FINALS - MPTH

RISK MANAGEMENT

What is Risk?
“It is any event that negatively impacts normal situations that result in unwanted consequences.
It is a condition in which there is a possibility of an adverse deviation from the desired outcomes.

FOUR SOURCES OF RISK

1. Human and Institutional Environment
2. Tourism and Related Sectors
3. Individual Travelers
4. Physical and Environmental Risks

Human and Institutional Environment

• Common delinquency
(theft, pick-pocketing, assault, burglary, fraud, deception)
• Indiscriminate and targeted violence and harassment
(rape)
• Organized crime
(extortion, the slave trade, coercion)
• Terrorism and unlawful interference, hijacking and hostage taking
(attacks against state institutions and the vital interest of the state)
• Wars, social conflicts and political and religious unrest
• A lack of public and institutional protection services

Tourism and Related Sectors

• Poor safety standards in tourism establishment
• Poor sanitation and disrespect for the environment’s sustainability
• The absence of protection against unlawful interference, crime and delinquency at tourism facilities
• Fraud in commercial transactions
• Non-compliance with contracts
• Strikes by staff

Individual Travelers
• Practicing dangerous sports and leisure activities, dangerous driving and consuming unsafe food and drink
• Traveling when in poor health which deteriorates during the trip
• Causing conflict and friction with local residents, through inadequate behavior towards the local communities or by
breaking local laws
• Carrying out illicit or criminal activities
• Visiting dangerous areas
• Losing personal effects, documents, money and others through carelessness
Physical and Environmental Risk
• Unaware of the natural characteristics of the destination, in particular its flora and fauna
• Not medically prepared for the trip
• Do not take the necessary precautions hen consuming food or drink and in their hygiene
• Exposed to dangerous situations arising from the physical environment
• Traveler’s ignorance or his/her disregard for potential risks

Categories of Risks
• Human Risks
Refers to the type and size of crowd expected, level of crowd participation, public safety and security and
traffic management
• Technological
Includes mechanical utilities such as gas and electricity, equipment, experiments, stage and even costume
malfunction
• Natural
Refers to the physical location and site conditions

Categories of Risks
• Environmental
It includes sudden changes in weather conditions, landslides
• Financial
Refers to the possibility of zero income, low revenues, minimal sponsorships
• Image
The impact of the event

What is Crisis?
• According to Pacific Asia Travel Association, it can be defined as any situation that has the potential to affect long
term confidence in an organization or a product, or which may interfere with its ability to continue operating normally.
• Risk becomes crisis when there is heightened publicity that can cause panic

CATEGORIES OF KEY TOURISM CRISES

• Adversity
• International War and Conflict
• Specific Art of Terrorism
• Crime Wave or well-publicized crime
• Natural Disaster
• Health crisis
• Corruption and scandal

MEDIA TRIGGERS
• Number of people involved
The greater the number, the bigger the “perceived” crisis”
• Types of people involved
Stories where children, underprivileged, minority groups are made a victim
• Prominence of people involved
If the crisis involves a high-profile personality or on with significant connections
• Nature of incident
Repeat incidents, or incidents that are follow-ups or result of previous mishandled incident
• Visibility
Availability of vivid and graphic pictures can encourage unnecessary media attention and spread of rumors
within minutes
• Fear Appeal
The higher the fear factor is for the public, the bigger the crisis
• Conflicting opinions from voice of authority
Confused authorities cast doubts on credibility of information provided

CRISIS MANAGEMENT
• Reduction
Detecting early warning signals of any potential crisis using SWOT analysis
• Readiness
Drills and exercises must be executed to ensure that plans will work during a real crisis.
• Response
This refers to the implementation of strategic and tactical plans
• Recovery
This refers to initiatives to bring normality to the community

What is Disaster?
It is defined as a catastrophic event that severely disrupts the fabric of a community and requires the
intervention of the various levels of government to return the community to normality.
It is a serious disruption of the functioning of a community or a society involving widespread human,
material, economic or environmental losses and impacts, which exceeds the ability of the affected community or
society to cope using its own resources

