System and method for managing risk and opportunity

• US 7,305,351 B1
• Filed: 10/06/2000
• Issued: 12/04/2007
• Est. Priority Date: 10/06/2000
• Status: Expired due to Term

• Current Assignee: Infineon Technologies AG, Siemens AG
• Original Assignee: Qimonda AG (Infineon Technologies AG)
• Inventors: Haug, Achim, Wittman, Edgar, Pfennig, Michael, Bechhofer, Steven, Collmer, Bernd
• Primary Examiner(s): MEINECKE DIAZ, SUSANNA M
• Application Number:
  US09/680,923
• Time in Patent Office: 2,615 Days
• Field of Search: 705/7
• US Class Current: 705/7.28
• CPC Class Codes: G06Q 10/0635 Risk analysis of enterprise or organisation activities
• CPC Class Codes: G06Q 10/0637 Strategic management or analysis, e.g. setting a goal or target of an organisation; Planning actions based on goals; Analysis or evaluation of effectiveness of goals
• CPC Class Codes: G06Q 30/0201 Market modelling; Market analysis; Collecting market data
• CPC Class Codes: G06Q 40/08 Insurance

Abstract

A method of projecting a future condition of a business entity by identifying a plurality of risks and a plurality of opportunities for the business entity and evaluating at predetermined times a potential impact of each of the risks and each of the opportunities on the future condition of the business entity. Determining at each of the predetermined times for each of the risks one of a probability that the risk will come to pass during a predetermined period of time and a frequency at which the risk will come to pass and determining at each of the predetermined times for each of the opportunities one of a probability that the opportunity will become available to the business entity during a predetermined period of time and a frequency at which the opportunity will become available to the business entity. Projecting at each of the predetermined times the future condition of the business entity based on the potential impact of each of the risks and opportunities and based on the determinations with respect to the one of frequency and probability for each of the risks and opportunities.

Claims

1. A system, comprising:

a first storage means for receiving and storing data at predetermined times, wherein the data corresponds a plurality of risks and a plurality of opportunities for the business entity;

a second storage means for receiving and storing data at each of the predetermined times, wherein the data corresponds to a potential monetary impact on the future condition of the business entity of each of the risks and opportunities stored in the first storage means;

a first input means for receiving at each of the predetermined times, for each opportunity stored in the first storage means, data corresponding to one of a probability that the opportunity will occur during a predetermined period of time and a frequency at which the opportunity will occur,

a second input means for receiving at each of the predetermined times, for each risk stored in the first storage means, data corresponding to one of a probability that the risk will occur during a predetermined period of time and a frequency at which the risk will occur, and

a calculation means for projecting at each of the predetermined times the future condition of the business entity based on a monetary value of each of the risks and opportunities stored in the first storage means, wherein the monetary value is a function of the potential monetary impact and the one of frequency and probability for each of the risks and opportunities from the first and second input means;

wherein the potential monetary impact is a function of one of earnings before interest and taxes (“

EBIT”

), operating cost savings and market share gains.

2. The system according to claim 1, wherein the calculation means projects the monetary value for the future condition of the business entity based on a multiplication of the potential monetary impact of each of the risks and opportunities stored in the first storage means by the corresponding one of frequency and probability.

3. The system according to claim 2, wherein risks having monetary values below a threshold are accepted.

4. The software system according to claim 1, further comprising:

a handling means for including risk handling measures to decrease the probability that at least one risk will occur.

5. The system according to claim 1, further comprising:

an assessment means for determining if at least two risks affect one future condition.

6. A computer-readable storage medium storing a set of instructions, the set of instructions capable of being executed by a processor to project a future condition of a business entity, the set of instructions performing the steps of:

identifying a plurality of risks and a plurality of opportunities for the business entity;

evaluating at predetermined times a potential monetary impact of each of the risks and each of the opportunities on the future condition of the business entity;

determining at each of the predetermined times for each of the risks, one of a probability that the risk will occur during a predetermined period of time and a frequency at which the risk will occur;

determining at each of the predetermined times for each of the opportunities, one of a probability that the opportunity will occur during a predetermined period of time and a frequency at which the opportunity will occur;

projecting at each of the predetermined times the future condition of the business entity based on a monetary value of each of the risks and opportunities, wherein the monetary value for each of the risks and opportunities is determined based on the potential monetary impact and the corresponding one of frequency and probability;

and wherein the potential monetary impact is a function of one of earnings before interest and taxes (“

EBIT”

), operating cost savings and market share gains.

7. The computer-readable storage medium according to claim 6, wherein the monetary value is determined by a multiplication of the potential monetary impact by the corresponding one of frequency and probability.

8. The computer-readable storage medium according to claim 7, wherein the set of instructions performs the step of:

ranking each risk based on a result of the multiplication of the potential monetary impact of each risk by the corresponding one of frequency and probability for the risk.

9. The computer-readable storage medium according to claim 6, wherein the set of instructions performs the step of:

reporting each of the risks and opportunities to management of the business entity.

10. The computer-readable storage medium according to claim 6, wherein the set of instructions performs the steps of:

handling at least one of the risks to decrease the probability that the at least one risk will occur; and

handling at least one of the opportunities to increase the probability that the at least one opportunity will occur.

11. The computer-readable storage medium according to claim 6, wherein one of a checklist and a questionnaire identifies one of the risks and the opportunities.

12. The computer-readable storage medium according to claim 6, wherein the set of instructions performs the step of:

identifying a root cause for one of the risks and the opportunities.

13. The computer-readable storage medium according to claim 6, wherein the predetermined times include one of a month and a week.

14. The computer-readable storage medium according to claim 6, wherein the set of instructions performs the step of:

comparing a previously projected future condition to an actual condition at a time corresponding to the previously projected future condition to determine an accuracy of the projected future condition.