CIMA E2 Syllabus C. Managing projects - Risk Map and TARA - Notes ^{4 / 5}

There are 4 strategies for managing risk, they are known as the TARA Framework

If a risk:

Has high impact and low likelihood. It should be transferred.
Has high impact and high likelihood. It should be avoided.
Has low impact and high likelihood. It should be reduced.
Has low impact and low likelihood. It should be accepted.

For example, a supermarket chain that commits to sell high quality meat, is looking for a fresh meat supplier.
They are approached by a supplier who provides low quality meat for a cheap price, if they use this supplier, this would go against the company's commitment to sell high quality meat and damage their reputation.
This risk would be considered to be high impact with high likelihood, and the risk response strategy would be to avoid.

Where an event is uncertain, contingency plans can be used.

SWOT analysis can be used to highlight the strengths, weaknesses, opportunities, and threats of different project proposals.