Risk Management as Applied to Safety, Security, and Sanitation

Reviewer
Risk Management Concepts Principles
• Risk – according to UNWTO, is a situation that exposes someone or something to danger or loss. It
is defined by the business dictionary as the probability of threat of damage that is caused by
external or internal vulnerabilities. In the POV of economics, it implies future uncertainty about
deviation.
It can be a physical safety matter, a risk of property loss or a financial risk business risk.
• Risk VS Hazard
Hazard – pertains to any source of potential damage (e.g. fire, knife)
Risk – chance that any hazard will cause harm to somebody (e.g. burned, cuts)
• Risk Management – is the identification, evaluation, and prioritization of risks.
1. Identify risk 4. Implement
2. Risk assess and analyse 5. Measure, control, and monitor
3. Plan action
• Sources of Risk
Uncertainty in financial markets – like inflation
Threats from projects failures – unsuccessful business
Legal liabilities – safety of the guest and employees, and also protection to business.
Credit risk – is the potential that a bank borrower will fail to meet its obligation.
Accidents – reactive and not preventive.
Common injuries in the hospitality management:
➢ Slip and fall injuries ➢ Security related accidents
➢ Musculoskeletal injuries ➢ Food poisoning
➢ Skin reactions ➢ Elevator and escalator
➢ Respiratory illness accidents
1. Accidents due to fortuitous events or acts of God
➢ Earthquakes ➢ Erosion
➢ Volcanic eruption ➢ Fire
➢ Flood ➢ Storm
➢ Landslide ➢ Typhoon
2. Transportation Accidents
➢ Air ➢ Land
➢ Water
3. Accidents due to activities
➢ Pool accident ➢ Drowning
➢ Animal bites or attack ➢ Electrocution
Natural causes and disasters
Categorized into three broad groups:
➢ Caused by movements of Earth
➢ Disasters related to weather.
➢ Floods, mudslide, landslides, and famine
Deliberate attack from an adversary – terrorism has become one of the active and
threatening calamities that affect the international community.
Events of uncertain or unpredictable root cause – negative events or risk or positive
events opportunities are the two types of events in risk management
• Strategies to manage threats
Avoid threats
Reduction of the adverse effects or probability of the threat
Transfer of all part of the threat to another party
Retaining some or all part of the potential or actual consequence
• Methods on how to implement the strategies to manage uncertainties
Threat identification or characterization
 Assessment of the vulnerability of critical assets to specific threats
Risk determination
Identification of the technique to reduce those risks
Prioritization of the measures.
• Steps on risk management process
1. Context establishment
2. Identification of the potential risk
3. Risk assessment
4. Creation of risk options
5. Identification of potential risk management treatments
6. Make a risk management plan
7. Execute the plan
• Identification of the potential risk
Classification of risk sources
1. Internal
2. External
Methods of identifying the risk
1. Culture
2. Industry practice
3. Compliance
• Risk Assessment – is the stage wherein the severity of the risk is being weighed to make decisions.
It is the determination of the quantitative and qualitative estimate of risk.
Techniques in managing risk may be categorized into the following:
1. Avoidance 3. Sharing
2. Reduction 4. Retention

Establish and Maintain Safe and Secure Workplace

• Ensuring the health, safety, and security is the single most important concern of all managers.
• 75% of workplace accidents and injuries are avoidable.
• Health, safety, and security of all people is achieved through:
Establishing management commitment
Consultation with external experts
Identifying rights, obligations, and responsibilities
Implementing policies and procedures
Ensuring suitable safety and security resources
Training staff
Identifying all potential risks and hazards
Assessing risks and hazards
Controlling risk and hazards
• Health – physical and mental state of a person with freedom from disease or ailment
• Safety – being free from the occurrence or risk of injury, danger, or loss
• Security – something that secures or makes safe with freedom from risk
Health, Safety, and Security aims to protect the physical safety and security of the:
➢ Business (profit, reputation, ➢ Staff
liability) ➢ Guests
➢ Assets ➢ Public
Responsible for safety and security in the workplace:
➢ Management ➢ Customers
➢ Our selves ➢ The public
➢ Fellow employees
• Legislation – laws that will identify the responsibilities and actions by employer and employees.
Occupational Health and Safety Act – referred to as “The Act”. Overview of duties and
rights.
It aims to:
➢ Secure the health, safety, and welfare of employees
 ➢ Protect the public
➢ Eliminate workplace risks at the source
➢ Involve the organization in the formulation and implementation of it.
• Duty of Care – employers have a legal responsibility to provide a reasonable standard of care that
could foreseeably cause harm to people.

