Risk & Crisis Management in Tourism Sector:

Recovery from Crisis

in the OIC Member Countries

EXECUTIVE SUMMARY

Tourism Risk and Crisis Management Frameworks

Crises are periods of intense uncertainty characterized by unpredictability and loss of control

over key functions of systems (Moreira, 2007). Generally, a crisis affecting tourismmanifests as

an event or set of circumstances which compromise or damage the market potential and

reputation of a tourism business or an entire region (PATA, 2011). Crisis management consists

of the “strategies, processes and measures which are planned and put into force to prevent and

cope with crisis” (UNWTO, 2011). Risk and crisis management is an integral component of

overall tourism and hospitality management, practised at destination level by public sector

agencies and communities, larger enterprises at destination level and by individual businesses.

Effective risk management can prevent an issue from becoming a crisis. Poor understanding and

management of risks can lead to a crisis situation. Risk management involves assessing the

probability of negative events that may lead to the tourism sector being unable to operate

normally. Six functions of risk management are identified by PATA (2011):

Identify

: Identify risks or hazards before they become realities.

Analyse

: Evaluate the probabilities, time-frames and potential impacts of each risk and

then classify and prioritise them.

Plan

: Formulate contingency action plans for mitigating the potential impact of each

risk.

Track

: Monitor the likely effectiveness of these plans by reviewing evolving risks.

Control

: Revise the plans according to data from the monitoring stage.

Communicate

: Ensure stakeholder buy-in and support in monitoring changes in the

risk environment.

Tourism managers and policy-makers need to understand the nature of crises and their likely

development and possible magnitude. Faulkner (2001) proposed a six-phase framework for

understanding the stages of a crisis and the responses necessary from stakeholders (Figure

E.1).

This framework is often referred to as ‘Faulkner’s Tourism Disaster Management Framework’, but in this

report we use ‘crisis’ to cover both natural disasters and human-induced crises.