Model Failure
From Open Risk Manual
Definition
Model Failure is an operational outcome where a deployed model is found to have serious flaws, obvious and significant bias, is not compliant with regulations etc.
Preemptively and as a means to control more adverse outcomes, a model validation outcome can fail a model that is newly developed or already in production, prompting model redevelopment.
Issues and Challenges
- Objective criteria for defining model failure may not exist in the absence of empirical backtesting possibilities