Risk Management Applicable to the Industry of Tourism

• Technological Hazard
Originated from technological or industrial conditions, dangerous procedures,
infrastructures failure or human activity.
Effect of the globalization product, increase of industrialization and accidents connected
with production, processes, transportation, and waste management.
Example:
➢ Industrial pollution ➢ Transportation accidents
➢ Nuclear radiation ➢ Factory explosions
➢ Toxic waste ➢ Fires, and:
➢ Dam failures ➢ Chemical spills

• Biological Hazard
Disease outbreaks including human, animal, and plant epidemics and pandemics
Carrying disease from one place to another, causing the spread and mutation of it.
Organic substances that present a threat to the health of people and other living organisms.
Biological Agents and Routes of Transmission:
➢ Hepatitis B – bloodborne
➢ E. coli – food-borne
➢ Influenza – direct/indirect contact, droplet, aerosol
Examples:
o Mold and Fungi o Stinging insects
o BloodandBodyFluid o Harmful plants
o Sewage o Animals and bird
o Airborne pathogens droppings

• Steps to Avoid Technological and Biological Hazard

Risk Identification – includes all risks inside or outside the control of destination or
government, it uses various methods like brainstorming, flowcharts, checklist, records,
and experience.
Risk Reduction – measure to reduce the severity of losses (loss control). May include
engineering, fire protection, safety inspections, or claims management
Use of Safety Devices
Top 10 items used in PPE
➢ Clothing ➢ Harnesses
➢ Respiratory protective ➢ Skin protection
equip. ➢ Protective footwear
➢ Eye and face protection ➢ Sun and heat protection
➢ Head protection ➢ Disposable protect clothing
➢ Hearing protective devices

Fire Warning Systems:

➢ Fire Alarm – can be set off by smoke/heat detectors, sprinkler or pull stations.
➢ Sprinklers – have a sensitive glass bulb that cracks once it reaches certain heat.
➢ Smoke Detectors – trip the alarm system if the smoke exceeds permissible limit.
o Photoelectric detectors – alarm off when smoke blocks a beam of light.
o Ionization detectors – shift of electrical conductivity between two plates.

Hotel’s Guardsmen:
 ➢ Cctv ➢ Fire extinguishers
➢ Fire alarms ➢ Luggage scanner
➢ Smoke detectors ➢ Handheld metal scanner
➢ Sprinklers ➢ Metal detector
Risk Transfer – agreement in which one party pays another to take responsibility for the
losses.
➢ Transferor – company who is going to pay
➢ Transferee/Risk Bearer – who will take responsibility for the losses.
Risk Communication - real-time exchange of information, advice, and opinions to be able
to form a decision and to mitigate the effects of threats.
Principles of Risk Communication:
➢ Timing ➢ Accurate
➢ Transparent ➢ Invalidate rumors
➢ Trust ➢ Media monitoring
➢ Empathy

• Tourism – is a complex industry that involves a broad range of businesses, organizations, and
government agencies to deliver a complete tourism package.
Guidelines to Manage the risks confronting the tourism sector
1. Risk Identification – is the process of determining risk that could prevent the program from
achieving its objective. Include documenting and communicating the concern.
The risk identification could concern any of the following:
Natural Hazards – is an extreme event that occurs naturally and causes harm to humans
 Civil or Political Hazards
➢ Civil Hazards – are caused by circumstances in the society that could affect the
society as a whole.
o Sex tourism – a traveller that would engage sexual activity with prostitutes
o Westernization – is a process whereby societies adopt western culture such
as clothing, lifestyle, language, religion, values, etc.
➢ Political Hazards – hazard being confronted by investors, corporation, and
government brought about by the political decisions.
o Trade barriers o Administration
o Taxes o Political instability
o Legislation
Technological Hazards - Originated from technological or industrial conditions,
dangerous procedures, infrastructures failure or human activity.
Biological Hazards – pertains to biological substance that dangers the health of the living
organisms, also known as biohazards

