Norman Marks discusses points from a recent paper, Feeling hungry? A simpler, more intelligent approach to risk appetite, written by Chris Burt of Halex Consulting.
While the cost of control is certainly something to consider, there are times (many, many times) when more risk should be taken because of the potential for increased reward.
When we make a decision, we normally make a number of assumptions about what we expect to happen. My view of risk management, or should I say risk management that adds value and helps an organization succeed rather than just avoid failure, is all about what might happen.