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Hotel Crisis Management Needs Moving to the Next Level

Alexandros Paraskevas - Oxford Brookes UniversityThe Tohoku disaster shows how important is for hoteliers to move beyond the traditional crisis management approaches and plan how they will be able to continue to operate under the immediate aftermath’s adverse conditions. Oxford BrookesAlexandros Paraskevas explains the basic components of a hotel’s business continuity plan.

The ongoing tragedy in Japan shows that the crisis we are facing today and increasingly tomorrow are far from being linear; they are becoming more complex, interconnected and transboundary. In this situation we have a unique in magnitude earthquake that hit Japan’s infrastructure, followed by a devastating tsunami flooding its coastline and threatening countries ranging from the Philippines, Taiwan and Korea to Hawaii, the North and South American coasts. But the disaster did not stop there: the meltdown at the Fukushima Daiichi nuclear power plant near the town of Okuma is complicating even further an already complex disaster by adding a series of severe energy disruptions in the best case and the threat of a nuclear disaster far worse than the one we faced in Chernobyl in 1986.

Crisis situations like this underline the need for carefully designed crisis management plans that go beyond the standard evacuation processes that are normally practised and tested by hotels. Having wardens and assembly points in a safe distance somewhere in the perimeter of the property and persons assigned to have lists with guest and employee names is not enough any more.

In the case of an evacuation for example, apart from the logistics of the evacuation per se, hoteliers need to also consider the “what then?” question. Where do we take the evacuees? Is there a plan for alternative accommodation sites or we leave them in their fate? What happens to their luggage and personal effects left behind? Do we have a process in place for moving these to their new accommodation sites? How do we keep our employees help us in managing the process? What about their families?

The Tohoku earthquake of last week left most hotels with minor or no damages at all but nevertheless affected in a number of ways. Some can not be evacuated because of the floods; others have to accommodate stranded guests and evacuees from other areas; all of them will have to deal with continuous energy disruptions and water shortages in addition to protecting their facility from a potential radioactive fallout. Regardless of the level of disruption to their operations from this disaster, these hotels and business units must resume their functions and address their customers’ needs in a properly organised manner. The better they are prepared for these challenges the faster they will bounce back to ‘business as usual’ and this will give them a valuable competitive advantage.

Therefore crisis management planning has to go beyond dealing with the disaster itself and move to the level of ‘business continuity’ which is concerned with how we are going to continue our basic operations under disaster conditions. There are three basic components that need to be considered:  people, facilities and processes.

The people component will be looking at staff and guest welfare in case of a major disruption, especially when they move to alternate locations or if there are victims. In the pre-disruption period, the planning should be looking at the chain-of-command in the hotel, including the notification process and the call trees. Necessary for this task will be an up-to-date contact information database. In the aftermath of a disruption, depending on its severity, the planning should be looking at the creation of an information/support system for guests’ and staff’s families, the co-ordination of victim counselling, and to ensure that appropriate duty of care is in place.

The facilities component, apart from the checks on structural integrity, security and full compliance with safety standards (both company and regulatory) should include plans for alternate easily accessible accommodation for guests during the period of disruption. Periodic tests should also be planned and records kept of evacuation procedures and safety and security measures in place on site.

The process component will be concerned with the availability, resumption, continuity and recovery of all those processes and services deemed necessary for the operation of the hotel (check-in, check-out, guest accounts, housekeeping, food and beverage) as well as the resources necessary for them (staffing levels, alternative energy sources, lighting, heating, water supply and pressure, etc).

In a disaster like in Japan, therefore the primary concern would be employee and guest safety. All guests and employees should be accounted for and emergency ‘skeleton staff’ should be assigned with specific duties in shifts, so that they can check their own families as well as get some rest. In the broader area of the affected region (Miyagi, Iwate and Fukushima) temporary shelters should be made available to hotel guests, if hotels suffered structural damage, and guests provided with basic necessities such as food, water and blankets. Due to power disruption there is a high risk for the hotels’ food supplies to deteriorate soon therefore it is suggested that they are all cooked in the shelter and distributed to guests and to the local community as a gesture of solidarity.

Expected aftershocks of 7.7R suggest that shelters should be located in higher ground since another tsunami is possible. In co-ordination with local authorities, given that the Sendai airport remains closed and the Shinkansen (high speed rail) out of operation, possible evacuation routes towards Nigatta and Tokyo or other major cities should be explored. Conventional rail lines are expected to be in operation relatively soon and these may provide a window of opportunity – as long as it lasts. Same routes would serve to bring in food, water and other supplies (e.g., propane gas bottles) necessary for the resumption of basic hotel processes and services. These can be sourced by unaffected suppliers or by sister hotels (if any) outside the affected region.

Properties outside the impacted region will maintain their operation but will have to be able to withstand aftershocks (therefore structural inspections are strongly recommended) and an overflow of evacuees as well as existing guests who cannot leave the country. Provision must be made for major disruption in utility services and the management needs to ‘train’ both guests and staff in safety procedures not only for the expected aftershocks but also for the case of a nuclear emergency. Since, apart from the Fukushima power plant, five more plants are reported to be under ‘severe stress’ the possibility of more meltdowns is high. Hotel management and staff need to be prepared for such a possibility and take the necessary protective measures if and when needed. In the absence of a specific CBRN (Chemical, Biological, Radiological, Nuclear) policy, the hotel may follow the processes planned for a pandemic or seek advice from the local authorities.

By planning these three components (people, facilities and processes) for the immediate aftermath of a disaster, hoteliers will have made an important step to the next level of crisis management and build up their property’s resilience to disasters, regardless of their severity and complexity.

Dr Alexandros Paraskevas is a Senior Lecturer in Strategic Risk Management in the Department of Hotel, Leisure and Tourism Management of the Business School at Oxford Brookes University, Oxford, UK. He is currently working with a leading hotel group on the enhancement and alignment of business continuity and disaster recovery planning for its operating system’s 30 sites (global and regional headquarters, central reservations offices, data centres and business service centres).