Proposing A Muslim-Friendly Hospitality Regulatory Framework Using Systems Approach Ahmad Sahir Jais, Azizan Marzuki
Proposing A Muslim-Friendly Hospitality Regulatory Framework Using Systems Approach Ahmad Sahir Jais, Azizan Marzuki
ABSTRACT
Muslim-Friendly Hospitality (MFH) is considered a new trends in tourism and hospitality which has
gained attention among industry player, locally and abroad. The attraction is due to the growing number
of Muslim’s who requires their faith-based needs, satiated when travelling and engaging in activities
beyond their home. MFH adoption is far less strict than Shariah Compliance (SC), which commands to
the adherence of Islamic teaching on every aspect of the hospitality operation and management. To
ensure the integrity of MFH practices, a regulatory framework for MFH is proposed. Extensive
literature and documents analysis were conducted as primary methodology for this paper. Data
gathered, were coded and analysed qualitatively, to grasp the relationship between every element in the
MFH regulatory framework. An MFH regulatory framework is then proposed and benchmarked upon
the regulatory framework used in the Malaysian Halal industry. A systems based approach was chosen
to be the illustrative apparatuses to explain better the regulatory framework as a continuous, robust
systems that will be the core of the MFH ecosystems. The regulatory framework consists of Government
Policy, Laws and Regulation, comprises of Implementation Guidelines, Manual procedures and
Circulars and the lowest level, Quality Standards & Term of References. At the operational level, the
MFH Management Systems will the guiding-governing tools, keeping the Muslim-Friendly practices
intact. The adoption of MFH practices as a fully functioning and organised systems is still in its infancy,
although some of its elements have been practices unintentionally over the years by industry player.
Realigning of efforts and resources through creating comprehensive regulatory framework will ensure
the sustainability of MFH practices, and ultimately will give Malaysia an added advantages as a premier
destination for Muslim tourist.
1. Introduction
There are loopholes in the Muslim-Friendly Hospitality regulatory framework. The need to define and
established a Muslim-Friendly Hospitality (MFH) regulatory framework is a grave concern in the
development of Islamic Tourism in Malaysia (Islamic Tourism Centre Malaysia, 2013; Samori,
Rahman, & Zahari, 2017). By looking at the pace and progress of MFH and Islamic Tourism, problems
loom at the horizons. MFH is the new niche in the tourism and hospitality sectors. This niche area has
gain attention among industry player, locally and abroad (Committee for Economic and Commercial
Cooperation of the Organization of Islamic Cooperation (COMCEC), 2016). The attraction is due to
the ever-growing number of Muslim who requires their faith-based needs to be satiated when travelling
and engaging in activities beyond their home. MFH adoption is far less strict than Shariah Compliance
(SC) practices, which commands to the totality of Islamic teaching on every aspect of the operation and
management. A regulatory framework of MFH is suggested to ensure the integrity of MFH practices,
according to Islamic teaching.
There three (3) primary areas in MFH, Accommodation, Tour packages and Tourist Guide according
to the MS2610:2015 Standards (Department of Standards Malaysia., 2015). Figure 1 detailed out the
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Presented at the 2nd Mini Symposium on Islamic Tourism 19th -20th April 2018 Putrajaya Malaysia. Organized by The Islamic Tourism
Centre (ITC), Ministry of Tourism and Culture Malaysia
core elements of MFH, as well as each of the sub-elements. For this paper, the scope of the discussion
will focus on these elements of MFH.
Figure 1. Elements in the Muslim-Friendly Hospitality
As benchmark case for this paper, the Malaysian Halal regulatory are studied. In the early and mid of
2000, a series of Halal logo were inundating the Halal market in Malaysia, of which some are dubious
in characters and implementation (Hassan & Hanif, 2017). Halal Self-declaration were also rampant to
the extent of which, anyone could declare their products and services as Halal, with no legal
repercussion from the authority. Department of Islamic Development Malaysia (JAKIM) and State
Religious Department (JAIN), act as the sole regulatory bodies at that time were unable to stop these
dubious practices and usage of dubious Halal logo and declaration as no substantial legislation could
pursue this type of cases in the court of law effectively. To make matter worse, back then, the
administration of Halal were under the purview of JAKIM, an agency under the Prime Minister
Department. Oppositely, the governing Act and legislation, The Trade Description Act 1972 (TDA
1972), were under the purview of the Ministry of Internal Trade, Consumerism and Cooperative
(KPDNKK). The TDA 1972 were insufficient to stop this rampant use of the non-sanctioned Halal logo.
