ARTICLES  

STRATEGIC PLANNING FOR NEGOTIATING RESEARCH CONTRACTS

At any moment in a large organization, someone is bemoaning a failure caused by a lack of planning, someone else is galloping off on an unplanned or poorly planned project, and yet a third person is producing reams of paper labeled as a "strategic plan" (which unfortunately will immediately be filed and forgotten).  The history of strategic planning in most organizations has been one of irrelevancy, over-optimism, and bureaucratization when it has been used at all.  Accordingly, many people promptly go to sleep when the topic is raised.  This reaction can be disastrous to a negotiator.  True strategy development is crucial to successful negotiation and, unless it is done, any further activity is essentially random.

By strategic planning or strategy development in the context of negotiation, we do not mean the preparation of papers discussing the five year goals of the organization; nor is there a need for interminable committee meetings, multi-medium executive briefings, or high-tech computer modeling.  At the same time negotiation strategy is much more than a "playbook" of tactical maneuvers and predetermined positions to be taken.  A strategy is an overall plan or approach which is based on both qualitative and quantitative analyses and accounting for known constraints and preconditions.  It is intended to maximize the likelihood of success.  Perhaps the most important aspect of strategy development is analysis and minimization of identified risks.

INITIAL PLANNING FOR NEGOTIATION

Too often we want to begin a planning process with numbers and charts, audit reports and budgets.  While any good plan or strategy must, in the end, be based on this kind of rational, quantitative data, the beginning steps in strategic planning for negotiation (or any other activity) must be qualitative, intuitive, and conceptual.

A contradiction in terms?  Not at all!  A strategy, as stated earlier, is aimed at increasing one's chances of success.  What, however, is success?  Is it to maximize the return on a single deal or to establish a long term business (or political, social, or other) relationship?  Is it to gain the most or to lose the least?  These questions are seldom the type to be answered by analysis of "the numbers."  Similarly, the identification of risks and potential responses, while properly an organized activity, is seldom something that can be done mathematically.  (While probability and statistics deal with risks, the lack of available data usually makes probabilistic or statistical analysis impracticable).  The process is instead a matter of structured creative thinking.

IDENTIFYING THE NEEDS

Negotiation is a means of satisfying a need.  At this point some readers may groan and say:  "Not Maslow's Theory again."  Those readers can breathe a sigh of relief.  This article is about negotiation, not social psychology, so we will not digress into discussions of needs, hierarchies, Theory X and Theory Y, and the like.  This does not mean that a knowledge of psychology is not important to negotiation, but only that such knowledge can best be obtained from the primary sources.

For our purposes, it is sufficient to note that it is important to begin strategic planning with an identification of each party's needs.  These needs can generally be summarized by answering a series of questions:

                        C         What are the parties' perceptions of the need(s)?

                        C         Is there dissatisfaction with the present situation?  Why?

                        C         What uses are to be made of the product or service which is the focus of the negotiation?

It is helpful to make some distinctions among the various groups represented by the negotiator.  Some may already have an understanding of the nature of the problem, what they want, and why.  Others may have only a general perception of the problem and what needs to be done about it.  In the latter case, a more extensive discussion may be needed to develop the basis for an eventual agreement or contract that will be useful.  The development of an effective strategy often is an important means of obtaining consensus, countering internal opposition, and creating support for the results finally obtained by the negotiator.

It is important to recognize different (and often conflicting) viewpoints and interests among factions within the negotiator's own organization.  For example, the official activity represented may be a research management office, whereas the real interested party may be the programs office.  Other participants in the process may include managers of related programs, faculty or company committees, the budget and finance office, or even other organizations (such as an association or a subcontractor).

To develop a clearer idea of any of these participants' needs, attempts should be made to elicit information and clarify viewpoints on the nature of the problem, the general context of the problem, and parts that appear to require special emphasis.  Specific attention should be given to the order of priority in approaching the various parts of the problem and to particular points of information or insight essential to make the decision or meet the decision makers' needs.  The bureaucratic or political context in which the negotiation will occur needs to be understood.  The time available for the negotiation and the critical points at which specific action is needed should be ascertained.

DEFINING THE NATURE AND SCOPE OF THE PROBLEM(S)

It is vital that the intended users (e.g., the scientists) together with those persons responsible for the agreement or contract (e.g., the research administrator) share a common understanding of the nature and scope of the issues at stake.  A shared understanding of the scope of the work and the objectives and measures of the program are the foundation for defining the initial direction of the negotiation strategy.

