Facility and Risk Management for Hospitality Operation

This report aims at giving a detailed analysis of how evaluation and mitigation of risks can be achieved in Doltone House. It covers the concept of risk, risk management process, risk identification, evaluation, and mitigation. It also provides recommendations for addressing the identified risks.

Running Head: FACILITY AND RISK MANAGEMENT FOR HOSPITALITY OPERATION
1
Facility and Risk Management for Hospitality Operation
Name
Institution
Date

FACILITY AND RISK MANAGEMENT FOR HOSPITALITY OPERATION
2
Facility and Risk Management for Hospitality Operation
Executive Summary
The contemporary world is becoming disturbing, worrying and troubling. For over 60
years, the theory that the number of possible business URls and catastrophes will be infinite has
proven true. These catastrophes are omnipresent. They are also proliferating. For instance, in
2018, the number of conflicts, failure and disasters was alarming. These cases are becoming
more hazardous and widespread than before. Such is an indication that the risks are rapidly
changing are growing. Just like any other business operation, Doltone House needs to identify its
potential risks and mitigate them. This report aims at giving a detailed analysis of how such
evaluation and mitigation can be achieved. Once Doltone House management is aware of the
risks, it will be easier to prepare for the uncertainties. Entities such as governments, non-profit
organizations and businesses have been facing lot of risks. According to Braunscheidel, a risk is
the uncertainty that regards a loss. Losses that occur from incidents such as negligence, accident
or auto damage can be classified as risks. This is because they can give rise to a liability. Losses
in this case may include disappearance or lessening of value.

FACILITY AND RISK MANAGEMENT FOR HOSPITALITY OPERATION
3
Table of Contents
Executive Summary.........................................................................................................................2
The concept of risk .........................................................................................................................4
Risk management process................................................................................................5
Risk identification............................................................................................................6
Risk evaluation................................................................................................................7
Risk mitigation.................................................................................................................7
Recommendations………………………………………………………………………………10
Summary and Conclusion .............................................................................................................10
References .....................................................................................................................................11
Appendix A: General summary of the Risks.................................................................................14
Appendix B: Venue Risk Analysis (VRA) form...........................................................................15

FACILITY AND RISK MANAGEMENT FOR HOSPITALITY OPERATION
4
The Concept of Risk
Risks are divided in to two major classes. These are spectacular and pure risks (Bommer,
2015, p.625). Spectacular risks involve a chance of either a gain or a loss. On the other hand,
pure risks involve a chance for the risk. Some aspects have been identified to be subject to risks.
Mutual fund investment is one of these aspects (Yoon et.al. 2018, p.3638). Many cases have
been reported where people have offered documents before reading their terms and conditions.
The end result has been incurring losses that could have not avoided if the terms and conditions
were well read and analyzed (Bromiley et.al. 2015, p.266). It is therefore important to understand
the terms and conditions in every mutual fund investment (Chen et.al. 2017, p.857). Terms and
conditions are in most cases used to communicate the risks and uncertainties that may take place
in the mutual schemes. Market risks that can occur in mutual fund investment include changes in
interest rates, commodity related risks, foreign exchange rates and equity investment risks. These
risks are obvious regardless of the type of the market.
Such risks can be social and governance or environmental. The risks can impact their
survival, success and profitability. Many organizations have however been formed to help
businesses and other organizations mitigate these risks. Examples of such organizations include
WBCSD and COSO (Ge et.al, 2016, p.230). They have really helped in controlling the
dependencies and unique impacts that are caused by operation risks. They have also helped many
companies to understand and disclose their risks effectively. Enterprise risk management
concepts can also mitigate risks (Khan, 2016. p.77). Organizations have become more linked and
interconnected. This is because of globalization that has taken over the world in 21st century.
Such connectedness has increased the chances of unexpected risks in many organizations.

