exploring the social in social risk

PURPOSE

The fundamental nature of social risk merits rethinking given the pervasive impact of social media technology, conversational computing and generative AI.^[1] The problem is rethinking social risk involves incorporating subjective, social behaviour into what is largely an objective paradigm of risk.

This website describes our work exploring the value added to social risk management with key perspectives borrowed from the Social Sciences.

We look at risk identification as a social construct, focusing attention on the planner and their environment. Uncertainty, as the feeling of doubt in a prediction, arises naturally in any social context. Risk, as a subjective invention, completes the prediction like a missing puzzle piece.
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A broker has little to offer an uncertain stock market sensing something might happen, but a market characterized with a 10% risk of dropping 20% is focused and active.[2]

The thing in thinking about something, is subjective, of the brain. Science and engineering begin subjectively. But this does not preclude the thing acquiring materiality independent of the thinker, of being objective. How objectivity comes about is a key element of our exploration of social risk.
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Risk is constructed with predictions, with expectations of risk-events that might happen. The problem is- there is no limit to the number and complexity of such events. To address this, we explore an additional step, from behaviour to belief,^[3] reaching beyond unlimited possible events to the underlying belief systems directing behaviour. The goal is to provide strategists and risk managers with tools to test their plans for robustness against social risk and deception.

SOCIAL IS RISKY BUSINESS

Being social involves communication and feedback, sending and receiving messages. Individuals have their own interpretation of messages- what they mean and how to respond.^[4] All of which results in some level of uncertainty, the irritation of doubt. For a sender, uncertainty is about the response to their message or action; will they be successful? Or misunderstood and misjudged? For the receiver, uncertainty is about the message received; what was really meant? Is the message fake or deceptive? Has the context been tampered with?

Communication involves signs, symbols such as words, gestures or actions whose meaning is arbitrary and uniquely learned by each individual.[5] The sender may believe the fact that X counts-as or means Y, but they do not know for certain what X means to the Receiver. Similarly, the Receiver cannot be certain about what X means to the sender.

The receiver's interpretation of communication is based on beliefs hidden to the sender. Risk emerges naturally, inevitably as part of human behaviour. Just as someone learning to fit into a social group risks rejection, a company marketing a new product risks its reputation.To be social is to risk.

The focus of social risk herein is the subjective risk of groups forming and doing real things, such as ruining brand reputation, but only because of commonly held beliefs.

Risk ... of what?

The number of possible risk-event predictions at any point is limitless; what else could happen?. By asking, might anything significant happen, by stepping into the belief system(s) that guided the behaviour, a more stable structure is exposed that is closer to the root cause of multiple risk events.^[6]

Whilst the relationship between belief and behaviour is complex, the planner and risk manager are often interested in simpler questions; do they think like us? Will they react as we think they will? Prediction then is not of events, but differences in belief systems. The mental model of a planner, as observer, becomes a system diagram to identify relationships at risk.

Misprediction can present at any point.[7] For example, a risk engineer (Observer) might identify 2 relationships of concern: a manufacturer (Individual) has learned from a consult (Group) that a feature X counts-as a compelling reason to purchase (Y). But until product release the manufacturer remains uncertain whether the feature will actually be popular in the market (Society).

ESTIMATING THE DIFFERENCE

Analogous to DNA profiling, we explore the value of conceptualizing social risk as the difference between the beliefs of two groups- as the potential for disruption, be it positive or negative. For example, the beliefs that direct an organization's design thinking versus those of their customer.

In the first step of a 2-step process in development, the knowledge and experience of content experts is harnessed in developing a semiotic scenario matrix to focus the study. In step 2 the scenarios are refined with quantitative estimates of social risk using natural language processing.

Traditional scenario-based risk identification provides an event-based structure where scenarios are defined by major objective trends in the environment. This helps to reduce a unlimited number of possibilities to something more useful and manageable. Semiotic scenarios attempt to go deeper by following sign posts of difference.

Semiotic scenarios estimate the compatibility of belief systems, which then can be used to test the robustness of critical assumptions and to plan mitigation strategies aimed at reducing the misalignment. They provide additional, more enduring insight into undifferentiated trends; a deeper structure within which to think about the future.
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Communication in natural language provides a unique opportunity to estimate the beliefs with which a text is constructed. Discourse reduces complex mental activity to word streams available for analysis.

The meaning of a message in natural language is to be found in the relative distribution of words and the contexts in which it was constructed and interpreted. To the extent such distributions represent their constitutive belief systems, a comparison of word distributions is a differential measure of beliefs that enhances the utility of semiotic scenarios. Analogous to DNA profiling, we are exploring how to transform word choices into unique identifiers, or signatures,^[8] whose differences provide measures of risk and deception.
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