19 lines
764 B
Markdown
19 lines
764 B
Markdown
# Risk Oriented Estimating
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Risk-Oriented Estimating (ROE), is a methodology for [[construction-estimating]]
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which prioritizes estimating tasks by their contribution to cost certainty,
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and determines the appropriate level of [[estimating-detail]]
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given [[risk#Risk Tolerance]]
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ROE leans heavily on [[expected-value-of-perfect-information]],
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which challenges the natural tendency to shy from uncertainty
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with the reality of the cost of certainty.
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ROE does not endorse common shortcuts which round up to "cover" uncertainty,
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as these ultimately _increase_ risk by inflating the apparent project cost,
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increasing the probability of loss to a competitor.
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Bid risk may fit a [Taleb distribution](https://en.wikipedia.org/wiki/Taleb_distribution).
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Actuarial Science
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