ABSTRACT
This chapter provides a more detailed analysis of variation, knowledge, uncertainty, surprises and black swans in a risk assessment and management context. First, in Section 3.1 we look at variation and its link to probability modelling. A subsection is included on the distinction between ‘common-cause variation’ and ‘special-cause variation’, which are key concepts used to control and improve different types of processes in quality management. We study the meaning of these concepts, with a special focus on the latter notion: how is the special-cause concept linked to ideas and concepts used in risk assessment and management to reflect unforeseen and surprising events? In the quality discourse it is common to refer to two possible mistakes when confronting variation: (i) to react to an outcome as if it were the result of a special cause, when actually it resulted from common causes of variation; and (ii) to treat an outcome as if it were the result of common causes of variation, when actually it was the result of a special cause. However, at the point of decision-making, it is difficult or impossible to know what the ‘true’ state is. It is also appropriate to ask whether such a true state does in fact exist. In Section 3.1.1 we discuss these issues, the main aim being to improve our understanding of the variation concept and its link to risk and surprises.