Not until the repeal of the TDA 1972 in the year of 2011, a better and improved version of trade
description act was introduced, The Trade Description Act 2011 (TDA 2011). The reason why, faith-
based need certification or Halal by itself is so attractive to the business entities, to the extent that
business operator willing to take the risk of getting a dubious certificate or do a self-declaration, could
be related to the monetary gains and benefits from having one. Malaysia Population is dominated
mainly by the Malays and Bumiputra’s (Son of The Soil), followed by the Chinese, Indians and another
minority ethnicity. The Malays and bumiputras make up almost 68.8 % of the population, where the
majority of which, is a practising Muslim (Department of Statistics Malaysia, 2016). The Number
makes Muslim’s among the most significant market share in existence.
The purposes of this paper are to identify the relevant regulatory elements which relate to MFH practices
and to suggest a regulatory framework which has the following effect towards the implementation of
MFH in Malaysia. A suitable regulatory framework will ensure that MFH practices will adhere to,
regarding administration, certification, enforcement and capacity building capabilities.
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Presented at the 2nd Mini Symposium on Islamic Tourism 19th -20th April 2018 Putrajaya Malaysia. Organized by The Islamic Tourism
Centre (ITC), Ministry of Tourism and Culture Malaysia
2. Literature Review
In a Systems Approach to Management, the organisation, viewed, as an organic and open/closed
systems consist of interrelating, nested and symbiotic parts known as a subsystems (Spears, 2000). In
this approach, the management’s inner working is considered as a subsystems, functioning in unison,
integrated into a single super-systems which leads to organisational effectiveness. Prerequisite to
systems approach is that every component must be interrelated and codependent with each other. This
interrelation and dependency form a working and efficient systems (Ryan, 2008). For a systems to work
smoothly, it must have a hierarchical order of subsystems. The smaller subsystems is supporting, the
larger subsystems. Features that are unique in a systems approach, among others, regard the systems as
varied consisting of interacting elements. It is a set of interrelated and interdependent parts arranged in
a manner usually in a hierarchical structure that produce a unified super systems (Spears, 2000). In this
case, to adopt a systems approach, the various sub-systemss should be studied in their inter-relationships
slightly, then in isolation from each other. In the MFH, Government Policy, Laws and Regulation,
comprises of Implementation Guidelines, Manual procedures and Circulars and Quality Standards &
Term of References, has their subsystems. Organisational systems boundaries are then assessed to
determine which parts are internal (Micro) and which are external (Macro). Linkages and interrelation
between elements need to be recognised as a systems does not exist in a vacuum. It receives information,
material and energy from other systems as inputs. These inputs undergo a transformation process within
a systems and leave the systems as output to other systems. An outcome of this process will create
feedbacks. It should be noted that an organisation is a dynamic systems as it is responsive to its
environment. It is vulnerable to change in its environment.
To remain competitive, the tourism regulator needs to devise a plan that will put Malaysia ahead of its
competitors. On the global scale, Malaysia ranked the 26th spot on the global competitiveness report of
travel and tourism (World Economic Forum (WEF), 2017). Among the items used to rank the
competitiveness is the Travel and tourism policy as well as the enabling conditions. The same report
also cited, for travel & tourism policy, Malaysia scored 4.7, slightly below South-East Asia average of
5.0 marks. Despite this, we are still lagging behind Singapore, Thailand, Indonesia, Sri Lanka and
Cambodia regarding tourism policy. All this, somehow points out that current and existing policy on
tourist development inadequately covers the whole spectrum of the ever-changing tourism industry in
Malaysia. This policy also includes some critical regulatory requirements (Giap, Gopalan, & Ye, 2016).
