The emerging importance of risk management and enterprise risk management strategies in the Indian hospitality industry

Abstract

Purpose The purpose of this paper is to discuss the outlook for risk management and enterprise risk management (ERM) within the hospitality sector including how ERM is being balanced with the need to innovate, and what boards of directors are doing to become more engaged in risk oversight. The implementation of ERM is about taking a strategic view of risk and linking it to business goals and value creation. Design/methodology/approach An interviewer-administered survey was used to collect data from 33 senior risk professionals and other industry experts who had a clear understanding of both risk management and ERM. A structured and semi-structured questionnaire consisting of three sections was personally administered to 33 respondents in 2018 to collect information from risk professionals and other industry experts. Findings It is important to create a culture of risk awareness and to incorporate risk planning into business decisions. The complexity of modern business necessitates that managers in the hospitality sector have greater skill levels than ever before. This research should help hospitality managers to better understand the core risks and link them to strategy. ERM creates an environment where the organization as a whole can support the value creation process with a sharper focus on risk management. Practical implications The growing role of technology along with human connections is shaping the hospitality sector and redefining the travel ecosystem. Future travel experiences are likely to be influenced by a blend of technology and human experiences. Many Indian companies are applying the traditional risk management model in their businesses, while ERM is their future goal. The evolution from a traditional risk management model to ERM is challenging, and so it is important to have an appropriate framework in place for its implementation. Originality/value Hospitality managers need to know how to proactively manage risk management and ERM as the sector is increasingly vulnerable to internal risks. ERM creates a direct linkage between risks and opportunities required for decision-making in a dynamic environment. With growing competition on a global level, the hospitality industry should aim to manage risks strategically to increase the likelihood that organizational objectives can be achieved.

The Effect of Enterprise Risk Management, Knowledge Management, and Organizational Culture on Organizational Resilience

“…Thus, the company can change the configuration of its assets so that they can be adjusted to changes in the environment (Mishra et al, 2019). Another study is research conducted by Vij (2019). Vij (2019) tries to examine the impact of implementing ERM on the innovation ability of companies in the Indian hospitality sector.…”

“…Another study is research conducted by Vij (2019). Vij (2019) tries to examine the impact of implementing ERM on the innovation ability of companies in the Indian hospitality sector. From the results of his survey, Vij (2019) concluded that the application of ERM in the hospitality sector can connect risk with organizational goals so that it can balance innovation and risk.…”

“…Vij (2019) tries to examine the impact of implementing ERM on the innovation ability of companies in the Indian hospitality sector. From the results of his survey, Vij (2019) concluded that the application of ERM in the hospitality sector can connect risk with organizational goals so that it can balance innovation and risk. Furthermore, research conducted by Bogodistov and Wohlgemuth (2017) examines how ERM is applied to the resilience risk of an organization.…”

The tourism and hospitality industry in India: emerging issues for the next decade

“…Given this reality, it is important to understand the different kinds of risk and the perceptions and likely responses of senior management as well as the action that can be taken to mitigate the underlying issues. These considerations are very relevant to industry and they are addressed by Vij (2019) in her paper that examines the perspectives of senior risk professionals in relation to risk management and enterprise risk management in the Indian hospitality sector.…”

What should Indian tourism and hospitality managers focus on to stay competitive in the coming decade?

“…The emerging importance of risk management and enterprise risk management strategies Given that the tourism and hospitality industry is dynamic in nature, any disruptive innovation is likely to cause vulnerability to changes occurring in both internal and external environments. Vij (2019) conducted a study to determine senior management perspectives on risk management and enterprise risk management (ERM) in the hospitality sector. ERM is essentially concerned with a strategic view of risk and relating it to business goals and value creation for the organization.…”