Hotel’s grid group structure and risk management practices

Risk management is an emerging research area in tourism and hospitality. This paper classifies hotels based on grid (control) and group (inter dependencies) structure given by the cultural theory of risk. This paper aims to understand whether hotels grouped as per grid group structure differ on risk coping strategies such as mitigation, absorption and transfer for various hospitality risks.

Primary data are collected from 112 senior managers of luxury hotels using structured questionnaire aimed to capture the grid group aspect and risk management practices. Using factor scores, hotels are grouped. One-way analysis of variance is performed on these data to ascertain whether risk management practices of various types of hotels differ.

Results provide new insights into hotels grid group aspect and risk-related behaviour, revealing that hotels significantly differ on risk coping and confirming that the structure of hotel – the grid and group – does impact its risk management practices.

The study adds to the extant literature. For the first time, the grid group structure of hotel is proposed to impact the risk coping. Second, the risk perception study is conducted at firm level and not at individual level as done in past. Third, the paper looks at all three risk management practices and not in isolation, thus taking the risk research dialogue further. The study has not considered non-luxury hotels. Second limitation is a small sample of 112 hotels.

The study opens up a new perspective on hotel risk management. The researchers will benefit from the newer, theoretical understanding of firm-level complex structure of risk. The hotels risk professionals can benefit from understanding grid group structure and risk coping practices.

The novel approach of grid group classification of hotels is developed. Risk management practices are studied across hotel types for various risks. Study enhances the understanding of risk and grid group structure with regard to managing hospitality risk.