Viewed as precedence, the Halal regulatory framework in Malaysia is used as the basis for the proposed
MFH regulatory framework. The Malaysia Halal regulatory framework is considered as adequate where
all matters on the management of Halal and Halal certification are defined. The strength of Halal related
rules and legislation draw its statutory power from the TDA 2011. Section 28 and 29 of the TDA 2011,
explicitly defines Halal markings, the Halal definition, as well as delineating the power of authority to
the relevant agencies that oversee the running and function of Halal related matter in Malaysia. The
credibility of the Malaysian Halal certification is derived from this said Act. The Halal ecosystems also
derived its statutory power through numerous supporting Act and legislation such as the Trademark Act
1975, Food Act 1983, and a series of state-enacted legislation. The regulatory framework is overseen
by a governing body, in this case under the purview of Halal Hub, Department of Islamic Development
Malaysia (JAKIM). Two essential regulatory functions that are given by JAKIM is the monitoring and
enforcement of Halal, as well as, the single certification bodies for Halal in Malaysia. Among the
improvement that was introduced among other is JAKIM ‘s function as the only Halal certification
bodies entitled to issue the Halal certificate within Malaysia, self-declaration of Halal was considered
as illegal, controlling the terms and expression of the word “Halal” and higher penalty of Halal related
offences. This landmark change has restructured the Halal industries to what it is today. Consumer
confidence towards the Halal certification and Halal industries were improved along the way (Ismail,
Othman, Rahman, Kamarulzaman, & Rahman, 2016; Shafiq, Haque, & Omar, 2015).
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Presented at the 2nd Mini Symposium on Islamic Tourism 19th -20th April 2018 Putrajaya Malaysia. Organized by The Islamic Tourism
Centre (ITC), Ministry of Tourism and Culture Malaysia
By using the Halal regulatory framework as a benchmark, several aspects of the MFH regulatory
elements have been identified along with the specific provision. The elements were arranged according
to its hierarchical importance and standing in the regulatory perspectives. The elements consist of
government policy, Legislative elements (Acts, Orders & regulation), manual and guidelines, standards,
as well as circulars. For discussion all, regulatory elements which relate to the tourism industry were
listed to give an in-depth overview of the legislative plethora.
3. Methodology
For this paper, an extensive review of secondary data is used as the primary data collection method.
Detailed analysis of legislative documents including Acts, Legislation, Standards, guidelines and
circulars were conducted. Data Findings were openly coded, stratified and the analysed, and translated
into graphical charts representation in Atlas ti. 8, to build and show the relationship of critical regulatory
component and network. Comparative analysis of the existing regulatory framework for Halal
industries was used as the benchmark and foundation for the Muslim Friendly Regulatory framework
suggestion. The relationship of the governing regulatory elements is then translated into the systemsic
visual representation to better explain on the regulatory practical’s foundation. A systems approach is
then suggested for the MFH regulatory framework.
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Presented at the 2nd Mini Symposium on Islamic Tourism 19th -20th April 2018 Putrajaya Malaysia. Organized by The Islamic Tourism
Centre (ITC), Ministry of Tourism and Culture Malaysia
Source: (Department of Standards Malaysia., 2015; Department of Standards Malaysia, 2009, 2012;
Government of Malaysia, 1992; Hasri, Taib, & Ahmad, 2016; Samori et al., 2017)
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Centre (ITC), Ministry of Tourism and Culture Malaysia
Source: Adapted from Spears (2000) Foodservice Organizations - A Managerial and Systems
Approach
According to Spears (2000), the process of production can be defined using a systems approach. Three
significant activities are associated with this approach, the Input, Transformation and Output, as shown
in Figure 2. This three activity is considered as a subsystems on their own. Input for the MFH consists
of Human Capital, Capacity Development, Materials and Supplies, Facilities and Operational as well
as Shariah Principles and practices. In the second part of the process, is the Transformation. There are
three smaller subsystemss used to transform the input into a working and functional output. The
subsystems is known as Management Function, Functional Subsystems and Linking Process. The
output meanwhile, will be the Muslim-Friendly Services, Muslim-Friendly Products, Customer and
Employee Satisfaction and also Shariah Compliance Accountability. The ancillary process, which
deemed detrimental to the running of the systems are the Muslim-Friendly Control, Records, and
Feedbacks. The diagram also shows the interrelation between larger subsystems, and smaller
subsystems, creating a continuous process in a loop, hybrid systems. With references to the regulatory
framework of the Halal industry, a regulatory framework is suggested for MHF practices. However, the
MFH segment is a comparatively broader in nature as it involved three distinctive specialisation, which
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Presented at the 2nd Mini Symposium on Islamic Tourism 19th -20th April 2018 Putrajaya Malaysia. Organized by The Islamic Tourism
Centre (ITC), Ministry of Tourism and Culture Malaysia
is the Food and Beverage, Accommodation and Travel and Tours (Department of Standards Malaysia.,
2015).
