Crisis management: towards a model for the hotel industry : an examination of crisis preparedness and stakeholder relationships in crisis situations.

Abstract

Crises are inevitable. There is no way to prevent all crises from happening. In fact, in today's business environment crises are an integral part of organizational life. Crisis situations are by nature novel, unstructured, frameworks. Crises are sudden, acute, and demand a timely response. Most man-made crises are in principle preventable. Crisis management is a new field of research that addresses the problems of dealing with crises, and the stress that accompanies crises. Crisis management involves efforts to prevent crises from occurring; to prepare for a better protection against the impact of a crisis agent; to make for an effective response to an actual crisis; and to provide plans and resources for recovery and rehabilitation in the aftermath of a crisis. It is no longer enough to consider "if" a crisis will happen but rather "when" a crisis will occur, "which type", and "how". There is no doubt that the travel and tourism industry is especially susceptible and vulnerable to crises. It is argued that the hotel industry, given its operational characteristics, management practices (which is strongly influenced by long established traditions), and its operating environment, is even more prone to crises. However, very little has been done to understand crisis (that is, how a crisis evolves, crisis typology, anatomy, and management of crisis). This study describes and discusses all major relevant elements and issues to the emerging field of crisis management. Within the domain of crisis management theory, the study describes and elaborates on critical issues such as crisis typology, anatomy of crisis, crisis planning and training, crisis decision making, crisis communication, and crisis management. It is argued in this study that organizational culture is the most fundamental element in crisis preparedness. That is, organizational culture, not organization structure, size, financial history, etc., is the main determinant of crisis preparedness. The research also argue that stakeholders are fundamental in crisis prevention, crisis management and crisis recovery. 2 This study, in a first instance, examines the crisis preparedness of 33 of the 50 top hotel organizations operating in the UK (HCIMA, 1995). Crisis preparedness is examined in the light of organizational culture. For that, top executives in those organizations were interviewed and responded to two questionnaires. A crisis preparedness framework (or continuum) was derived from the application of factor analysis on the questionnaire data. The results suggest that the hotel industry is not prepared for crises. Given that a crisis is a multi-stakeholder phenomenon (it inevitably involves other agents) this study also explores, building upon the results obtained from the crisis preparedness continuum, the notion of stakeholders relationships in crisis situations. More specifically, the research proposition states that organizations that are crisis "prepared" are more consistent on their opinions about stakeholders' role and behaviour in crisis situations than those organizations that are not prepared for crises. The study confirmed both the research question and proposition. The study also presents an operational definition of crisis management and proposes a model for crisis management