Treat the severe scenario with proportionate controls | AIGP
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Treat the severe scenario with proportionate controls: What response best reflects the low-frequency severe

AIGP Understanding How to Govern AI Development Medium

Low likelihood does not erase severe consequences; the scenario requires proportionate treatment and prioritization.

The question

A retail demand model rarely produces an error that causes a major stockout of essential seasonal goods, although routine forecast deviations are more common and inexpensive. Validation, monitoring, oversight, and documentation are satisfied. What response best reflects the low-frequency severe harm?

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  1. Average the severe stockout with routine deviations in one error rate.
    An aggregate rate can conceal materially different consequences and does not support proportionate treatment of severe harm.
  2. Prioritize routine deviations because they occur more often.
    Frequency alone can divert attention from the rare stockout whose consequences are substantially more severe.
  3. Accept the stockout risk because validation found it infrequent.
    Low frequency does not establish acceptability when consequences are severe and material to affected customers and operations.
  4. Treat the severe scenario with proportionate controls despite its low frequency. ✓
    Risk management should account for consequence severity, so rare but serious outcomes require targeted treatment rather than dismissal.
The trap
Look beyond incident counts when a rare outcome has serious consequences.

How to remember it

Low likelihood does not erase severe consequences; the scenario requires proportionate treatment and prioritization.

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