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Giovanni Angelini Series: Impact of Epidemics and Pandemics on Hospitality & Plan of Action - Part 1 of 3
By Giovanni Angelini
Monday, 6th April 2020
 

Pandemic Series by Giovanni Angelini, is a senior and well respected professional within the Hospitality industry world-wide and with a wealth of experiences of over 50 years acquired in 3 Continents, Asia in particular. A former executive and the CEO of the Shangri-La Hotels and ResortsThis paper will only address major epidemics and pandemics of the past 2 decade as they have directly impacted on the travel and tourism industry, We all have to accept that epidemics/pandemics come and go and have done so for centuries.

History reminds us of the two major pandemics that the world has faced; the “black dead / bubonic plague” catastrophe of 1346-53 with roughly 200 million casualties and of the “Spanish flu” pandemic of 1918-20 that killed well more than 50 million people.

The most important part is to learn from all of those disasters and we all should try our very best to prevent them and also be ready (individuals -organizations-governments).

Recent Epidemics and Pandemics

  1. SARS (severe acute respiratory syndrome) 2003, origin; Guangzhou-China.
    No. of world-wide cases; 8,437, No. of casualties;813 (9.6%) (epidemic)

  2. H1N1, pdm09 Virus (Swine Flu) 2009, origin; Mexico/(USA?)
    No. of world-wide cases; 1,632,258, No. of casualties;284,500 (17.4%) (pandemic)

  3. MERS (Middle East respiratory syndrome) from 2012, origin; Saudi Arabia
    No. of world-wide cases; 2,494, No. of casualties; 858 (34.4%) (epidemic)

  4. COVID-19 (novel coronavirus) from late 2019 to (ongoing), origin; Wuhan-China
    As of Apr 3, 2020 ; No. of cases;1,025,500; with 53,500 casualties (5.2 %) (pandemic)

(Source: WHO)

(In the mid of a major worldwide outbreak, that as of this date is affecting 205 countries and territories, and no indication yet when it will peak and eventually when it will end. Our hearts go out to the many thousands in our industry who have lost their jobs for no fault of their own and to the many organizations that are forced to go out of business. Let's hope and pray for better times ahead).

Epidemics and pandemics are in general very disruptive for the hospitality business, some more disruptive than others. The outbreak of COVID-19 has devastated the global travel and tourism industry on a scale possibly without precedence in modern history. A few countries/territories within Asia experienced a similar situation with the outbreak of the SARS virus in 2003 but that was more of a regional epidemic and it lasted about 3.5 months while COVID-19 is a worldwide pandemic of a gargantuan scale, it spread much faster and it will last considerably longer.

As the virus and infections are spreading very fast, countries around the world have imposed sweeping travel bans and advisories, some more severe than others, including lockdown/closing of borders with direct impact on hotel business. Temporarily, many airlines grounded most of their planes and a number of hotels had to close down and of course putting jobs at risk. In this labor-intensive industry, people are the best assets for any travel and tourism organization.

Retaining good people is a priority for most but under this drastic drop on the volume of business, shrinking of payroll becomes a must and all organizations will have to make very difficult decisions including large pay cuts, unpaid leave, shorter working week and others.

This may be adequate in some instances but unfortunately, many companies will also be forced to let people go plunging thousands of families into terrible hardship as there are no jobs out there. Handling of this unusual large layoff/furlough of people is perhaps the most difficult and most painful task for any caring leader, very sad indeed.

Travel and tourism is the world's largest industry, it contributes 10.4% of global GDP and employs 319 million people. The impact of the loss of business and, consequently loss of jobs/high unemployment, is so huge that it will send the world economy into a tailspin with most countries/economies falling into recession in the coming months. "A grounded planet with almost all the world's economies to their knees".

The situation has rippled through the whole travel and tourism industry in a way that we've never seen as fast. Most/all of the travel-related organizations, the small and medium-size in particular with depleted cash reserves, will be devastated and in need of urgent financial assistance in particular if the situation continues for several months. The industry may be faced with bailouts, liquidation of assets, sale/mergers and other unpleasant situations.

This crisis is a clear reminder of the fragility of the industry and of the world we live in. And all of us in this business have to ask ourselves a fundamental question on what our respective brands stand for when it comes to social and community causes, safety, and environment. What is more important to us and to the industry, corporate profit or people?.

And in these lines, will this crisis change the consumer/guests' priority on selecting a lodging facility in the future? Will we see more conscientious travelers focused more on sustainability, care and protection of this disordered and sickish world? And what brands have to do to earn the "trust" of the caring travelers in those crucial areas?

One of the lessons we have learned from the COVID-19 pandemic is the importance of acting early and fast by all and for all sectors. Early intervention, meticulous tracking, and decisive actions are imperative as those cannot be delayed. Must for any organization to be prepared at all times to face and tackle any type of crisis. In this case, many countries were complacent at first and once they realized the size of the problem, they went into overdrive to make up for their laxity. By this time, the contagion had spread and out of control.

With the pace of economic integration and globalization in the past few decades, we all now live in a global village. Person-to-person contact is now so frequent and intense that the world is all more vulnerable to new epidemics and pandemics and outbreaks will happen.