FACILITY AND RISK MANAGEMENT FOR HOSPITALITY OPERATION
5
Organizations have become exposed to risks than before (Ho, 2015, p.5037). A simple crisis can
thus turn to a catastrophe. A single risk can be spread to many business organizations. This is
because; when a single risk affects a shared resource all the organizations. It is very complex and
challenging for organizations to use URls (Hammer, 2015.p.16). They are the toughest risks to
an organization. Enormous failures have been reported to occur in many organizations. These
cases have also been reported in organizations with high reliable reputation. Such failures
demonstrate the need for better risk management strategies because the current ones have failed
in delivering sufficient responses to the risks.
Risk management process
Risk management process is done in a number of stages. The first stage is risk
identification. This stage identifies operations that can go wrong in a business. It is a discipline
process that marks the check lists for potential risks. It is still in this process where an evaluation
of the risks is done. Experiences from past events are sources of such checklists. This stage also
helps in identifying specific risks as well as expanding the thinking of business managers. Other
sources of identifying potential risks are business experts, past experiences and the business
teams.
The second stage of risk management process is evaluation (Conforti et.al. 2017, p.69).
After the potential risks have been identified, they are then evaluated based on their probability
of occurrence. Risks can have different impacts on the business. This is why the evaluation stage
is critical in this process. Some have higher probabilities of occurrence than others. Their
impacts on the business are different. Every business should therefore design its own criteria that
can be used to determine high impact risks. The criteria will narrow the focus of critical risks.

FACILITY AND RISK MANAGEMENT FOR HOSPITALITY OPERATION
6
The final stage in risk management process is risk mitigation. After the probability of
occurrence has been evaluated for every risk, the development team then prepares a mitigation
plan. The plan is intended to reduce the impact of the risks. There are several techniques that
help the development team in mitigating the risks. These techniques include risk avoidance,
sharing, reduction and transfer (Bürer, 2019, p.106002). Each of them is very critical at this
stage. Risk avoidance involves finding an alternative strategy. The alternative strategy should
however have high chances of success than the current strategy in use (Brown et.al. 2016, p.344).
However, these strategies are usually associated with higher costs. A common risk avoidance
technique that has been used by many businesses is use of technology.
Risk sharing technique involves a business partnering with other parties to share the cost
of the risk (Cheomar, 2019, p.622-626). Legal, labor and political risks can be mitigated by use
of this technique. The main advantage of risk sharing technique is that the cost of loss is shared
among the partners. The following is a series of steps for the risk assessment process. The risk
assessment will be headed by the manager of Doltone House. Once the major risks have been
identified, they can then be categorized according to their impacts on the business. Individual
contributions as well as the roles of every employee must also be defined (Braunscheidel, 2009,
pp.119). The level of evaluation and the employees support required should be balanced for
certainty. The evaluation model will use the risk’s likelihood of harm. The model will therefore
require both quantitative and subjective evaluations. The levels of likelihood in this case will be
high, low and medium.
Risk identification
 To identify the risks the manager will:

FACILITY AND RISK MANAGEMENT FOR HOSPITALITY OPERATION
7
 Look at guidance from the website and other sources. Past experiences can be a
reliable source of ideas.
 Walk around the building and other places within the restaurant to identify anything
that might be a risk. He should do this while taking into account the consideration
form the researched ideas he already has.
 Talk to the staff and the customers to learn about their past know knowledge and
experiences.
 Consult the incident book to identify what were the impacts of the previous incidents.
 The employees as well as the customers will write down who they think could be
harmed while at work and how.
Risk evaluation
 The manager will then note the controls that will help in reducing the occurrence of the
risks or
 The likelihood that someone is hurt while in the restaurant. He will also compare these
controls with the ones he learned from the website and past experience (as from step one)
and compare the controls.
 The manager will then record his findings in the incident book. He will also need to
discuss them with his staff since they will also play important roles in mitigating the
risks.
 The manager will then analyze the financial risks. The risks will be based on cash flows,
market rates, credit and regulations.
Risk mitigation
 The manager will devise methods for mitigating any potential risk.