Impacts of Disaster
• Loss of life
• Injury
• Disease and other negative effects on human, physical, mental and social well-being,
• together with damage to property,
• destruction of assets
• Loss of services
• Social and Economic disruptions
• Environmental degradation

Risk Management
• It is the “systematic process of using administrative directives, organizations and operational skills and capacities to
implement strategies, polices and improved coping capacities in order to lessen the adverse impacts of hazards and
their possibility of disaster.
• It aims to avoid, lessen, or transfer the adverse effects of hazards through activities and measures for prevention,
mitigation and preparedness

Risk Management and Opportunity Analysis

• Risk Management seeks to manage and reduce risks
• Opportunity Management seeks to take advantage of possibilities that can enhance positive outcome
• There have been several man-made and natural disasters and incidents in the past that threatened the tourism and
hospitality industry and society in general
Republic Act 10121 – Philippine Disaster Risk Reduction and Management Act of 2010
Risk Assessment
A methodology to determined the nature and extent of risk by analyzing potential hazards and evaluating
existing conditions of vulnerability that together could potentially harm exposed people, property, services, livelihood
and the environment on which they depend.
Risk assessment with associated risk mapping include: a review of the technical characteristics of hazards
such as their location, intensity, frequency and probability; the analysis of exposure and vulnerability including
physical, social, health, economic and environment dimensions; and the evaluation of the effectiveness of prevailing
and alternative coping capacities in respect to likely risk scenarios

Risk Management
The systematic approach and practice of managing uncertainty to minimize potential harm and loss.
It comprises risk assessment and analysis and the implementation of strategies and specific actions to
control, reduce and transfer risks

Risk Transfer
The process of formally and informally shifting the financial consequences of particular risks from one party
to another whereby a household, community, enterprise or state authority will obtain resources from the other party
after a disaster occurs, in exchange of ongoing or compensatory social or financial benefits provided to that other
party

Philippines: National Disaster Risk Reduction and Management Framework (NDRRMF)

An at strengthening the Philippine disaster risk reduction and management system, providing for the
national disaster risk reduction and management framework and institutionalizing the national disaster risk reduction
and management plan, appropriating funds therefore and for the other purposes adopt a disaster risk reduction and
management approach that is holistic, comprehensive, integrated and proactive in lessening the socio-economic and
environmental impacts of disasters including climate change and promote the involvement and participation of all
sector and all stakeholders concerned, at all levels, especially the local community.

Key Concepts – Sec 3 of R.A. 10121

REPUBLIC ACT No. 10121
An act strengthening the Philippines Disaster Risk Reduction and Management System, providing for the National
Disaster Risk Reduction and Management Framework and institutionalizing the National Disaster Risk Reduction and
Management Plan, appropriating funds therefor and for other purposes.

Government Agencies – Section 5 of R.A.10121

It details the member-agencies of the National Disaster Risk Reduction and Management Council (NDRRMC)
It is headed by the Secretary of National Defense as a Chairperson - Sec. Delfin Negrillo Lorenzana

International Framework for Disaster Risk Reduction (2015-2030)

Sendai Framework for Disaster Risk Reduction 2015-2030
Endorsed by the United Nations, this was signed on June 3, 2015 during the Third United Nations World
Conference on Disaster Risk Reduction held in Japan.

It outlines four priorities under Section IV

Priority 1: Understanding disaster risk
Priority 2: Strengthening disaster risk governance to manage disaster risk
Priority 3: Investing in disaster risk reduction for resilience
Priority 4: Enhancing disaster preparedness for effective response and to “Build Back Better” in recovery,
rehabilitation and reconstruction”
Stakeholders who must be involved in the initiatives:
• Civil society, volunteers, organized voluntary work organizations and community-based organizations to participate,
in collaboration with public institutions, including the following: women, children, youth, persons with disabilities, older
person, indigenous peoples, migrants
• Academic
• Business, professional associations and private sector financial institutions including financial regulators and
accounting bodies, as well as philanthropic foundations, to integrate disaster risk management, including business
continuity, into business models and practices through disaster-risk informed investment
• Media