DETERMINING VALID OBJECTIVES

The objectives of the negotiator's own organization – the benefits desired – frequently are not stated clearly and precisely when initial planning is begun.  The original sponsors of the program may not have had a precise idea of the end results desired.  Formal statements of objectives may be intentionally ambiguous if it was easier to obtain a consensus on what is needed.  Value judgments underlying the objectives may not be shared by important groups.  Consequently, the end results intended may be perceived by some as having ill effects for them.  Furthermore, explicit statements of objectives tend to imply a specific assignment of priorities and commitment of resources that may not actually exist.

To the extent feasible, however, statements of objectives should:

                        C         Capture a complete understanding of the intended benefits, including the expected level of attainment.

                        C         Identify recipients of unavoidable adverse consequences or of unintended benefits.

                        C         Include important qualitative objectives even though measuring degrees of attainment may be exceedingly   
            difficult.

                        C         Take account of multiple objectives which may be complementary or conflicting.

Because of these interrelated and sometimes conflicting factors, the negotiation effort may have to proceed without full  determination of all valid objectives.  If this is the case, objectives should be re-examined and modified or clarified as the negotiation effort progresses.

Ideally, the negotiator should be the principal strategist.  However in many situations, strategy or aspects of strategy are dictated by higher authority.  Nevertheless, the negotiator must be fully aware of the elements of strategic concern and must make every effort to change a dictated strategy that pushes beyond the bounds of a feasible, appropriate approach.

To meet the responsibility for formulating and executing the overall acquisition strategy, the negotiator must thoroughly understand:

                        C         The organization's objectives.

                        C         The nature of the need.

                        C         The organization's resource base.

                        C         The overall program objectives/constraints/priorities (to the extent these differ from the organization's objectives).

                        C         The "market" factors.

                        C         The priority of program issues/objectives.

The need to consider the first three elements should be apparent.  Analyzing the organization's objectives, needs, and resources forms the basis for the organization's overall strategy.  A particular program with assigned objectives, constraints, and priorities is one element of this strategy.  A negotiator should fully understand how the program fits into the strategy and why and how the program objectives were determined.  Put simply, the negotiator should have a long-range vision of the program.

The market factors element includes both "industrial" and "political" concerns.  Does the other party have the capability to meet technical objectives?  Are there enough capable organizations to create effective competition?  The market factor also involves intra-organization and "political" considerations.  A negotiated deal may also have to be "sold" to the program managers, higher departmental levels, and even the Government, especially if all objectives cannot be met.

Understanding the existing situational realities is critical.  If, for example, a market analysis indicates that there is a high risk that the other party's capability will not meet the requirement within the established schedule, strategic approaches to resolving this problem must be developed.

Exhibit 1 lists for each strategic element the subelements that should be considered to develop the overall strategic approach.  Applicable subelements will be dependent on the program.  Generically, they will fall within the three major areas of technical, cost, and schedule.

                                                                    EXHIBIT 1

                                                      STRATEGIC CONCERNS

ORGANIZATIONAL POLICY

                        C         Organizational Objectives

                        C         Needs/Technologies

                        C         "Mission" Analysis

                        C         Allowable Measures Available To Meet Need (i.e., what results are approvable under organization's own rules)

PROGRAM OBJECTIVES/CONSTRAINTS/PRIORITIES

                        C         Technical Performance

                        C         Operational Capability

                        C         Time

                        C         Purchase Cost

                        C         Life-cycle Cost

MARKET FACTORS

                        C         Base of Possible Entities Who Could Satisfy the Need

                        C         Qualifications of Other Parties

                        C         Administrative Requirements (e.g., "required" terms)

                        C         Commercial Potential

                        C         Competition Potential

                        C         Scarcity of Resources

                        C         "Political" Support and Advocacy

A final note on the strategic planning for negotiation concerns the character of the strategy.  The negotiator and others must be convinced that the strategy is a feasible, well conceived, and complete approach to achieving program objectives; that it is consistent with current policy and procedures; and that it can be effectively executed.  The criteria of realism, stability, flexibility, balance, and controlled risk provide a basis for strategy evaluation.

EVALUATING NEGOTIATING STRATEGIES

For a strategy to provide the basis for a valid agreement and to aid in gaining acceptance and support of the negotiated result, it must meet certain criteria:

                        C         Realism.

