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3201THSManaging Risk in Tourism, Events andHospitalityNAME: JIAFENG ZHENGSTUDENT NUMBER: S5105131Word count: 1837Professor: Truc Le
IntroductionNowadays, tourism has become one of the industries with the fastest economicgrowth, which not only meets the needs of the vast number of tourists, but alsobenefits the cause of poverty alleviation in various countries (Sofronov ,2018).However, it is also accompanied by inevitable risks. Most tourism management relieson knowledge of risk management to avoid the maximum losses. Risks come frommany different places in the hospitality industry, such as financial risks that pay morefixed fees and human resource management risks need to adjust the relationshipbetween employees. Risk management is a management process that minimizes theadverse effects of risks when risk is triggered. (Risk management, 2018) With thedevelopment of business, risk management is increasingly important in the dailyoperations of enterprises, so as to make decisions easily and prevent potential risksfrom causing losses to the company's profits. Therefore, managers pay attention torisk management in order to increase the profits of company. The main purpose of thisessay is to analysis and discuss the role and importance of risk management in termsof legal, ethical and sustainability dimensions. The major focus of this article is toexplore the implications of the existing problems in three dimensions of hospitality,tourism and events. This paper is divided into five parts that introduction, legaldimension of risk management, ethical dimension of risk management, sustainabilitydimension of risk management and conclusion. Three practical cases will illustratethe legal, ethical, and sustainability dimensions of risk management.Legal dimension of risk managementOver the last few decades, the law of the hospitality and tourism industry has becomeone of the most noteworthy issues (Oramah, 2012). Especially the crime that fraud iscommon in the travel and hospitality industry, including insurance fraud and paymentin the form of stolen credit cards (Drummond, 2007). For hospitality, industry
statistics show that organizations lose 5 to 6 percent of their annual revenue due tostaff and visitor fraud (Baker, 1949). For example, a hotel operator with annualrevenue of about $10 million may experience a loss of between $500,000 and$600,000. It is vulnerable to various forms of hacking and electronic theft, which canseriously affect their reputation and loyal customers. Legal risk management has theright risk concept, performs systematic management activities and penetrates into allaspects of the organization and processes. For the hotel industry, the establishment ofavailable risk management can help consumers and managers to reduce losses,maintain the trust between the two sides of the relationship and interests.