The Enterprise Risk Management-Integrated Framework

The Enterprise Risk Management-Integrated Framework proposed five techniques to manage risks:
• Risk Avoidance: This involves a proactive decision to remove any possibility of risk through hazard
prevention and cancellation of planned activities
• Risk Reduction: This focuses on decreasing the frequency and severity of damage
• Risk Sharing: This technique refers to the distribution of risk through the participation of another
organization
• Risk Retention: Tourism and Hospitality establishments can opt to shoulder the expenses related to a risk
because the amount is either too small or that the damage is a result of “an act of God”
• Risk Transfer: This refers to damage to property and goods as well as legal liabilities that can be paid for
by an insurance agency

Crowd Control
Physical Crowd
• It is characterized by the density of contact but shows no significant group behavior.
• Also referred to as the conventional or casual crowd, the members come and go and act independently
from each other
• Examples are festival visitors and mall shoppers
Psychological Crowd
• It is an assembly of people who share a common bond and respond emotionally o the same stimuli.
Sports, political rallies, live concerts and parades draw this type of crowds

Types of Psychological Crowd

• Sightseer converge for a specifics. They are usually cooperative and may even be tasked to assist in maintaining
order.
• Expressive Crowds are emotionally involved and may become agitated when approached improperly.

Man-made
• Acts of terrorism
• Assault
• Hostage
• Riots
• War
• Civil disobedience
• Kidnapping
• Factory shutdown
• Rallies
• Political unrest
• Fire
• Hijacking
Natural Phenomena
• Typhoon
• Flood
• Earthquake
• Tsunami
• Mudslide
• Snowstorm
• Hurricane
• Forest Fire
• Tornado
• Avalanche
• Storm
• Medical epidemics
• Heatwave

Hazard
“dangerous phenomenon, substance, human activity or condition that may cause loss of life, injury or other health
impacts, property damage, loss of livelihood and services, social and economic disruption or environmental damage

Hazards Related to Temporary Structures

Structures and barriers are considered dangerous when improperly placed. Some of these hazards are:
• Structures
Garbage, slips, trips, unnecessary fixtures, cables, ponding, uneven ground
• Barriers
Sharp edges, finger traps, openings and gaps and bars
• Toxic
Substances paint, lacquer, gasoline, diesel

Food Safety
• It is used as a scientific discipline describing handling, preparation and storage of food in ways that prevent food-
borne illness.
• The occurrence of two or more cases of a similar illnesses resulting from the ingestion of a common food is known
as a “food borne disease outbreak”

Hazard Analysis and Critical Control Points

A food safety management system to identify and control food hazards before they cause damage recommends from
the following principles of food safety:
• Identify the hazard
• Determine the critical control points
• Establish critical limits
• Establish a system to monitor control of the critical control points
• Establish corrective action to be taken
• Establish procedures to verify that the HACCP system is effective
• Establish documentation
Samples of Special Meals
• Vegetarian – Lacto-ovo, vegan and Asian Hindu
• Religious – Kosher, Muslim, Hindu, Jain
• Dietary – Low salt, low calories, gluten intolerant, low lactose, low fat, diabetic meal, bland, fruit platter, milk
intolerant
• Children – warm water for milk, pureed fruit and vegetables, bitesized pieces, burger and fries
• Allergy-based – no nuts, not spicy, no seafood
• Others – no chicken, branded bottled water, soda in can

Food Hazards
The risks that can be caused by substance or ingredients that can result to an adverse reaction.
• Agro-terrorism
It is defined as a subset of bio-terrorism in which diseases are introduced into the food supply for the
expressed purpose of creating mass fear, physical harm or death and/or economic loss

Types of Food Hazards

• Microbiological: These include bacteria, yeast, molds, and viruses. The World Health Organization lists –salmonella,
campylobacter and enterohaemorrhagic Escherichia as most common foodborne pathogens
• Chemical: These include water, food contact materials, cleaning agents, pest control, substances, and contaminant
from agricultural products such as biocides and food additives
• Physical: These include glass, packaging jewelry, pest droppings and screws
• Allergens: These refers to unintended presence of any ingredients such as milk, eggs, fish, crustacean shellfish,
tree nuts, peanuts, wheat, soybeans, sesame, mustard, sulphur dioxide, lupin and mollusk