This article provides guidance on the management of challenging behaviours (CBs) in dementia care, and introduces concepts from positive behavioural support not usually applied to dementia. While the use of formulations has received a lot of attention in recent years, the mechanisms of how to apply the formulation-led interventions requires more consideration. In order to assist caregivers to deliver effective interventions we need to have a better understanding of the CBs we are attempting to manage, and also produce management strategies with clearer goals. Ideally we would also want caregivers to be able to describe the skills they employ in a coherent manner in order to facilitate self-reflection and to be able to pass on their skills to junior colleagues. This paper attempts to fulfil these needs by integrating two new models with philosophies already used in dementia care. In terms of new concepts, the first is the Arousal Cycle, which gives caregivers an awareness of the five phases of a typical CB (wellbeing, trigger, escalation, CB, and recovery phase). In relation to the second, the Traffic Light analogy examines CBs in terms of four management stages: primary prevention, secondary prevention, reactive strategies, and calming strategies. It is proposed that we distinguish between these stages when composing our formulations and care plans, and thereby produce better targeted interventions. By the end of the paper the reader will have been presented with material integrating concepts from the fields of dementia and intellectual impairment, and been introduced to new ways of managing CBs.