I've been teaching courses on risk management for many years now, and I can say that almost everyone starts off with the wrong idea about risk. Let me give you a scenario. Imagine that you're flying in an airplane a 2,000 meters, all the engines fail and the pilot tells you that the plane will soon crash. She offers you a parachute and now you have a choice. Will you jump for the plane with the parachute or jump without it? Which of these options is the most risky? Most people will answer that jumping without the parachute is the most risky. But if you think about it, jumping without the parachute will result in a certain outcome. You'll die. Some people will say that is actually risk-free because there's only one possible outcome. Jumping with the parachute is more risky in the sense that there are a range of possible outcomes. You could make a perfect landing and walk away on skate. Let's say that the probability of that happening is 80 percent. Then there's some probability that you survive but with an injury, maybe you break your ankle on landing. Finally, there's still a chance that you die. Perhaps the parachute is faulty. So now what we have is a range of possible outcomes. Depending on your definition of risk, jumping with the parachute could be considered really risky because there's this range of possible outcomes. In this course, we define risk as the effect of uncertainty on objectives. Assuming that your objective is to survive the crash, then the least risky strategy is the one that gives you the best chance of achieving that objective and clearly that's a strategy of jumping with the parachute. Notice that you had to accept uncertainty in order to achieve your objective and then is true in many business settings. If you take no risk at all, you'll never succeed. Our approach to risk management is essentially goal oriented. This fits in nicely with the purpose of risk management as defined by the standard. The purpose of risk management is the creation and protection of value. It improves performance, encourages innovation, and supports the achievement of objectives. The other nice thing about this parachute example as it illustrates a simple risk assessment. For the parachute strategy, we identify three possible outcomes and we assigned a probability to each. This is quite typical of how we approach the problem of risk assessment, and assessment is essential before we can even think about treating the risk in some way. Analyzing risks like this can be really useful to help you understand the risk and also influencing other people who may be involved in decision-making. One of the objectives of this course is to demonstrate some simple but really useful quantitative risk assessments. For our degree learners, you will also learn the skills to do risk assessments yourselves.