                        C         Stability.

                        C         Flexibility.

                        C         Balance.

                        C         Controlled risk.

This section provides a working definition of each criterion, why it is important, what pressures work against it, and the steps necessary for achieving it.

REALISM

Working Definition

A strategy is realistic if the objectives are attainable and there is reasonable assurance that the strategic approach to satisfying them can be successfully implemented.

The realism of the objectives has been included in this definition, for it is impossible to develop a realistic strategy with unrealistic goals or objectives.  Realism cannot be easily quantified, but there are some measurable properties.  Realism can often be measured on a relative basis.  Of course, a two-fold increase in present performance is more realistic (attainable) than a three-fold increase.  Ranking methods and probability and statistical analyses are other measurement techniques.

Importance of Realism

Only a realistic approach will elicit support for the program at all levels.  A strategy that is unrealistic can result in continuous turmoil and crises and may lead to ultimate failure.  When a negotiator later finds that certain objectives are not attainable, the first reaction is to try "Band-Aid" approaches, such as "split the difference" or deferring the negotiation session.  Even if such temporary measures appear to work, the negotiation has started on a "giveback" path that can lead to continued losses. 

Clearly, a strategy that requires such approaches is not the way to plan a negotiation.  The only way to avoid such a situation is to set requirements and approaches related to technical, cost, and schedule factors well within capabilities.  (Don't be too cautious.  This can also be a form of nonrealism.  Programs are not started with planned large expenditures of resources in order to produce relatively minor improvements.)  Simply stated, the strategy should represent a conceptual plan that is neither overly optimistic nor overly conservative – another way of defining realism.

 Pressures Against Realism

An immediate goal of a negotiator is to reach an agreement and to see that it is approved within his or her own organization.  This goal often induces unrealistic claims such as matching or exceeding the capability or milestones of a competing approach or beyond-state-of-the-art performance requirements.  It is important that the negotiator recognize the types of pressures acting against a realistic strategy and counter them appropriately.  Exhibit 2 lists the more common pressures.

Achieving Realism

Mandating realism is easy, but achieving it is often difficult. There is no simple formula.  Exhibit 3 lists actions that might be taken to provide a basis for a realistic strategy.  It shows that achieving realism should involve detailed study of the need, assessment of the state-of-the-art in all technology areas, review of past performance in similar situations, and a survey of the organization's true capability.  Studies take time and resources; but since realism is such an important criterion for a successful strategy, every effort should be made to support this undertaking in critical areas.

                                                                    EXHIBIT 2

                                   PRESSURES WORKING AGAINST REALISM

Pressure		Description and Effect
Forced Outcome		Firm set of requirements that do not permit trade-off.  Negotiator must force-fit strategy.
Directed Strategy		Strategy mandated by higher levels, usually a single alternative and not based on careful planning.  Can be highly optimistic with respect to schedule and resource requirements.
Micro-Management Avoidance		To avoid future micro-management, the program manager may adopt a "close to the vest" syndrome, so that only minimum details of the conceptual approach are revealed to the negotiators.  Guidance is withheld from negotiators, and a gamble is taken on the approval process.
Low Departmental Priority		For programs that do not have high priority within the department, the negotiator may include in the strategy a doctrinally correct recitation of functional concerns and approaches to avoid controversy and thereby ignore the real interests and program concerns.
Strong Competition		Competing programs or strong high-level departmental or political opposition can force program managers to counter these elements without assessing potential for successful accomplishment.  The negotiator may be forced into trying to reach the unreachable.

                                                                    EXHIBIT 3

 

                                          ACTIONS FOR ACHIEVING REALISM

 

 

 

C         Analyze the need to understand fully the required technical performance and schedule constraints.

 

 

C         Identify the functional support talents required to assess realistic requirements and approaches and ensure that they are on board during the strategy-development phase.

 

 

C         Establish a "blue ribbon" panel of experienced and highly competent technical and resource people to review requirements and approaches.

 

 

C         Study similar negotiations to establish a baseline for realistic cost and schedule milestone accomplishments.  Perform independent cost and schedule assessments.

 

 

C         Analyze similar situations to establish a baseline for technical requirements.

 

 

C         Perform detailed cost and schedule analyses using "what if?" and "worst case" analysis procedures to identify potential problem areas.

 

 

C         Establish applicable contingency plans to address the more risky areas of the strategy.

