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Technology risk calculation

Technology risk calculation

Assess the technology risks of your business applications by calculating their risks first at the software model level and then at the business application level.

Calculating technology risk at the software model level

Figure 1. Illustration on the calculation of technology risk at software model level
An example showing how technology risk is calculated at the software model level

Risk on a software model is calculated based on four parameters, namely internal lifecycle stage, external lifecycle stage, internal ageing, and external ageing.

Lifecycle stage: Internal and External

The range set for a risk value at each level such as very high, high, moderate, low, and none vary from one organization to another. You can set the risk value for each lifecycle phase based on your organizational requirements. Use the software model lifecycle form to associate the lifecycle phase for each software model with a risk. Based on the selected risk the parameter risk is determined.

The risk values in the lifecycle table are very high, high, moderate, low, and none. Accordingly the risk is also very high, high, moderate, low, or none.

For lifecycle stage parameters, only the risk value is considered irrespective of the lifecycle phase.

Ageing: Internal and External

Similarly, the ageing internal and external has the following risk values:

  • 0 to 90 days is high risk
  • 90 to 180 days is moderate risk
  • more than 180 days is low risk

Based on the lifecycle internal and external stages and the ageing internal and external stages, the risk of the software model is calculated as follows:

  • If there is a single High risk, then the risk of the software model is High.
  • If there is a single Moderate risk, then the risk of the software model is Moderate.
  • The risk of the software model is Low only if the risk of all the underlying components are Low.
Note: After calculating the risk at the software model, the risk at the business service level (based on the risks of all the underlying software models) is calculated. Then, the risk at the business application level (based on the risk of the production instances which are nothing but production business service) is calculated.

The risk calculation for ageing parameters are scripted and you can edit as required.

Calculating technology risk at the business application level

A business application can run on many software models. The risk of a business application due to its underlying software models is derived from the risk of the individual software models.

Figure 2. Calculating risk at the business application level
Calculating technology risk at the business application level
  • If one of the software models is at High risk, then the business application is at High risk.
  • If one of the software models is at Medium risk, then the business application is at Medium risk.
  • The risk of the business application is Low only if all the underlying software models have a Low risk.