Terrorism and political tensions have a massive impact on the hotel and travel industry. Terrorists focus on causing insurgency to cause devastating effects by destroying human lives. They mostly target tourist and hospitality locations to get global attention. Tensions and political instabilities are unfavourable to the economy. Travellers are stranded, and uncertain conditions turn tourists away from hazardous locations (Garg, 2010). Marriott International Inc. is among the multinational corporations that have experienced the malicious acts of global terrorists. Marriot is a multinational company leading in the hospitality provision business; a hotelier and travel agency that create extraordinary moments and experiences among its customers. The advent terrorist activities such as Brussels terrorist attacks, the Islamabad Marriott Hotel bombing, the Parris attacks, as well as the Jakarta bombings affected the Marriot International. The company, therefore, should join forces with global and local organisations in fighting terrorism. Several measures can be put in place to practically counter terrorist threats in the industry. Respect for human rights is the basis of fighting terrorism.
ABOUT THE RISK
The United Nations defined terrorism as operations calculated and intended to cause terror and fear to the general public. Terrorists may also target particular individuals or a group of people for various reasons. Terrorism offences seek to intimidate the general public, compel governments, and destroy economic, social, as well as the constitutional structures of organisations. Besides, terrorism are acts that are undertaken to take in hostages, cause serious bodily injuries, and causing deaths. The US Patriot Act of 2001 term terrorist perpetrations as those crimes committed with the use of dangerous weapons endangering substantial property and public safety. These activities include hijacking vehicles, buses, boats, and aeroplanes.
The business environment suffers from acts of terrorism. Instabilities influence trade flows, investment, and economic growth. The cost of trading in other countries become high when safety is not guaranteed. Conducting business in terror-prone-states is risky, and the vulnerability to the economic issues continue to crop in. The uncertainties in the market kill future dreams of investment and economic growth and development. The terror affected areas become vulnerable to inconsistent businesses. Companies should participate in projects created to reduce acts of terrorism.
Religious and political phenomena motivate modern-day terrorism. Scholars claim that this era is characterised by religion-based terrorism. Europe and the US identify with Islamic extremism as well as the Buddhist, Sikh, Jewish, and Christian extremists as the perpetrators of religious terrorism. The religious extremists believe that they are fighting against evil concerning the laws laid down by their supreme deities. Terrorism occurs within geographical and political settings intending to build new leadership systems. Generally, terrorists have a developed framework that justifies their violent acts on social groups and institutions. These extremists claim to voice the grievances of the minority groups. The complaints being those that have been ignored by political, peaceful, and conventional avenues (Radil & Flint, 2013). Therefore, terrorists pursue a political goal even when fighting in religious terms. These groups believe that only violence can replace a political order.
Terrorism has a negative influence on the political, cultural, social, and economic aspects of life. The immediate impact of terrorism is the loss of lives. Acts of terrorism bring violence to the society, disrupting peace and stability in the environment. Civilians and defence personnel have died due to terrorism. The casualties across the world have succumbed to air attacks, missile shelling, landmine cultivation, assassination, land shelling, and suicide bombing. These heinous acts sabotage humanitarian efforts. These conditions worsen the rule of law and reduce the presence of the government. The acts of terrorism hinder the human rights execution and prevent individuals from enjoying their freedoms. Terrorism includes hostile acts like harassment, detention, abduction, beating, injuries, and murder. Actions of terrorism hinder the human rights provisions. These actions welcome anarchism and weaken the rule of law.
Furthermore, terrorism threatens education. Schools and institutions of learning cease to function freely when there is tension. The number of schoolgoers reduces leading to a failed education system. Acts of terrorism threaten investors because of adverse business conditions. Governments cannot collect taxes from unsafe areas. Terrorism accounts for weak economies. Political instabilities and tensions expand a country’s financial budget to cater to human resources and improving the damaged infrastructures.
Additionally, instabilities render the national services hard to reach the citizens. The consequence of terrorism is poverty. Both developing and developed countries face the obstacle of having to deal with the cost of security, construction and installation of security equipment.
UN Global Impact unit enhance the collective approach to countering terrorism. The UN framework has made substantial progress in securing borders and troubled nations. Companies seeking to join hands with governments to fight terrorism should step forward to help in the journey actively. Communities and victims of terrorism are encouraged to be part of this war on terrorism. As mentioned earlier, for an organisation to declare war on terrorism, they must uphold human rights. Companies and institutions should protect the rule of law and international regulations.
RELEVANCE OF THE RISK TO INDUSTRY AND COMPANY
Tourism and terrorism connect through their similar characteristics such as utilisation of communications and travel technologies, involve citizens from various nations, and include the crossing of international borders. Terrorism and tourism first connected in 1972 after the Munich Olympic Games attacks. Since these events, terrorism has always been linked to international tourism. In the mid-80s, there was evidence of the adverse effects of terrorism on the tourism sector after the Irish Republican Army (IRA) bombing campaign in London. International tourists live in the reality of terrorist threats in today’s world. Tourists are a target to terrorists because they are identifiable and soft symbols of their enemy. Besides, tourist destinations are convenient locations to undertake acts of tourism strategically. The modern day age is characterised with so much information with the inability to evaluate the context of what they happen. This feature increases the potential for terrorism dangers.