Risk Managers – specialize in identifying potential causes of accidents and

recommending preventive measures, they coordinate loss control for an organizations
➢ Two essential risk concepts:
I. Inherent Risk – refers to the exposure arising from a specific risk before an
action is to be made by a risk manager
II. Residual risk – is the exposure arising from a specific risk after risk
manager has made action that has proven useful
The following issues must be addressed well in the risk identification
1. The cause of event 4. Events
2. Areas of impact 5. Potential consequences
3. Enablers
2. Determination or creation of a management plan to address risk that could affect tourism
industry
Risk management plan – is necessary to conduct tourism activities and lessen the risk.
➢ Analysis of the potential risk together with possible impact (high or low)
➢ Strategies to mitigate the derailment of the project if the problems would arise.
Preventive strategy – is designed to lessen the possibility of risk before it happened.
Contingency – is designed to address the issue of risk during the event.
Strategies of Risk Management:
Risk avoidance – is the elimination of hazards, seeks to avoid compromising events.
Risk reduction – refers to minimizing the risk level through implementation of
precautionary measures, risk control, or treatments.
Considerations of Risk Reduction
➢ Observance of the safety standards
➢ Use of safety devices
➢ Earthquake-proof building/proper waste management system
➢ Qualification requirements
Risk transfer – the burden is shifted from one party to another.
Risk transfer may be accomplished through any of the following:
➢ Outsourcing – it is a process which transfers risk to a partner, usually involves
contracts and may include penalty if not push through,
➢ Derivatives – a financial instrument whose value is derived from the value of another
asset, known as underlying (stocks, bonds, commodities, currencies, interest rates,
market indexes.)
 ➢ Contracts – according to Boggs (2017), contractual risk transfer is a non-insurance
risk transfer mechanism.
➢ Insurance – contract being represented by a policy in which an individual or entity
receives financial protection or reimbursement against losses
Risk retention – company’s decision to take responsibility for a particular risk it faces.
3. Collaboration with the stakeholders

Classification of tourism stakeholders

Internal – has direct relationship with the company (e.g. employees, owners, investors)
External – those who do not have a direct relationship but could affected by the action of
the management (e.g. local community, local government, tourist and guest)
4. Provide training for the staff
Safety drill – is a concept or practice of preparing people for an emergency
First aid – assistance given to prevent or preserve life from worsening.
Safety on transportation
5. Test the plan
Planning
➢ Risk identification
➢ Risk impact analysis
➢ Risk mitigation
Designing
Execution
6. Provide transparent and honest crisis communication
7. The revival of the business after a crisis
8. Reposition of the business after a crisis
Risk Management for Hospitality Industry
• Guest Behavior – considered as the life blood of the hotel
• Staffing – can be a risk that hospitality industry faces with as the quality services that the client
desire at any situation, place, and time.
• Best Practice for Hotel Service Recovery
Deal with complaints the moment they arise
Ensure that the complaints can reach the right person
Build a full picture on guest preference
Keep tabs on recovery service cost
In-depth analysis of the service recovery efficiently
• Liability of Hotel in Personal Injury Claim
The hotel may be held liable in a lawsuit due to negligence or carelessness of the employees.
The liability may arise if it proved that the hotel management acted negligently
• Duties of Hotel to the Guest
1. Inspect the hotel grounds and maintain the property in a reasonably safe condition
2. Maintain adequate lightning, a duty to keep steps dry and unobstructed, and a duty to repair
hotel defects.
3. Control insect infestation.
4. Maintain proper security to avoid theft and assault on guests.
5. Exercise reasonable care in hiring staff.
6. Train Hotel pool staff to prevent injuries to guests.
7. Maintain stairs and elevators.
8. Maintain lock on hotel rooms.
9. There is also a duty to reasonably construct hotel steps or warn guest of unusual staircase
locations.
• Branding – is essential to the decision of prospective guest to avail services of a hotel
• Buying decision
Functional Risk – product performance does not fulfil customer expectation
Physical Risk – product affections of the physical well-being of the user or others
Financial risk – poor price/quality ratio
Social risk – other do not accept the products
Psychological Risk – product affections of the user’s mental well-being
Time risk – opportunity cost of alternative seeking due to product failure