You are the program manager for your organization. Management is considering a new program but they are worried about the program risks that may affect the program success. You know that there are…

Avoidance changes the program plan to eliminate the risk entirely, rather than handing ownership of it to a third party.

Sharing is a positive risk response used to allocate ownership of an opportunity to a third party that is better positioned to capture the benefit, not to transfer a negative risk.

Transference involves contracting with an outside party - such as hiring a vendor, purchasing insurance, or using fixed-price contracts - so that the third party assumes responsibility for managing and bearing the consequences of the risk event. It does not eliminate the risk, but it moves the financial and operational burden away from the program team. This is the appropriate strategy when management wants a third party to own the risk.

Mitigation reduces the probability or impact of a risk event but retains ownership of the risk within the program team.