THC1 Notes - Risk Management in Hospitality & Tourism PDF

**2CRISIS --** a challenging situation that demands critical decisions, and actions **RISKS** -- ever-present due to the dynamic nature of these sectors (hospitality and tourism) **RISK MANAGEMENT** -- strategic process used to address potential crises and unexpected events. **TOURISM RISKS**: He...

**2CRISIS --** a challenging situation that demands critical decisions, and actions **RISKS** -- ever-present due to the dynamic nature of these sectors (hospitality and tourism) **RISK MANAGEMENT** -- strategic process used to address potential crises and unexpected events. **TOURISM RISKS**: Health crisis, Natural Disasters and Political Instability **RISK MANAGEMENT INVOLVES: ( I -- A -- C )** 1. ***Identifying Risks***: recognize potential threats to organization's assets 2. ***Assessing Risks***: evaluate the likelihood (kung Kapila possible mag balik2) of threats 3. ***Controlling Risks***: Implement startegies to manage threats effectively **KEY CONCEPTS: ( F-R-A-N-S-L)** **FINANCIAL UNCERTAINTY**: possible bankrupt **RISK MANAGEMENT** is important to help company prepare and minimize the effects **ACCIDENTS:** unexpected na pang hitabo that could cause damage **NATURAL DISASTERS**: linog, bagyo or tsunami **STRATEGIC ERRORS**: mistakes in business planning **LEGAL LIABILITIES**: mga accusation or issues nga labag sa batas or maka priso sa company UNDERSTANDING THE RISKS IN HOSPITALITY AND TOURISM (H-N-P-L) **Health Crisis** **Natural Disasters** **Political Instability** **Legal and Regulatory Issues** IMPORTANCE OF RISK MANAGEMENT ============================= 1. Saves Money and Protects the Future 2. Enhances Confidence in Business Decisions 3. Strengthens Corporate Governance 4. Creates a Safe and Secure Work Environment 5. Increases Business Stability and Reduces Legal Liability 6. Provides Environmental and Asset Protection 7. Optimizes Insurance Needs RISK IN HOSPITALITY AND TOURISM SECTOR (F-A-T-O-C) 1. Food Bornes Illness (Food poison) 2. Alocohol-Fueled Behavior (palahubog) 3. Transportation Accidents (aksidente sa mga biyahe gamit service sa hotel) 4. On-premises security (mga CCTV or security guard sa hotel) 5. Cyber Security (mga hacker) **RISK MANAGEMENT STRATEGIES AND PROCESS** 1. **ESTABLISH CONTEXT** -- understand the environment in which the risk management process will occur. 2. **RISK IDENTIFICATION** -- identify and define risks 3. **RISK ANALYSIS** -- Determine the likelihood and potential consequences of risk 4. **RISK ASSESSMENT AND EVALUATION** -- Evaluate the likelihood and impact of risk to make informed decisions about their acceptability 5. **RISK MITIGATION** -- Implement strategies 6. **RISK MONITORING** -- Continuously track and review risk 7. **COMMUNICATE AND CONSULT** -- engage with internal and external stakeholders KEY QUESTIONS IN RM STRATEGIES ------------------------------ 1. What can go wrong? 2. How will it affect the organization? 3. What can be done? 4. If something happens, how will the organization pay for it? RISK MANAGEMENT APPROACHES -------------------------- 1. **RISK AVOIDANCE** 2. **RISK REDUCTION** 3. **RISK SHARING** 4. **RISK RETAINING** LIMITATIONS OF RISK MANAGEMENT ============================== 1. **DATA COLLECTION AND RELIABILITY** -- extensive data collection, can be expensive and time consuming 2. **EXPERTISE AND TIME CONSTRAINTS --** require specialized knowledge and experts 3. **FALSE SENSE OF STABILITY --** focus on historical data may prove misleading sense of stability 4. **ILLUSION OF CONTROL --** may create a false sense of control over potential risk 5. **DIFFICULTY IN SEEING THE BIG PICTURE --** may struggle to understand the cumulative impact of multiple risks 6. **IMMATURE RISK MANAGEMENT PRACTICES --** underdeveloped or immature risk management practices A. **ISO 31000: Risk Management:** can be applied across all types of organization - **Create Value** - **Integral Process** - **Address Uncertainty** - **Systematic and Structured** - **Best Available Information** - **Tailored Approach** - **Human Factors** - **Transparency** - **Adaptability** - **Continuous Improvement** B. **NATIONAL INSTITUTE of STANDARDS and TECHNOLOGY (NIST) Risk Management Framework:** managing risks in information systems - **Categorize Information System** - **Select Security Controls** - **Implement Controls** - **Assess Controls** - **Authorize System** - **Monitor Controls** C. **COMMITTEE of SPONSORING ORGANIZATIONS (COSO) Enterprise Risk Management (ERM) Framework:** comprehensive approach to risk management across an organization - **Governance and culture** - **Strategy and Objective-Setting** - **Risk Assessment** - **Risk Response** - **Control Activities** - **Information and Communication** - **Monitoring and Review** - **STRUCTURED APPROACH** 1. **Risk Evaluation** 2. **Risk Management** 3. **Implementation of Management Decision** 4. **Monitoring and Review** - **PROTECTION OF HUMAN HEALTH** - Primary concern in risk management decisions - **TRANSPARENCY** - Documenting all aspects of the process - Making the rationale behind decisions clear to all stakeholders - **RISK