In the risk assessment process, "System characterization" is the initial step where the scope of the assessment is defined. This involves identifying and documenting the boundaries of the IT systems under review, the resources (hardware, software, data, and personnel) that constitute these systems, and any relevant information about their operation and environment. This foundational step is essential for understanding what needs to be protected and forms the basis for subsequent analysis, including identifying vulnerabilities, assessing potential threats, and determining the impact of risks to the organization.