STABILITY

 

Working Definition

 

Stability is the characteristic that inhibits negative external or internal influences from seriously disrupting the progress of negotiations.  These negative influences frequently cause changes in cost, schedule, or performance requirements that can threaten the achievement of objectives.  It would be naive to assume that any significant program will not encounter situations that can change the course of the negotiations to some extent.  Some of these situations may well be beyond any strategic control.  However, there are many potential causes of instability that can be countered to some extent by a carefully designed strategy.

 

Importance of Stability

 

Any change in critical parameters can ripple throughout the program, cause serious disruptions, reduce confidence in program estimates and assumptions, increase cost, technical, and schedule risk, and reduce morale and motivation.  Frequently, when a major change is made, such as funding, a "downstream" parameter such as operation or support bears the brunt of the change, and operational capability can be significantly affected.

 

Pressures Working Against Stability

 

Exhibit 4 lists some of the more important pressures leading to instability that the negotiator should recognize in developing the strategy.

 

Achieving Stability

 

Three elements can enhance stability:

 

                        C         Direction.

 

                        C         Advocacy.

 

                        C         Commitment.

 

Exhibit 5 defines each of these elements, describes why they are important, and suggests some approaches for incorporating them into the acquisition strategy.

                                                                    EXHIBIT 4

 

                                  PRESSURES WORKING AGAINST STABILITY

 

 

Pressure		Result/Effect
Funding Process		Yearly funding levels and streams may change as a result of organizational or economic factors.  This may cause reallocation of requirements and priorities, leading to reduced capability.
Requirements Changes		Requirements changes occur when the user is uncertain of the need or required capability or perceives a greater or lesser need.  This results in decreased user support and disruption of the negotiation process.
Changing Managerial Policy		Changing administrations, executives, political climates can result in revised policy, which can affect stability.
Negotiation Organiza- tion/Personnel		Changes in the negotiator's own organization and personnel can cause disruptions; lack of continuity; changes in directions, processes, and procedures.

                                                                    EXHIBIT 5

 

 

                                        STABILITY REQUIREMENTS RELATED

                                                  TO ACQUISITION STRATEGY

 

 

 

Element	Description		Importance
Direction	A strategy that clearly delineates program objectives, approaches, and control procedures		The negotiator who shows lack of purchase and control is likely to lose control to the other party.  Strategy must impart a sense of knowing where you are going and when and how you are going to get there.
Advocacy	Support from high-level positions in the department, administration, or management		Initial targets for change are programs without high-level support.  Know who the initial supporters are, keep them informed, and “cultivate” new supporters.
Commitment	Agreements that cannot be easily canceled		If the organization establishes an agreement with external parties (e.g., prospective subcontractors or a government sponsor), then a measure of stability is achieved.

 

                                   

 

 

BALANCE

 

Working Definition

 

Balance is a condition of equilibrium between and within major objectives.

 

The achievement of cost, schedule, and technical requirements uses resources of time, people, facilities, and money – all of which are limited.  The degree of balance is not usually measured directly, but it can be measured in terms of risk in meeting objectives.  In this sense, a balanced strategy is one for which all risks are approximately equal, where the risk measure includes establishment of priorities and assessment of damages in case of failure.

 

Importance of Balance

 

A negotiator often must respond to high-level directions which present conflicting demands.  These include speed versus a high level of achievement of objectives and minimization of cost versus attaining quality performance.

 

Overemphasis on one objective could jeopardize the chances of meeting other objectives.  By fully understanding the priorities, relationships, risks, and required resources for each objective, the negotiator can develop a strategy that provides the necessary balance and the justification to say "no" with conviction when changes by the other party, the user, headquarters, or others are requested.

 

Pressures Working Against Balance

 

Parochialism is probably the major pressure working against balance.  The negotiator must do everything legitimately possible to ensure that the negotiation is successful.  Functional managers operate from the same premise.  The negotiator must recognize that the user wants the best performance and wants it quickly, financial offices want to lower cost, and the other negotiator wants to "win."  In addition, external situations can occur that may have a severe impact on balance.  Examples include the emerging importance of environmental impacts, the increasing potential for big money flowing from commercialization of research results, and reduced funding because of economic climate.

 

Achieving Balance

 

Understanding the organization requirements and the priorities of objectives is a key factor in achieving balance.  Another key factor is risk.  Resources must be allocated to achieve a required level of capability with acceptable risk.  An additional factor is the amount of resources--rarely enough to "comfortably" do everything.  Exhibit 6 suggests approaches to considering these factors in developing a balanced strategy.