ASSESSMENT POLICY** - Outline the guidelines for making value judgements and policy choices during risk management process - **SEPARATION OF RISK MANAGEMENT AND RISK ASSESSMENT:** to avoid conflicts of interest and ensures objective risk evaluations - **CONSIDERATION OF UNCERTAINTY:** to guide decision-making - **INTERACTIVE COMMUNICATION**: - Clear communication with consumers and other parties - Ensures all relevant information and opinions are considered - **CONTINUING PROCESS** - Ongoing process that incorporates new data and information **MAIN GOALS OF RISK COMMUNICATION** 1. Promote Awareness and Understanding Risks 2. Promote Consistency and Clarity about the Risk 3. Provide Understanding of Risk Management Decisions 4. Strengthen Good Working Relationships and Promote Respect 5. Promote Appropriate Involvement of All Stakeholder Group 6. Exchange Information, Knowledge, Attitudes, Practices, and Perceptions STRATEGIES FOR EFFECTIVE RISK COMMUNICATION 1. Develop a communication Plan 2. Ensure Clear and Consistent Messaging 3. Engage Stakeholders Actively 4. Monitor and Evaluate Communication Efforts 5. Prepare for Emergencies 6. Maintain Communication during Non-Crisis Periods PRINCIPLES OF FOOD SAFETY AND SANITATION ### ["Sanitas": Latin word meaning "health"] ***SANITATION IN THE FOOD INDUSTRY* refers to "*the creation and maintenance of hygienic and healthful conditions"*** WHY IS SANITATION IMPORTANT? ============================ 1. LEGAL REQUIREMENT 2. PREVENTION OF FOOD POISONING OUTBREAKS 3. MAINTENANCE OF FOOD QUALITY 4. PROTECTION OF YOUR BRAND SANITATION: A FOUNDATION FOR FOOD SAFETY ASSURANCE - **Biological Hazards:** bacteria & parasites - **Chemical Hazards:** chemical/ toxins - **Physical Hazards:** foreign objects **RESULTS TO:** - Contaminated Raw materials - Errors in transportation, processing, preparation, handling or storage - Packaging problems - Food tampering/ malicious contamination - Mishandling - Changes in formulation or processing - Inadequate Maintenance of Equipment or facilities - Addition of incorrect Ingredients 5 KEY PRINCIPLES OF FOOD HYGIENE ================================ 1. Prevent Contamination from people, pets and pests 2. Separate raw and cooked foods 3. Cook Foods thoroughly 4. Store foods at the correct temperature 5. Use safe water and ingredients FOOD HYGIENE COMPRISES 2 COMPONENTS =================================== - **FOOD SUITABILITY:** intrinsic characteristic of the food such as taste, smell, texture, and presentation. - **FOOD SAFETY:** practice of handling, preparing, and storing food in ways that prevent foodborne illness and contamination. **KEY ASPECTS OF FOOD SAFETY** 1. **PREVENTION OF CONTAMINATION** 2. **PROPER HANDLING** 3. **CORRECT COOKING** 4. **SAFE STORAGE** 5. **QUALITY MAINTENANCE** 6. **EDUCATION AND TRAINING** **FOOD SAFETY: A Global Problem** **[The World Health Organization (WHO)]** INTERNATIONAL LAWS ================== - Production and sale of unsafe, injurious, or substandard food - Contamination control - Sanitation of premises, equipment, and personnel - Food safety practices, such as temperature control and treatment - Control of foodborne diseases and food poisoning - Food composition and labeling **KEY INTERNATIONAL AGENCIES AND STANDARDS** 1. **CODEX ALIMENTARIUS COMMISSION (CAC) --** established by FAO and WHO 2. **WORLD HEALTH ORGANIZATION (WHO) --** global leadership on food safety 3. **FOOD AND AGRICULTURAL ORGANIZATION (FAO)-** works with government to improve food safety **LAWS RELATING TO HEALTH AND SAFETY** 1. **Occupational Safety and Health Act (OSHA) --** established in 1971 2. **ISO 22000 -** International standard that specifies the requirement for a food safety management system 3. **Employee's Right-to-Know Act -** ensuring that employees are aware of and protected from potential hazards 4. **Presidential Decree 856:** **Sanitation code of the Philippines --** issued by Pres. Ferdinand Marcos, requirements: a. **Sanitary Permits** b. **Health Certificates** c. **Structural Requirements** **REGULATORY AGENCY** The *BUREAU OF FOOD AND DRUGS (BFAD)* is a key regulatory agency under DOH 1. Food Products 2. Drugs 3. Vaccines and Biologicals 4. In Vitro Diagnostic Reagents 5. Medical Devices 6. Cosmetics 7. Household Hazardous Substances LEGISLATIVE BACKGROUND ====================== 1. **Republic Act 3720** - Established BFAD, ensuring the safety and quality of food , drugs, and cosmetics 2. **Republic Act 7394 (Consumer Act of the Philippines)** - Protect consumers from unsafe product and to prevent false, deceptive, and misleading information **MAJOR RESPONSIBILITIES AND STRATEGIES** 1. Licensing and Inspection of Food Establishments 2. Product Registration 3. Monitoring of Trade Outlets 4. Monitoring of Product Advertisements and Processes **THE PHILIPPINE FOOD PROCESSING INDUSTRY** A crucial sector of the Philippine economy, involving the processing, manufacturing, and distribution of various food products. MAJOR PROCESSED FOOD SECTORS ============================ The BFAD plays a central role in regulating and ensuring the safety of these diverse sectors within the food processing industry