FACILITY AND RISK MANAGEMENT FOR HOSPITALITY OPERATION
8
 The manager will have to periodically review the risks identified.
It has been proven that mitigating risk of complex systems is complicated. This is still the
case with connected organizations. There is therefore a need for organizational resilience.
Organizational resilience is achieved if an organization is able to identify, evaluate and mitigate
its risks. In order to mitigate risks, a risks management process must be developed (Li, 2015.
p.04015037). Risk management process initial stages include identifying and monitoring the risk.
The final stage is managing the risk to minimize its impacts on the business. Risk management is
crucial to every business. All businesses, whether private or public, must therefore implement
this process (Warren et.al. 2018, p.20170295). In fact, some causes of risks such as natural
disasters and theft are almost inevitable.
Another reason is that risk may cause losses or injuries. The injuries may have a huge
impact to the business since they may affect the owner, customers, visitors or even the premises.
The business owner can then be forced to spend money for compensation. The owner can also be
forced to close the business if he cannot afford funds to reinstate the business. This is mostly the
case when a business is not insured. All levels of an organization must be committed to ensure
that the risk management process is successful. The procedures defined in the process should
also be precise and clear to enhance its implementation. The roles and responsibilities for every
stakeholder in the process should be well defined.
Finally, ongoing training on testing and monitoring of the risk management process must
be done. One of the main advantages of risk management process is that a business manager is
usually prepared for the unexpected. When a business is prepared for such uncertainties, risks
and extra costs are minimized. Preparing for the future entails considering potential risks. Such

FACILITY AND RISK MANAGEMENT FOR HOSPITALITY OPERATION
9
preparation also entails analyzing any effects that may result to extra cost for the business
operation. Saving money to protect the business can also be an example of such preparations.
Another advantage of a risk management process is saving on valuable resources such as
income, assets and money. A risk management process also helps in reducing legal liability.
When a business reduces its legal liabilities, its stability will obviously increase. The final
advantage of a risk management process is that it protects people and assets from harm.
Risk reduction involves investing on funds to reduce the likelihood of the risks. An
example in this case will be purchasing the guarantee of a currency rate in a bid to mitigate risks
such as fluctuations. The final technique is risk transfer. This technique shifts the risk from the
business to another party. An example of a risk transfer technique that has been adopted by many
businesses is insurance.
Risk management in this case will involve strategies and processes that will aid in
mitigating risks that Doltone House may face. The process will help in identifying and
monitoring the potential causes of risks. It will also help to manage any potential risks such as
data loss, human harm, theft breaches, natural disaster such as floods and system failure in the
restaurant. The first case will involve risk assessment for the business using risk ranking system
and analysis by use of a venue analysis form. The risk management process for Doltone House
will have four stages. These stages are assessment and analysis, risk evaluation, treatment and
response and mitigation. Thinkstep will be used as the risk assessment model in this case. The
model works by assessing the likelihood of a risk to occur. It also identifies the seriousness the
risk to either the business or the employees. The model is based on two questions which are as
follows:
 How likely is that the risk will harm me or somebody else?

FACILITY AND RISK MANAGEMENT FOR HOSPITALITY OPERATION
10
 How bad could the risk harm me or somebody else?
These two questions will be critical in identifying the type of risks which are more
serious than others. The model will address the severity and probability of the risks presented by
the manager in each case.
Recommendations
Analyzing how the business will mitigate the identified risks will be the most significant
decision that the management of Doltone House can make. This section will present proposals
for addressing these risks. Basing on the results from the risk assessment section, it is evident
that there are several uncertainties that Doltone House can face. The following are the
recommendations that will help in mitigating those risks. The restaurant should ensure good
work practice. This will help in mitigating the risk of violent customers. Doltone House will also
need to ensure that it adopts high security measures such as adoption of 24-hour security guards
or installations of Cctvs. Doltone House should also ensure that the business is insured.
Insurance will reinstate the restaurant in case of losses resulting from activities such as fire and
other natural calamities. Lastly, ensuring regular inspection within the business premises will
ensure that risks such as falls and traps are mitigated.
Summary and Conclusion
The outlined risk assessment procedure will aid the business in identifying potential risks
that may lead to losses. The report will also help the business to figure out what it needs to
present to ensure that is it prepared for uncertainties. The scenario, objectives and the goals of
the business have been presented in the report. Identifying goals and objectives will help the
management team to rank the risks. Ranking will help in prioritizing the risks. This is because
the likelihood for every potential risk is presented in the report. Finally, the report will be

FACILITY AND RISK MANAGEMENT FOR HOSPITALITY OPERATION
11
important to both the management and employees of Doltone House since it will be the main
source of reference for decision making. The management should however have the ability to
identify other potential risks that were not included in the report.

