Risk Monetization: Converting Threats and Opportunities into Impact on Project Value, 1st Edition (Paperback) book cover

Risk Monetization

Converting Threats and Opportunities into Impact on Project Value, 1st Edition

By Glenn R. Koller

Chapman and Hall/CRC

328 pages | 36 B/W Illus.

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Paperback: 9781138113916
pub: 2017-06-14
Hardback: 9781439818299
pub: 2011-10-21
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Risk Monetization: Converting Threats and Opportunities into Impact on Project Value addresses the organizational, political, cultural, and technical issues related to implementing a successful risk assessment, management, and monetization process. Suitable for readers in any organization or area of expertise, the book assumes no prior background in risk assessment, management, or monetization.

With more than three decades of experience in risk-process implementation, the author first explains the benefits of the risk-monetization process and how risk matters are generally not handled properly in contemporary organizations. He then introduces the terms and definitions essential to making risk monetization successful in a project. The text goes on to give examples of risk-monetization techniques applied in a variety of settings before discussing the typical risk situation for most projects and the shortcomings of conventional processes. It also describes how risk identification, assessment, management, and monetization processes are set up in an ideal environment as well as in imperfect situations. The final chapter focuses on how investment decisions are made based on the monetization and ranking of risks.

Enhancing your project’s value, this book offers step-by-step practical guidance on identifying, assessing, managing, and monetizing both threats and opportunities so that risk impedes the bottom line as little as possible. It shows you how to convert probable risks into positive impacts on the chance of success and/or profitability of any project.

Table of Contents

What’s the Point?

Skipping the Fundamentals for Now

Some Acronyms

A Focus on Success and Value—Not on Reducing Uncertainty

Many Contributing Disciplines

Many Views of Risk

An Aim to Integrate Risks

Surprise! Integrated Impact Is Almost Always Alarming

Where We Would Like to Be

How Risk Information Traditionally Is Handled—The Good, the Bad, and the Ugly

Risk Registers and Their Many Implications

The Fundamentals

Decide for Whom You Are (Really) Working

Be Clear as to "What Is the Question?"

Be Certain of the Right Level of Support

What I Assume

Some Definitions

Spectrum of Application for Monetization



Environmental Projects

Health and Safety

Risk Monetization of Legal Matters

Other Project Types

Without Risk Monetization, What Typically Is Done

Project Envisioned

Incomplete Representation

Don’t Tell Me What to Do!

Poor Translation of Qualitative Data into Quantitative Data

One, Two, Three—Go!

Little or No Risk Integration

Use of the "Boston Square"

Data Gathered from Those with Vested Interest

Faulty Forecasts

Lack of Organization

Mitigation of Threats

Initial Budget Estimates

Initial Schedule Estimates


Risk Interpreted as Uncertainty

Poor Risk Communication

Piecemeal Presentations

Determining the Reduction in Probability and/or Impact

Not a Consistent Deciding Body

Rewarding Activity

One Route to Risk Monetization—The "Perfect World" or "High Control" Path

Try to Be Unfashionably Early

Appoint a Risk-Process Proponent

Have "The Talk"

Don’t Underestimate the Upheaval

Decide How Sensitive "Soft" Risks Will Be Handled

Have the Conversation about Risk Acceptance

Determine What Has Already Been Done and Establish Rapport

Establish a High-Level Story about Why This Is Being Done

Design a Risk-Monetization Process That Fits with the Existing Culture and Workflows

Establish That There Will Be Only "One" Risk Register

Prepare for Risk-Identification Workshop (RIW)

Opening the RIW

Start Identifying Risks

Assessing, Valuing, and Ranking Risks Prior to Monetization

Mitigation/Capture Actions

Some Post-RIW Activities

Implement Sustaining Actions

Another Route to Risk Monetization—The "Already in Progress" or "Imperfect World of Low Control" Path

Some of the "Perfect World" Stuff Applies

"Risk Analyses" Already Done

Risk Monetization

A Warning and Justification for Monetization

Setting the Stage

The Monetization Process

Appendix: Summary of the Journey from Risk Assessment to Monetization and More

Selected Readings appear at the end of each chapter.

About the Author

Glenn R. Koller is a risk advisor at a major corporation. In 2008, he retired after 30 years as the head of the Major Project Risk Group at a major energy company. He holds two international patents on statistical routines and earned his Ph.D. in geochemistry/geophysics from Syracuse University. Dr. Koller’s research interests include all aspects of risk and uncertainty analysis, management, monetization, and training.

Subject Categories

BISAC Subject Codes/Headings:
BUSINESS & ECONOMICS / Management Science