonstrate that the CVaR offers a well-defined risk measure that provides clear information for senior management decisionmaking. Since the CVaR is flexible concerning its confidence level it can be changed to fit the management’s risk aversion. Finally, we derive suggestions for risk management to make the calculated CVaR even more reliable. In sum, we show that well-defined risk measures can be transferred to the domain of project risk management if companies establish central risk reporting.

Calculating the conditional value at risk in is projects: towards a single measure of project risk

Risk management in IT projects still is more an art than a science. Reliable figures about the risks of a project portfolio still depend on intuition and experience of project managers. A central challenge is to aggregate the risks of a project into a single risk measure that makes it easy for the senior management to compare projects and see which projects need their attention. We first analyze different approaches to aggregate risks and compare them in terms of theoretical foundation and practical usability. In particular we explore the applicability of the well-known financial risk figure Conditional Value-at-Risk (CVaR). Using data from 110 IT projects we demonstrate that the CVaR offers a well-defined risk measure that provides clear information for senior management decision-making. Since the CVaR is flexible concerning its confidence level it can be changed to fit the management?s risk aversion. Finally, we derive suggestions for risk management to make the calculated CVaR even more reliable. In sum, we show that well-defined risk measures can be transferred to the domain of project risk management if companies establish central risk reporting.

Calculating the conditional value at risk in IS projects

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Calculating the conditional value at risk in is projects: towards a single measure of project risk

Calculating the conditional value at risk in IS projects