# Risk Oriented Estimating

Risk-Oriented Estimating (ROE), is a methodology for [[construction-estimating]]
which prioritizes estimating tasks by their contribution to cost certainty,
and determines the appropriate level of [[estimating-detail]]
given [[risk#Risk Tolerance]]

ROE leans heavily on [[expected-value-of-perfect-information]],
which challenges the natural tendency to shy from uncertainty
with the reality of the cost of certainty.

ROE does not endorse common shortcuts which round up to "cover" uncertainty,
as these ultimately _increase_ risk by inflating the apparent project cost,
increasing the probability of loss to a competitor.

Bid risk may fit a [Taleb distribution](https://en.wikipedia.org/wiki/Taleb_distribution).

Actuarial Science