                                                                    EXHIBIT 6

 

                                           FACTORS IN AND APPROACHES TO

                                         ACHIEVING A BALANCED STRATEGY

 

 

Factor/Approach		Discussion
Information		How long should performance take?  How much should performance cost?  How accurately can performance be assessed?  Answers to questions such as these are obtained through analyses of similar situations.  They will provide a basis for estimates useful for initial resource allocation.
Priority Analysis		Determine the importance of the objective and the requirements for establishing a priority ranking.  Risk levels in resource allocation are then assigned to account for varying priorities.
Resource Allocation		Do not defer allocating resources for a major element.  While flexibility is important, such major deferral can often absorb unassigned resources simply because they are unassigned.  This is not the same as providing a reserve.
Concurrency		Concurrency entails tying one objective to another.  Generally, risks of not achieving either objective are increased, but the potential for "winning the battle but losing the war" is reduced.
Cost/Risk Sharing		The negotiator should always adopt a strategy that encourages the other party to achieve balance.  For example, a fixed-price effort may be acceptable if there is potential for long-term, high-value business.  The other party may be willing to undertake reliability-achievement risks, such as through warranties or guarantees, if there will be a benefit in exceeding target sales.  By the reduction of risks through this approach, more resources can be made available in other areas, thereby helping to achieve the desired balance.

 

FLEXIBILITY

 

Working Definition

 

Flexibility is an element of strategy allowing changes and failure to be accommodated without significant changes in resource requirements.  A strategy that allows for no change in approach is one that is destined to be challenged by events.

 

As with the other characteristics discussed, there rarely is a single measure that can be used to quantify flexibility.  One useful analytic approach can be called "what if?" – a form of contingency planning, e.g.:

 

                        C         What if the other party "walks out"?

 

                        C         What if the principal investigator gets other work in the middle of negotiations?

 

                        C         What if a new technology becomes available?

 

                        C         What if the program budget is cut by 15 percent?

 

                        C         What if the other party cannot grant full patent rights?

 

                        C         What if a certain activity is completed six months later than planned?

 

Through such analyses, areas where flexibility is needed can be identified and measures can be taken to provide "back-up" or alternative approaches to meeting objectives.

 

Importance of Flexibility

 

One of the most predictable occurrences in a negotiation is change.  Flexibility enables the negotiator to deal with change – to bend but not break.  Without flexibility, changes can throw the negotiator off balance, leading to unrealistic approaches, panic-induced blunders, and negotiation impasses.

 

Pressures Against Flexibility

 

As indicated in the discussion of stability, those who review a program should feel that the strategy is directed toward successful accomplishment, with all major areas addressed.  However, all approaches should not be so firmly fixed that changes or failures cannot be accommodated – indeed, identifying the areas where change or failure is possible and employing approaches to deal with them are signs of good strategic planning.  Some may insist that a strategy must be firmly cast to exclude such possibilities.  Frequently there are pressures against maintaining "reserve resources."  If the nominal schedule estimate indicates a five-year development, that is what the user may insist upon, even if such a schedule allows no "space" for dealing with any significant problems.

 

Achieving Flexibility

 

The first step in developing a strategy with sufficient flexibility is to identify areas in which there is a significant probability that changes and failures could occur.

 

What is "significant"?  Not everything can be covered; otherwise the strategy becomes so flexible that it offers no firm basis for proceeding.  One might adopt the approach that any significant potential change or failure with a subjective probability of occurrence of 20 percent or more should be addressed through a flexible strategy.  In the range of 5 to 20 percent, strategic flexibility measures should be applied on a priority basis, depending on the criticality of the potential event and its probability of occurrence.  Under 5 percent is the "gamble region," where no specific strategy development action is necessary unless the change or failure can be catastrophic to the program.  Note that by the inclusion of the probability of failure and the consequences of failure (criticality), this approach casts the problem in terms of risk analysis.

 

Exhibit 7 lists approaches for achieving flexibility and describes their development and implementation.