FACILITY AND RISK MANAGEMENT FOR HOSPITALITY OPERATION
12
References
Bommer, J.J., Crowley, H. and Pinho, R., 2015. A risk-mitigation approach to the management
of induced seismicity. Journal of Seismology, 19(2), pp.623-646.
Braunscheidel, M.J. and Suresh, N.C., 2009. The organizational antecedents of a firm’s supply
chain agility for risk mitigation and response. Journal of operations Management, 27(2), pp.119-
140.
Bromiley, P., McShane, M., Nair, A. and Rustambekov, E., 2015. Enterprise risk management:
Review, critique, and research directions. Long range planning, 48(4), pp.265-276.
Brown, R.J. and Froelich, C.A., Bank of America Corp, 2016. Risk ranking referential links in
electronic messages. U.S. Patent 9,344,449.
Bürer, M.J., de Lapparent, M., Pallotta, V., Capezzali, M. and Carpita, M., 2019. Use cases for
Blockchain in the Energy Industry Opportunities of emerging business models and related
risks. Computers & Industrial Engineering, 137, p.106002.
Chen, H., Cui, R., He, Z. and Milbradt, K., 2017. Quantifying liquidity and default risks of
corporate bonds over the business cycle. The Review of Financial Studies, 31(3), pp.852-897.
Cheomar, A.R. and Ishak, S., 2019. A study of palm oil fruit dealers' business
risks. International Journal of Supply Chain Management, 8(1), pp.622-626.
Collen, B., Dulvy, N.K., Gaston, K.J., Gärdenfors, U., Keith, D.A., Punt, A.E., Regan, H.M.,
Böhm, M., Hedges, S., Seddon, M. and Butchart, S.H., 2016. Clarifying misconceptions of
extinction risk assessment with the IUCN Red List. Biology letters, 12(4), p.20150843.
Conforti, R., de Leoni, M., La Rosa, M., van der Aalst, W.M. and ter Hofstede, A.H., 2015. A
recommendation system for predicting risks across multiple business process instances. Decision
Support Systems, 69, pp.1-19.

FACILITY AND RISK MANAGEMENT FOR HOSPITALITY OPERATION
13
Ge, H., Nolan, J., Gray, R., Goetz, S. and Han, Y., 2016. Supply chain complexity and risk
mitigation–a hybrid optimization–simulation model. International Journal of Production
Economics, 179, pp.228-238.
Giannakis, M. and Papadopoulos, T., 2016. Supply chain sustainability: A risk management
approach. International Journal of Production Economics, 171, pp.455-470.
Hammer, M., 2015. What is business process management?. In Handbook on business process
management 1 (pp. 3-16). Springer, Berlin, Heidelberg.
Ho, W., Zheng, T., Yildiz, H. and Talluri, S., 2015. Supply chain risk management: a literature
review. International Journal of Production Research, 53(16), pp.5031-5069.
Khan, F., Hashemi, S.J., Paltrinieri, N., Amyotte, P., Cozzani, V. and Reniers, G., 2016.
Dynamic risk management: a contemporary approach to process safety management. Current
opinion in chemical engineering, 14, pp.9-17.
Li, N., Fang, D. and Sun, Y., 2015. Cognitive psychological approach for risk assessment in
construction projects. Journal of Management in Engineering, 32(2), p.04015037.
Nikitin, P.V., Zagaynova, E.N., Zagaynov, I.A., Blinova, M.L. and Safina, T.A., 2016. The
mathematical business-risks assessment model in organization administration. Journal of
Economic & Management Perspectives, 10(2), pp.252-260.
Rosemann, M. and vom Brocke, J., 2015. The six core elements of business process
management. In Handbook on business process management 1 (pp. 105-122). Springer, Berlin,
Heidelberg.
Warren, R.F., Wilby, R.L., Brown, K., Watkiss, P., Betts, R.A., Murphy, J.M. and Lowe, J.A.,
2018. Advancing national climate change risk assessment to deliver national adaptation

