Optimising financial processes

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Are our Brains Helping us Manage Risk?

Are our Brains Helping us Manage Risk?

“Humans are not actually very good at assessing risk- especially their own risk” states Marie Hellweg-Larsen, a professor of psychology at Dickinson college.

Whether you are assessing everyday risks in management decision making, performing structured risk assessments on key financial risks, or planning a business process, system or technology change, this article by The New York Times points to some of the tricks that our minds play on us.

This is important because it reaffirms that whilst we are rightly focused on the power of data, “the facts” are not the only factor we bring to bear in opinion forming and decision making.

The article gives a brief insight into ‘Optimistic Bias’, “Confirmation Bias” and the “False Sense of Control” that also affects our judgement.

The COVID-19 crisis we face has created an abundance of additional decisions to tackle and risks to manage. But the problem lies not so much in the existence of risks, but more with with the need for us to acknowledge that we may not always view them with the objective clarity we may assume.

This is an important topic as we face ever more important decisions. This is worth a few minutes. You can read the Article Here

Our ‘Something To Consider’ snippets are framed as small, digestible, ‘dashes of insight’ around the pillars of what we define as “World Class Finance” – Process Optimization, Financial Control and Compliance, and Risk Assurance, all underpinned by technology enablement and integration.