The hospitalist and travel industry contribute immensely to the economic development and growth of a state. Terrorist attacks can seriously deter the sector. Destructions and confusions destroy the growth of international tourism after terrorist attacks. Tourists are instilled with fear and will start second-guessing whether they should go for adventures or not. Tourist destinations influence the cancellation of tickets and high-end flights. According to the World Economic Forum (2015), the 2011 US attacks resulted in a loss of 35% in demand. Several airports and hotels were not operating after the attacks.
The costs of damages and losses are enormous in the tourism sector after terrorist attacks. Apart from cancellations of tickets and booking, there is the destruction of assets. These effects indirectly cause unemployment and disrupt the economic form of the country. Nations and governments end up employing all their resources in fighting terrorism. Eventually, the industry starts facing less consumption and financial setbacks. The indirect costs resulting from terrorism are hard to compute. Firms can hire competent employees who can help bring the company back to its feet after attacks. Tourists cannot be entirely convinced back to the attacked destinations. Rebuilding the original environment of harmony and peace takes a considerable amount of time and effort. Paris attacks in 2015 drastically reduced the tourist rates by 10%. The direct consequence of terrorism is customers preferring to eat in restaurants and skip specific destinations. Additionally, the customer behaviours changed as they started decreasing the length of their stay and a decrease in hotel bookings.
The September 11, 2001 attacks had substantial effects on the global travel industry. The attack caused the change in preferences to other destinations. There was a drop in visitors flying to the United States. The aftermath of 9/11, generally reduced the demand for air travel globally (Meindl, 2018). The deteriorating economic conditions and safety concerns at the wake of the terrorist attacks negatively influence the arrivals. Acts of terrorism destroy the image of a country abroad making it a less attractive tourist location.
The devastating effects which terrorism cause to the image of the destination is a new phenomenon. Although little surveys have been conducted on this issue, it remains a critical field in the travel and hospitality business. Countries hit by terrorism face huge problems and rebranding the image after attacks is hard. To overcome the poor image, nations are required to increase visitation. There is hope for countries that have been hit by terrorism. As stated by Coshall (2003) these countries can recover after the acts of terrorism. However, studies have shown that travellers are inclined to substituting unsafe destinations with secure locations. The affected nations have to conduct crisis management strategies to recover.
Additionally, these countries engage in marketing recovery methods to achieve a good image. The media plays a significant role in image recovery. The coverage has a role in shaping the image of destinations. Terrorism is deemed to attract the attention of the journalists and the media.
Cultural and social factors have also been identified as the reasons for terrorist targets. The terrorism-tourism connection is argued to stem from foreign cultures interacting with local cultural behaviours. Economic, social, and cultural gaps separate the local people with foreigners. Friction becomes inevitable when the local people are forced to relate to wealthy foreigners who come for luxurious activities. Travellers represent their political cultures, class behaviour, and ideological values. These features may cause discourse between the two interacting cultures. Besides, tourists can attract the heinous acts of terrorism because of their large consumptions (Mendl, 2018). The clash of values is also another reason for terrorism.
Marriott International Chief executive said that domestic politics and terrorism is a significant risk to the hotelier business. He further asserted that the future of the hotel and travel firms lies in the way the government handled terrorist attacks. Governments tighten borders to reduce the risks to terrorism. The attacks in North Carolina, Brussels, and Paris had considerable impacts on the growth of Marriott International. Restricting boundaries is a move that affects the industry in many ways — the macroeconomic issues like terrorism initiate downturns in Marriott. The firm continues to grow despite its merger with the Starwood Hotel and Resorts (Burke, 2016). The chief executive, however, affirms that its loyalty with its customers is responsible for the revenue growth. Terrorism has impacts on various stakeholders of the hotelier companies.
Tourists travel to explore the mysteries of the world. The luxuries presented by different destinations are adventurous and create pleasurable experiences. Awareness of the risks of terrorism continues to increase among travellers and tourists. Terrorist attacks create anxieties and cancellations of trips and hotel bookings. Tourists end up promoting the local destinations due to security issues. Guests check for safety images when looking for destinations to visit. Guests decline hotel in cities with a history of attacks. Tourists are willing to pay for safe locations. Marriott has implementations that protect the rights of their guests.
Workers are significant players in any organisation. When a terrorist attack occurs, human life is threatened. Employees are constant physical bodies in firms. Terrorist attacks have substantial effects on the workplace. First, terrorist incidences reduce job satisfaction and threatens productivity.
Additionally, the wellbeing of the workers, as well as their health conditions, can get damaged. Terrorism causes post-traumatic disorders, mental illnesses, as well as depression and other psychological effects. Other effects of terrorism include loss of employment because of the destructions of companies and organisations. Marriott International uphold human rights principles by creating favourable workplace conditions. Additionally, the company trains its workers to identify suspicious occurrences.
