Advanced Risk Analysis in Engineering Enterprise Systems

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Engineering Risk Management

1.1      Introduction

Risk is a driving consideration in decisions that determine how engineering systems are developed, produced, and sustained. Critical to these decisions is an understanding of risk and how it affects the engineering and management of systems. What do we mean by risk?

In general, risk means the possibility of loss or injury. Risk is an event that, if it occurs, has unwanted consequences. In the context of engineering management, risk can be described as answering the question, “What can go wrong with my system or any of its parts?” (Kaplan and Garrick, 1981). In the past 300 years, a theory of risk has grown from connections between the theories of probability and economics.

In probability ...