                                                                    EXHIBIT 7

 

                                                    ACHIEVING FLEXIBILITY

 

 

 

Factor/Approach		Discussion
Multiple Sources		For any stage of the negotiation process, multiple sources offer a flexibility that can help ensure success.  While multiple sourcing is initially much more costly than single sourcing, its associated competitive aspects leads to significant flexibility.
Agreement/Contract Flexibility		Agreements/contracts can be written to provide needed flexibility in areas of uncertainty – thus avoiding high risks for either party because of changes.  One common example is the use of price-escalation indices to adjust for significant economic changes or pricing for variable quantities.
Pre-Planned Improvement		In technology areas of high risk and uncertainty, it may be prudent to plan for changes of new technology.
Management Reserves		If all resources are firmly allocated, then, almost by definition, all such resources are absolutely needed.  As in battle situations, rarely should the negotiator commit everything initially without any reserves.
Functional Flexibility		Every program will experience personnel turnovers, some in key functional positions.  The strategy and lower-level tactical strategies must be flexible enough to permit a variety of approaches that do not rely on a "star" negotiator.

CONTROLLED RISK

 

Working Definition

 

Risk, as applied to strategy, is a measure of the probability and consequences of not achieving a defined program goal.

 

Most people agree that risk involves the notion of uncertainty.  A probability measure can be used for such questions; e.g., the probability of not meeting the date is 0.15.  However, it is now generally accepted that when risk is considered, the consequences or damage associated with failure must also be considered.

 

Goal A, with a failure probability of only 0.05, may present a much more serious (risky) situation than Goal B, with a failure probability of 0.20 if the consequences of not meeting Goal A are more severe than the failure to meet Goal B.

 

Conceptually, then, risk can be defined as a function of uncertainty and damage, i.e.,

 

                                                      Risk =f(uncertainty, damage)

 

In general, as either the uncertainty or damage increases, so does the risk.  Both the uncertainty and the damage must be considered in a risk analysis.

 

Another element of risk is the cause of risk.  Something, or the lack of something, induces a risky situation.  We denote this source of danger as the hazard.  Certain hazards can be overcome to a great extent by knowing them and taking action to overcome them.  A large hole in a road is a much greater danger to a driver who is unaware of it than to one who travels the road frequently and knows enough to slow down and go around the hole.  This leads to the second conceptual equation:

 

                                                       Risk = f (hazard/safeguard)

 

Risk increases with hazard but decreases with safeguard.  The implication of this equation is that the strategy should be structured to identify hazards and to allow safeguards to be developed to overcome them.  If enough safeguards are available, then risk can be reduced to an acceptable level.

 

Importance of Risk Assessment

 

Risk assessment is the underlying approach for negotiation strategy development.  It provides one basis for determining conformance to the other four criteria – realism, stability, balance, and flexibility – and for selecting approaches for improving the strategy.  In fact, it can be argued that the four criteria are elements necessary to minimize risk through the negotiation strategy.

 

Pressures Working Against Risk Minimization

 

There is no specific pressure that inhibits risk minimization other than constrained resources.  However, risk is not always easy to assess, since the probability of failure and the consequence of failure are usually not measurable parameters and must be estimated by statistical or other procedures.  While formal risk analysis procedures deal with the "known unknowns," there is also the issue of "unknown unknowns."

 

Here usually only qualitative assessments are possible.  Yet, despite these difficulties, risk assessment provides a formalism and structure for selecting strategy alternatives and should be a major element in the decision-making process.

 

 

DEVELOPMENT OF A RISK-ORIENTED STRATEGY

 

The following are the key steps in developing (and, as Exhibit 8 shows, revising) a strategy that meets the criteria of realism, stability, balance, flexibility, and controlled risk:

 

                        C         Identify the need.

 

                        C         Assess the situational realities.

 

                        C         Assemble strategy development resources.

 

                        C         Establish strategic goals, risk levels, and priorities.

 

                        C         Identify specific alternatives.

 

                        C         Establish decision criteria.

 

                        C         Evaluate alternatives.

 

                        C         Develop overall strategy.

 

 

RISK ASSESSMENT METHODS

 

Approaches for assessing risk can be either quantitative or qualitative, depending on whether statistical probabilities are assigned to a risk element.  But all risk assessment entails some subjectivity.  In virtually all approaches, experts are asked for subjective judgments of what the risk elements are as well as the likelihood of their occurrence.  What distinguishes one approach from another is the information that goes into the subjective judgments (such as test results or professional expertise), the ways in which the information is obtained, and the kind of information requested (for example, a judgment of high, medium, or low risk or a judgment about statistical probabilities).