FACILITY AND RISK MANAGEMENT FOR HOSPITALITY OPERATION
14
plans. Philosophical Transactions of the Royal Society A: Mathematical, Physical and
Engineering Sciences, 376(2121), p.20170295.
Yoon, J., Talluri, S., Yildiz, H. and Ho, W., 2018. Models for supplier selection and risk
mitigation: a holistic approach. International Journal of Production Research, 56(10), pp.3636-
3661.
Yoon, J., Talluri, S., Yildiz, H. and Ho, W., 2018. Models for supplier selection and risk
mitigation: a holistic approach. International Journal of Production Research, 56(10), pp.3636-
3661.
Appendix A: General summary of the Risks
Severity / Probability Low Medium High

FACILITY AND RISK MANAGEMENT FOR HOSPITALITY OPERATION
15
High potential impact
on the business
Medium High High
Medium potential
impact on the
business
Medium Medium High
Low potential impact
on the business.
Low Low Medium.
Appendix B: Venue Risk Analysis (VRA) form
Risk Consequence Risk
category
likelihood Impact Risk rank Risk treatment
Broken
tile
Trip hazard Slips trips
& falls
1 3 6 Repair floor.
Replace the tiles

FACILITY AND RISK MANAGEMENT FOR HOSPITALITY OPERATION
16
regularly.
Give warnings on
broken or slippery
floor (Nikitinet et.al.
2016, p.252).
Spillage
s
Employees as well
as customers may
suffer bruises,
fractures and other
physical injuries
Slips, falls
and trips
4 4 4 Spillages should be
cleaned as quickly as
they are noticed, th8us
keeping the floor dry.
Bar people from
entering areas that
have been washed
recently.
The staff should
ensure that there is
good housekeeping in
the restaurant.
There must be proper
drainage channels in
the restaurant.
Doormats should be
kept for wet weather.
Broken
ladders. Employees may
suffer fatal injuries
Slips, falls
and trips
3 2 8 Ladders should be
stable and regularly
checked.

FACILITY AND RISK MANAGEMENT FOR HOSPITALITY OPERATION
17
if they fall from
heights.
An example of
such falls is an
employee falling
from a ladder.
.
People should be
excluded from areas
where hatch is open.
They should also be
excluded while hatch
is in use.
All work at height
should only be done
by people with permit.
Violent
custome
rs.
Employees and
other customers
may suffer physical
injuries and stress.
Violence 5 6 1 Staff should report
these cases to the
management for
further actions.
Staff should be trained
on a good behavior
and how they should
politely deal with
violent customers.
Incident book should
immediately be filled.
This will make it
easier to mitigate
mitigation the risk.
Staff should be made

FACILITY AND RISK MANAGEMENT FOR HOSPITALITY OPERATION
18
aware of violent
customers.
The manager should
develop information
sharing scheme with
security forces.
Transpo
rt
Employees may
suffer physical
injuries.
Delivery
risks
6 9 7 Ensure that there is
High-visibility
waistcoat that is
available.
Make use of delivery
vans.
Manual
Handlin
g
Staff may suffer
from back pains
and broken limbs
as a result of lifting
heavy objects.
Slips, falls
and trips
8 7 9 Staff should be trained
on rolling of
commodities sold in
the restaurant.
Introduce sack tracks
and trolleys.
Faulty
pressuri
zed
systems
Explosions from
faulty or damaged
pressurized system
may cause burns or
even deaths to
employees.
Burns 9 5 Installed by a licensed
dealer.
Only trained staff
should operate
pressurized systems.
Using the systems as

FACILITY AND RISK MANAGEMENT FOR HOSPITALITY OPERATION
19
per the instructions
given by the
manufacture.
Regular inspection of
the system.
Obtained from
reputable dealers.
Proper storage must be
maintained.
Used in safe, dry and
secure area.
Loss of
property
Loss of assets and
money.
theft 2 5 2 Security doors should
be installed.
Enough security
personnel must be
deployed.
Highly valued
equipment should be
insured.