Expected value
The probability-weighted sum of the three scenario outcomes: (P-conservative x Value-conservative) + (P-moderate x Value-moderate) + (P-aggressive x Value-aggressive). A single summary number that respects the uncertainty; healthy cases have an expected value near the moderate scenario rather than propped up by the aggressive tail.
Defined in 2 GAGE programs, which carry 2 distinct definitions of it. The wording above is taught in Business AI Transformation.
How each discipline defines it
The same term does different work depending on who is using it. These are the definitions as each program teaches them, unedited.
The probability-weighted sum of the three scenario outcomes: (P-conservative x Value-conservative) + (P-moderate x Value-moderate) + (P-aggressive x Value-aggressive). A single summary number that respects the uncertainty; healthy cases have an expected value near the moderate scenario rather than propped up by the aggressive tail.
Probability times severity, summed across scenarios; the correct method for representing low-frequency, high-severity tail costs without overstating the typical case.
Where it is taught
The exact lessons this term appears in. The first 7 topics of every program are free with a free account.
- Workslop Cost Quantification: Hidden Productivity Losses · Bonus: AI Leadership Accelerator, AI Literacy & Professional Conduct
- Value Creation and ROI Modeling: Your Three-Scenario Value Model · The Economics and the Business Case, Business AI Transformation
Terms it appears with
Not an alphabetical neighbourhood: these are the terms taught in the same lessons, ranked by how often they appear together.