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Module 1-Lecture Notes 1

The document discusses risk management as applied to safety, security, and sanitation. It defines risk and differentiates between risks and hazards. Risk management involves identifying, evaluating, and prioritizing risks to minimize potential negative events. Food handling, guest information collection, and event organizing are provided as examples of risks and hazards in tourism and hospitality industries.

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148 views

Module 1-Lecture Notes 1

The document discusses risk management as applied to safety, security, and sanitation. It defines risk and differentiates between risks and hazards. Risk management involves identifying, evaluating, and prioritizing risks to minimize potential negative events. Food handling, guest information collection, and event organizing are provided as examples of risks and hazards in tourism and hospitality industries.

Uploaded by

Jan Jan
Copyright
© © All Rights Reserved
Available Formats
Download as PDF, TXT or read online on Scribd
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THC 001 – RISK MANAGEMENT AS APPLIED TO SAFETY, SECURITY, & SANITATION

Let's start our discussion.

DEFINITION OF RISKS

The definition of risk here implies an awareness that risk is something foreseeable
in every kind of business, even in the tourism and hospitality world. The exposure to
something that we do not desire should not be a barrier for us to execute what is being
expected and demanded. Our knowledge of risk should be considered a better opportunity
for us to plan and mitigate its adverse effect in our undertakings.

Risk, according to UNWTO, is a situation that exposes someone or something to


danger harm, or loss. Risk can be a physical safety matter, a risk of property loss, a
financial business risk, and more. From the moment a person engages himself in tourism
and hospitality, whether a sole proprietorship, partnership, or corporation, the risk
immediately attaches.

Examples:

1. Food handling is one issue that must be adequately addressed whenever someone
prepares food for the customers. The danger of food poisoning due to the
contamination of food is high if the necessary precaution based on standards will not

The module is for the ex clusiv e use of the Univ ersity of La Salette, Inc. Any form of reproduction, distribution, uploading, or
posting online in any form or by any means w ithout the w ritten permission of the Univ ersity is strictly prohibited. 1
THC 001 – RISK MANAGEMENT AS APPLIED TO SAFETY, SECURITY, & SANITATION

be followed. The government has provided regulations that must be complied with by
any business venture to make sure that the danger of harm is mitigated. A food
sanitation permit is a mandatory requirement for businesses in the food industry.

2. It is an inevitable practice in both tourism and hospitality businesses to get the


necessary information about their guests and clientele for security reasons, not only
on the part of the guests but also on the part of the management. The giving and
obtaining information per se is considered a risk in itself that must be safeguarded
accordingly.

The business dictionary defines risk as to the probability or threat of damage,


injury, liability, or any other adverse occurrence caused by external or internal
vulnerabilities, which may be avoided through preemptive action (http://
www.businessdictionary.com/definition/risk.htmloccur). The same has stressed the
definition of risk as applied to the food industry: the possibility that there will be an
adverse effect on absolute magnitude due to a particular hazard in food.

Tourism, like hospitality, is a trade or a business. It may sometimes reach its


desired outcome, but the possibility of not realizing it should not be set aside. Engaging
in business-like tourism and hospitality has a probability of threat or damage as there are
events beyond the contemplation of man. The weather as of the time of entering an
agreement with clientele may be entirely different from the actual day of the event. Those
actual occurrences must have a preemptive action.

In the point of view of economics, risk implies future uncertainty about deviation
from expected earnings or expected outcome. Risk measures the uncertainty an investor
is willing to take to realize a gain from an inv estment (https://economictimes.
indiatimes.com/definition/risk). The very reason why people engage themselves in
business is to realize gains that could address their respective economic interests.
However, realizing gain is not an easy thing because of the hazards and risks attaching to
it.

There is a need to plan on time and think of the best possible means to address the
risks and hazards barring the full implementation of the desired plan of the business.
When one is in a simple sari-sari store, there is a hazard of the proliferation of minor and
major competitors.

