About the New Methodology and XAI-Based Software Toolkit for Risk Assessment

Abstract

There are different approaches in different areas of what the risk is. ISO 31000 risk management standards describe risk as the effect of uncertainty on objectives. Many existing risk assessment procedures are based on the assumption that risk is the amount of any damage or loss multiplied by the probability of an event that could cause the damage. We are proposing a new risk approach, based on Hillson’s positive risk philosophy, that risk is not just a threat but also a composition of new opportunities, efforts that need to be put in, and uncertainty. For this approach, we composed a risk formula and a methodology based on that formula. A prototypical software tool was developed, and an experiment was performed using this tool to evaluate the risk of several interconnected projects and validate the developed risk assessment methodology. It should be mentioned that, in the methodology, the decision-making process is performed traceably; therefore, it can be stated that it has explainable artificial intelligence (XAI) traits.