The conditions of the business environment determine the behaviours of the investors. The stakeholders aim to gain maximum profits from their investments. Terrorist incidences cause fluctuations in the stock exchange market. Marriott’s International stock has not been affected entirely by terrorist attacks. However, stock exchange gain stability in the long run in the aftermath of terrorism.
RECOMMENDATIONS OF RISK TREATMENT STRATEGIES
The first line of defence deals with the assessment and accountability of the risk control by the operational management. The managers and unit workers take ownership of the risk and seek strategies to mitigate the threats. This line presents three actions. First, the role of independent assurance provisions, overseeing risks, and owning and managing risks. The operational management guides the implementation and execution of internal procedures to align with goals and objectives. This component introduces solutions to the internal systems and processes of organisations. Supervisory systems need to be in place to guide actions in cases of unexpected events and control breakdown. Marriott should heighten the competence of the operational management to strategically mitigate the threats of tourism. The company should introduce training programs for their employees so that they can identify risks.
To effect the first line of defence, Marriott Hotel made campaigns like ‘Guest Room and Guest Floor’ and ‘See Something? Say Something!’ to create an environment where workers can report and communicate freely. These campaigns are aimed at mitigating risks that can be catastrophic to the business. Employees and top management should be trained recovery, evacuation, and first aid techniques so they can be useful in case of attacks. The firm employees should learn from these incidences on ways to rehabilitate and recover from aftershocks.
The second line defence constitutes the risk management system, which enhances the implementation of risk mitigation practices. This function report on facts about the risks and the targeted groups. The system also monitors the financial report issues and financial risks. This line gives the risk reduction framework as well as controlling issues and risks developing through the process. Additionally, this system controls and evaluates the usefulness of internal activities. Marriott International need to use these frameworks to tame terrorism. The company’s top management should set goals and define responsibilities to manage the risk of terrorist acts.
Marriott has a recovery plan for any case of terrorism. The planning aid to facilitate quick recovery after being hit by acts of terrorism. The short term and long-run plans help the company have clarity in case of terror attacks. To minimise the effects of the bombings, Marriott needs to emphasise the culture of recovery. The firm needs to help its workers and stakeholders accept the risk after it has happened. However, there needs to be a culture of risk acceptance even before it happens. This is encouraging customers to be alert and their skills to adapt to the environment. For instance, Marriott International cannot perform security checks to all its guest and hence, the customers need to be aware of the systems of risk mitigation.
The third line of defence is an internal audit. This line gives the management the objectivity and assurance of conducting operations in the organisation. The framework assures the managers on the conditions of internal controls, risk management, and the effectiveness of governance. The senior governing authorities have power. The administration provides contracts, procedures, policies, regulations, and guidelines to the compliance of the law and ensuring integrity and effectiveness of operations. The elements of internal control include skills to risk response, risk identification as well as risk assessment. This line governs the general functions, operating units, subsidiaries, divisions, and entities involved in risk mitigation. It supports the roles of information technology, budgeting, expenditure accounting, asset management, and human resource application. The Marriott Hotel should have strong governing authority. The existence of a high-level management body means the dutiful performance of roles. Therefore Marriott should encourage internal auditing to uphold the standards of operations.
Marriott International is popularly known for its excellent executive body. The firm has independent security and safety systems of operations. Marriot International incorporate the centralised methods of governance as well as the decentralised systems to mitigate the risks of terrorism in the trade sector. The company should focus on installing physical security setups including fire suppression systems and bomb proof glass. Various security measures suit different properties according to the uniqueness of the tangible assets. Therefore, security systems should be tailored according to the real make of properties. Studies indicate that travellers and guests acknowledge the use of visible security measures like video surveillance and metal detectors. The top management can oversee the need for acquiring insurance to help mitigate loss during events of terror incidences. Additionally, the internal audit can seek the services of the external bodies to have oversight of all procedures in the company. These foreign bodies ensure independence and transparency when dealing with risks.
Burke, K. (2016). Marriott CEO: Terrorism, politics major threats to travel industry. Market Watch. Retrived from: https://www.marketwatch.com/story/marriott-ceo-terrorism-politics-major-threats-to-travel-industry-2016-05-20
Coshall, J.T. (2003). The threat of terrorism as an intervention on international travel flows. Journal of Travel Research, 42(1), 4-12.
Garg, A. (2010). Terrorism – A threat to endurance of Tourism and Hospitality Industry in Indian Sub-Continent Region. Available at: https://www.researchgate.net/publication/263221565_Terrorism_-_A_threat_to_endurance_of_Tourism_and_Hospitality_Industry_in_Indian_Sub-Continent_Region
Radil, S & Flint, C. (2013). The geopolitics of religious terrorism. ResearchGate. Available at: https://www.researchgate.net/publication/237077063_The_geopolitics_of_religious_terrorism
Meindl, A. (2018). The Impacts of Terrorism on Tourism in the EU. Modul Vienna University. Retrived from: https://www.modul.ac.at/uploads/files/Theses/Bachelor/Undergrad_2018/thesis_1411057_MEINDL_Alexander.pdf