This is my Solution: 1.

Evaluation of the Test a software application for production readiness or put into production? scenario:

I would evaluate the situation using the risk equation (Risk = Impact * Probability). The two potential risks associated with this scenario are the decision to put the software into production without extensive testing or to perform the testing before the release.

The chart for this scenario shows us Without testing, the impact of a minor issue could be $10,000 and the likelihood of this occurring is estimated to be 80%, while the impact of a major issue could be $30,000 with a likelihood of 35%. With testing, the impact of a minor issue could be $10,000 with a likelihood of 30% and the impact of a major issue could be $40,000 with a likelihood of 10%.

From the above information, we can calculate the risks linked to each option:

Without testing: Risk (minor) = $10,000 * 0.8 = $8,000 Risk (major) = $30,000 * 0.35 = $10,500 With testing: Risk (minor) = $10,000 * 0.3 = $3,000 Risk (major) = $40,000 * 0.1 = $4,000

This shows us the risk associated with putting the software into production without testing is higher compared to performing the testing prior to putting it into production. However, the tangible factors that influence the decision are that testing is estimated to cost $125,000 and take 60 days. We also need to take into consideration the intangible factors which include pressure from the executive committee and the reputation of the company if the software has problems.

I would recommend performing the comprehensive testing before putting the software into production. This would reduce the risk associated with the potential issues and ensure the software is ready for production. In the end, reducing the potential negative impact on the company, which I find most important in this scenario.

2. Evaluation for the Losing job with severance or come on as contractor no severance? scenario:

I would evaluate the situation by considering the financial and other impacts of each option.

The direct, tangible factors that influence this decision include the current salary of $100,000, the 9 months of severance pay, and the offer of a contract position with a higher salary of $120,000. The intangible factors include job security, the responsibility for training a replacement, and the two years until retirement age. Job security is an extremely important intangible factor to consider. While the contract position may provide a higher salary, it also includes the added responsibility of training a replacement and the uncertainty of future employment after the 6-month contract period. On the other hand, severance pay provides financial stability but with no job security.

Looking at the financial aspect of this scenario, the contract position offers a higher salary, but with no severance pay. As opposed to, severance pay would provide financial stability for 9 months, but wouldnt guarantee employment after the 9 months.

Considering the above information, I would evaluate my financial stability to determine the best course of action. If I have a healthy savings, I will highly consider the severance pay. This would alleviate the headache of having to train a replacement and any further responsibility with the company. If job security is more important, and I dont have or dont want to dip into my savings, I would take my chances at being a contracted employee in hopes I am contracted past the 6-month minimum contract period.

This is the continued Problem:

This week you will discuss the Risk Equation Homework Assignment. The goal for this week is to share with each other how you came to understand the important role that numbers and probability play to risk management, as well as discuss the inherently fuzzy nature of predicting the future.

We see tables of numbers that predict average lifespan and some people treat them as rules. Nothing could be further from the truth. They simply represent a statistical likelihood about how long any given person with defined characteristics is "likely" to live. This is one aspect of risk management that is as much art as science. The math calculates likelihoods but the critical thinking determines what should be included in the mathematical analysis.

Discuss the following:

What result did you determine for the software testing scenario? What was most challenging about completing that analysis? What additional information did you wish you had? How comfortable were you with making the final decision based on what you calculated?

What was the second scenario you analyzed? Why did you pick that scenario? What was most challenging about completing that analysis? What additional information did you wish you had? How comfortable were you with making the final decision based on what you calculated?

Discuss the benefits and drawbacks associated with numerically analyzing risk situations and choices.

How would you best combine critical thinking and the risk equation approach in your risk management decision making?