The same would make one realize the need to deviate from the usual strategy of
capturing the market to a more relevant and significant strategy. When a person is in
the business of transportation, they have to think of the erratic prices of the
oil in the market. When a person is in the business of a travel agency, there
is a chance to deviate the tour packages as an effect of the peso equivalency
in the foreign exchange.

The module is for the ex clusiv e use of the Univ ersity of La Salette, Inc. Any form of reproduction, distribution, uploading, or
posting online in any form or by any means w ithout the w ritten permission of the Univ ersity is strictly prohibited. 2
THC 001 – RISK MANAGEMENT AS APPLIED TO SAFETY, SECURITY, & SANITATION

Risk vs. Hazard

There are instances wherein risk and hazard are being used interchangeably as
they thought they were the same, but the Canadian Center for Occupational Health and
Safety gave a concrete definition to distinguish the two. Accordingly, hazard pertains to
any source of potential damage, harm, or adverse health effects on something or someone,
while the risk is the chance or probability that a person will be harmed or experience an
adverse health effect if exposed to a hazard. It may also apply to situations with property
or equipment loss or harmful effects on the environment.
According to work SMARK (n.d.), a hazard is something that can cause harm, while
a risk is a chance that any hazard will cause harm to somebody.

HAZARD Risk
Anything that can cause harm How great the chance that
(eg. A chemical, electricity, someone will be harmed by
Ladders, etc.). the hazard.

Let us explain further the distinction between the risk and hazard using the
hospitality and tourism industry-related activities as the framework.

Event organizing is effective in boosting the economy of both industries, tourism


and hospitality. One cannot accomplish it in just a wink of an eye. It must undergo a
tedious study and planning because some risks and hazards are attached to it. Guest
performers are considered a hazard as they may cause commotion and stampede because
of the unruly people. Unruly people are also considered a hazard as they can cause chaos
to the whole event process. The overwhelming attendance of guests might also be
considered a hazard as it can cause traffic congestion and noise nuisance to the nearby
establishments. There is a hazard of terrorist attack and robbery as bad elements would
love to take chances of executing an evil design in populated and busy areas. On the other
hand, the risks that those hazards can cause damage to property and injury to people are
very high should the management ignore the essence of risk management in the design of
their event.

There is also a hazard in the food preparation in the hotel industry. The people
preparing might be a factor of hazard as their knowledge, training, and skills are needed
to make sure the foods are adequately prepared. Thus, food contamination is avoided.
The risk of food contamination vis-à-vis with food poisoning is imminent if the one
handling the food has done no precautionary measure. The supplier of the ingredients is
also a factor of hazard. The trouble will come in even if the one preparing the food is
careful in food handling or if the ingredients per se are contaminated.

The module is for the ex clusiv e use of the Univ ersity of La Salette, Inc. Any form of reproduction, distribution, uploading, or
posting online in any form or by any means w ithout the w ritten permission of the Univ ersity is strictly prohibited. 3
THC 001 – RISK MANAGEMENT AS APPLIED TO SAFETY, SECURITY, & SANITATION

As defined in ISO 31000, risk management is the identification, evaluation, and


prioritization of risks. It is followed by coordinated and economical application of
resources to minimize, monitor, and control the probability of unfortunate events
(Hubbard, 2009) to achieve the desired output.

To address the issue of risk, which is inevitable but foreseeable in any business
venture, circumstances must be studied carefully to identify all the risks involved,
followed by an intense evaluation of the same to determine which among those risks
should be addressed first and which should be treated lastly. Risk management, based on
the definition of ISO 31000 and Hubbard, follows a systematic approach to mitigating, if
not eradicating, the risks. Close coordination with the key people in an organization is
something essential to the control of unfortunate events.

The module is for the ex clusiv e use of the Univ ersity of La Salette, Inc. Any form of reproduction, distribution, uploading, or
posting online in any form or by any means w ithout the w ritten permission of the Univ ersity is strictly prohibited. 4

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