How can an organization avoid certain risks?

Discontinuing costly activities or assets is a strategic approach that allows an organization to avoid certain risks by eliminating areas of financial burden or inefficiency. When an organization identifies activities or assets that are not contributing positively to its bottom line or imposing excessive risk, discontinuing them can improve financial health and reduce vulnerability. This can lead to better allocation of resources and more focus on core operations or profitable ventures. By cutting these costs and removing ineffective elements, an organization can enhance its overall risk management strategy, thus enabling more effective and resilient business operations.

Increasing employee bonuses, hiring additional staff, or enhancing marketing efforts do not directly correlate with avoiding risks. While they may contribute to boosting morale, operational capability, or market presence, they do not necessarily address or mitigate fundamental risks that could affect the organization's stability or profitability. Consequently, these options lack the targeted impact on risk reduction that comes from the decision to discontinue costly activities or assets.