Which of the following is MOST important for management to consider when deciding whether to invest in an IT initiative that exceeds management's risk appetite?
Which of the following is MOST important for management to consider when deciding whether to invest in an IT initiative that exceeds management's risk appetite?
When deciding whether to invest in an IT initiative that exceeds management's risk appetite, the most important consideration is risk tolerance. Risk tolerance is the degree of variability in outcomes that management is willing to withstand. It defines the acceptable level of deviation from the risk appetite. This helps determine if the potential returns justify the chances of exceeding the usual risk limits, making it crucial for informed decision-making.
I believe this should be risk tolerance. Risk tolerance is “the acceptable deviation from the level set by the risk appetite and business objectives.”