Guide · C69
Size a marketing contingency reserve
Which reserve should be protected without arbitrarily locking a percentage of the budget?
Direct answer
The reserve is calculated from residual exposures weighted by probability, correlation and response time.
01Set the central reserve, ceiling and release rules.
02The rule, the evidence and the next review date stay visible.
How to use this
Move from the question to the deliverable.
Which reserve should be protected without arbitrarily locking a percentage of the budget?
Set the central reserve, ceiling and release rules.
Residual-exposure calculation
Calculation · SQ-69
Size the reserve from residual exposures
A fixed 10% reserve can be too small or tie up resources for nothing. The calculation starts from the risks remaining after the responses already funded.
Fictitious portfolio of €1.35m carrying five material risks and two partially correlated factors.
- 01Cost
Estimate probability and net impact after prevention and transfer.
- 02Correct for dependency
Avoid adding as independent risks that are tied to the same event.
- 03Add the delay
Weight up the risks whose response cannot be funded quickly enough.
- 04Govern
Define the ceiling, the drawing rights and the conditions for returning funds.
Central reserve of €118k and ceiling of €175k
The sum of expected losses is adjusted for correlation and delay, then completed by a volatility cushion.
Central reserve = Σ(probability × residual impact) + correlation adjustment + delay premium| Risk | Probability | Residual impact | Expected loss | Correlation | Response |
|---|---|---|---|---|---|
| Product delay | 30% | €120k | €36k | With launch | Rephase media |
| Sales readiness | 25% | €90k | €22.5k | With launch | Reinforce enablement |
| Media inflation | 40% | €55k | €22k | Low | Reallocate |
| Tracking failure | 20% | €70k | €14k | Independent | Backup measurement |
| Partner unavailable | 15% | €60k | €9k | Low | Alternative channel |
| Adjustments | — | — | €14.5k | Correlation + delay | Reserve |
01Gross expected losses total €103.5k; €14.5k is added for correlation and delay.
02The €175k ceiling matches a documented adverse scenario, not a free envelope.
03Any amount not drawn at the Q3 review returns to the portfolio under a rule fixed before launch.
Illustrative calculation. Subjective probabilities must be dated, assigned and tested in scenarios.
Coherence controls
Minimum conditions before validation.
The status, the evidence and the owner must be available for review.
The status, the evidence and the owner must be available for review.
The status, the evidence and the owner must be available for review.
The status, the evidence and the owner must be available for review.
Usable deliverable
Residual-exposure calculation
Explore the decision further with an interactive control, or start from a structured template to produce your deliverable.