30 Questions
What is one of the biggest risks for businesses operating in the hospitality industry?
Food safety
How can norovirus be spread in a hospitality business?
By contaminated surfaces or infected people
What may happen if there is an outbreak of norovirus in a hospitality business?
Closure for extensive cleaning leading to Business Interruption costs
Why is it important for owners and managers in the hospitality industry to keep up with current risks?
To address new and emerging challenges effectively
Which of the following is mentioned as a common food-borne infection in the hospitality industry?
Salmonella
What type of claims may a business face due to an outbreak of norovirus?
Workers' compensation claims and bodily injury claims from patrons
What is a key measure to reduce risks related to food safety in restaurants?
Sanitation training for food vendors
Why is it important for employees serving alcohol to hold appropriate licenses?
To avoid complacency and legal issues
What can happen if a business serves alcohol to an already intoxicated patron?
They may face significant consequences
Why should tour operators and hotels be concerned about transportation accidents?
To avoid liability for injuries to passengers
What is essential for hotel employees carrying out transportation services?
Proper risk management considerations
Why should businesses serving alcohol continuously train their employees?
To reduce the risk of safety incidents and legal issues
What may risk models lead organizations to believe?
They can regulate every potential risk
Why might an organization neglect the possibility of novel risks?
Because they are overconfident in their risk models
What is one challenge related to understanding cumulative risk?
Insufficient data availability
Why are some boards of directors required to review enterprise risk management processes?
To scrutinize risk management plans
What has become a major component of business strategy in an increasing number of industries?
Internal audits
Which organizations have developed risk management standards according to the text?
International Organization for Standardization (ISO)
What is the purpose of a risk avoidance strategy?
To deflect as many threats as possible to avoid damaging events
How is risk reduction achieved according to the text?
By adjusting project plans or company processes
What is the purpose of risk sharing as described in the text?
To distribute risks among participants or business departments
When might a company decide to retain a risk according to the text?
When the risk outweighs the anticipated profit
Why is it mentioned that complete elimination of all risk is rarely possible?
Because some risks are inherent in business operations
What is the main difference between risk avoidance and risk reduction strategies?
Risk avoidance aims to eliminate risks, while risk reduction aims to minimize their impact
What is the main purpose of ISO 31000 according to the text?
To provide frameworks for risk management process improvements
What is one of the key principles recommended by ISO 31000 for the risk management process?
Addressing potential errors
Why can't ISO 31000 be used for certification purposes?
It is not designed for that purpose
What is a key aspect of the risk management process according to ISO 31000?
Being based on the best available information
How does ISO 31000 recommend tailoring the risk management process?
Tailoring it based on the project
Which of the following is NOT a recommended target area in the overall risk management process according to ISO 31000?
Ignoring human factors
Study Notes
- Hospitality industry faces constantly changing risks and regulations
- Food-borne illness is a common risk with infections such as salmonella, campylobacter, vibrio, E. coli, and norovirus
- Norovirus outbreaks can lead to significant expenses for business owners, including Business Interruption costs and bodily injury claims
- To reduce food-borne illness risks, restaurant personnel should be trained in food handling, sanitation, and health safety procedures
- Alcohol-fueled behavior poses risks for businesses serving alcohol, including Budget and Reputation Damage, and legal liabilities for serving minors or already intoxicated patrons
- Employees who serve alcohol must hold appropriate licenses and undergo continuous training to avoid complacency
- Transportation accidents are a risk for tour and hotel businesses, with potential liabilities depending on whether the company or a third party provides the service
- After risks are identified, companies can adopt risk management strategies such as risk avoidance, risk reduction, risk sharing, and risk retaining
- Risk models may give a false sense of control, and neglect novel or unexpected risks
- Risk management standards have been developed by organizations like NIST and ISO to help identify threats, assess vulnerabilities, and implement risk reduction efforts according to organizational strategy.
- ISO 31000 principles provide a framework for risk management process improvements, increasing the likelihood of achieving objectives, improving risk identification, and effectively allocating and using resources for risk treatment.
Learn about strategies companies can take to address different types of risk such as risk avoidance, risk reduction, risk transfer, and risk retention. Understand steps that can be taken to prevent loss, recover from a loss, and how organizations can pay for unexpected events.
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