ABSTRACT
This chapter introduces a new engineering risk management metric called the risk correlationship index. The risk correlationship (RCR) index measures the strength of the influence of risk inheritance between supplier programs and across supplier–provide chains that comprise a capability portfolio. The risk score of a program node with noninherited risk events that then inherits one or more risks from one or more other program nodes cannot be lower than its risk score prior to the inheritance. A risk event inherited by a program node shall have its impacts assessed in terms of how the risk, if it occurs, has negative consequences on that program node’s ability to deliver its contribution to its associated capability node. The purpose of the RCR index is to signal where risk-reducing opportunities exist to minimize dependency risks that, if realized, have cascading negative effects on the ability of an enterprise to deliver capabilities and services to users.