Source: Adapted from Spears (2000) Foodservice Organizations - A Managerial and Systems
Approach
Each dotted box in Figure 3, signifies a smaller subsystems with their process. In systems approach,
each of this subsystems in contingent to each other as the outcomes will affect the rest of the subsystems
in a continuous loop. In this case, it starts with the Government Policy. The government will dictate the
direction of the industries, by creating policy and environment that support the development of the Halal
industry, which among other creates capabilities, infrastructure, capacity building, human capital
development and also financial support. At this stage also, the government will also determine which
lead agency to take the administrative role in maintaining the systems. Below, is the discussion of the
element existed in the MFH regulatory framework.
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Presented at the 2nd Mini Symposium on Islamic Tourism 19th -20th April 2018 Putrajaya Malaysia. Organized by The Islamic Tourism
Centre (ITC), Ministry of Tourism and Culture Malaysia
on Islamic Tourism and also to introduce a systematic quality assurance and accreditation systems
for MFH practices. Implementation of this tourism-related policies is seen to be more important
than the formation of the policies itself, thus should be based on the bottom-up approach to
sustaining Malaysia as a premier tourism destination (Khairil Wahidin Awang & Yuhanis Abd
Aziz, 2011).
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Presented at the 2nd Mini Symposium on Islamic Tourism 19th -20th April 2018 Putrajaya Malaysia. Organized by The Islamic Tourism
Centre (ITC), Ministry of Tourism and Culture Malaysia
control measure, the installation of Halal Assurance Systems (HAS) within an organisation is
sufficient to preserve and protect the integrity of the Halal products through better management of
Halal practices and meeting Shariah requirement (Halal Hub Division Department of Islamic
Development, 2012; Halal Hub Divison JAKIM, 2014). It is proposed, to be used together with the
standards, an internal control systems that will ensure the accountability of the MFH practices
through systemsatic management. This internal control systems will ensure that all Shariah
requirements are met before, during and after conferring the Muslim Friendly status. The control
systems need not be too elaborate and extensive as to the Halal Assurance Systems (HAS), just
adequately address the Shariah concerns and Muslim’s requirements. A control systems also has
been highlighted in the MS2610:2015 Muslim-Friendly Hospitality Services standards.
Summary
There still loopholes in the Muslim Friendly Hospitality (MFH), particularly a transparent MFH policy
as well as an MFH legislation which has standing power to oversee the functionality of MFH practices
being implemented on a commercial basis. Lesson learned from the Halal Certification, and Halal
Ecosystems in Malaysia provided valuable insight, on the repercussion and effect of a firm and robust
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Presented at the 2nd Mini Symposium on Islamic Tourism 19th -20th April 2018 Putrajaya Malaysia. Organized by The Islamic Tourism
Centre (ITC), Ministry of Tourism and Culture Malaysia
regulatory framework. Each element if the subsystems in the MFH regulatory framework must work in
tandem with each other, as seclusion and cessation will render each of the subsystemss as ineffective.
By having the regulatory framework, transposed into a systems approach, the linkages are well defined,
and connections are acknowledged. A firm, credible and all encompassed regulatory framework will
create a sustainable ecosystems of MFH practices in Malaysia.
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