The virus does not respect borders and practically impossible for countries to shut-down in full. This why governments, and the private/business sectors, must be prepared at all times, both are in need of strong leaders.

This outbreak has raised serious questions about global public health security and of the enforcement of health regulations around the world and the lack of closer global cooperation in research, development, and production of quality, safe and effective medicines and vaccines. The world may be better off with less diplomatic tensions and political debates and focus more on overhauling economic globalization, restructuring global governance and reshaping geopolitics.

Impact on the way we live & behave?

Will the recent coronavirus (COVID-19) change how we live? And will it change bad habits? This virus is a reminder that the world is not as controllable as it appears to be. We need to recalibrate and reevaluate our life to what is really important and put an end to the selfishness.

The outbreak may bring a much-needed end to an era of economic excess and overindulgence/consumerism and of taking advantage of the systems put in place by the politicians. The short and the long term effects of this virus on individual finances is of significant concern. But something had to happen to halt the headlong rush towards the perdition of over-indebtedness, overpriced assets, and corporate greed. Those are not sustainable. Things may not be the same again and the world has to change to a better and practical balance.

Even after it subsides, the COVID-19 pandemic will have wide-ranging and lasting repercussions on our lives. The recovery of our shattered societies depends on our deep examination not only on personal hygiene, on how we live, on how we spend and travel, and on how we treat friends, strangers and ourselves. But also on how governments, at local-national-international levels, have failed in their basic duty to protect citizens, and how they must learn and improve.

All over the world, people are slowing down, reflecting and are waking up to a new reality. And let's hope that the present hard time makes people stronger and can come out of the crisis wiser than before. For time being, take care of yourself and of your family. Remember the basics in hygiene, social distancing and isolation as much as possible.

What have we learned from this fast-spreading and deadly outbreak, COVID-19?

(This is unlike anything we've ever experienced and an opportunity for all of us to learn from this abrupt disaster)

A pandemic is the most serious destabilizer, by any standard, on the hospitality industry and the most severe damage it can do to put our business to a halt. The worst crisis ever to hit the travel industry, a cruel blow. As caring hospitality professionals, we learned that during those unsettling times, both physically and emotionally, the safety and the health of the people come before revenue and profits, "health before wealth".

It is a clear reminder to all of us how precious is our health and our families. A reminder that in front of a nasty virus, we are all equal and that all human beings share a common destiny regardless of race, ethnicity, religion, ideology, social position, rich-poor, location, and political beliefs.

We learned that Governments should have been paying much more attention to investing in the public health care system and be better prepared for emergencies and catastrophes and also that the authorities must act swiftly and aggressively when faced with dangerous viruses, not playing politics and pointing fingers when the crisis breaks out.

Learned that International cooperation, transparency and timely sharing of first-hand information on all aspects of the virus, including tracking, spread patterns, changing symptoms and possible preventive measures should be made mandatory. Countries must be on the same page when it comes to multilateral global governance and not isolate themselves. This is a time when the world needs to come together to fight the pandemic.

That a pandemic affects personal livelihoods and Governments must be prepared to offer financial assistance, subsidies, reliefs and other types of assistance to reduce the impact on its people and to business. And learned that the hospitality industry must be united on soliciting reliefs from the authorities. Travel and tourism is a major industry providing more jobs than any other business.

We all learned the importance of Governments and for organizations to strongly promote and educate people on personal hygiene, including social distancing in this case. And on how to handle pandemics and emergencies, prevent panic and anxiety, and have a clear plan/document in place for all to refer to as an effective measure in avoiding infections.

We learned that false and misleading information about coronavirus pandemic seems to be contagious and we all have to realize that fake news spreads faster and more easily than this virus and is just as dangerous.

That pandemic creates regional/global financial recessions and in response to this, the key role of hospitality/business leaders is to protect their people/jobs, manage controllable expenses, preserve cash, be creative/innovative and prepared for the recovery.

Pandemics are not solved by politics nor by military strengths and even less by weak politicians/leaders. Unfortunately, also learned that many politicians/head of states/leaders are not up to the task as "unparalleled times require unprecedented actions" and many autocrats/leaders are simply lost and/or playing politics and on top of it, are clueless on getting a sustainable recovery back on track. Blaming others is counterproductive and not going to help us solve the problem sooner.

The world could do with more international empathy, solidarity, and cooperation on developing cures and vaccines to fight deadly viruses now and in the future. All countries should invest much more money in people's health and less on military/defense.

Unfortunately, the whole world has to learn and accept that under the best of circumstances there's going to be a very difficult challenge for mankind and there should be "no illusion that we have won".

In some cases, and due to an unusually low volume of business, we learned the process of temporarily closing hotels/businesses and on how to handle staff's continuous basic income, communication with customers, suppliers, partners, and all others involved with the business. And of course, when times comes, a reopening process/plan.

And finally, a strong reminder that we must take much better care of our sick planet, that we should have more respect for nature and conduct/practice a sustainable lifestyle on all that we do. We all wait with bated breath for this crisis to end but it appears that a lot more work remains to be done.

Giovanni Angelini
A 50 year veteran of the Hotel-Hospitality-travel industry with a wealth of experience acquired in 4 Continents, Asia in particular. A long term resident of Hong Kong and Retired Chief Executive Officer of Shangri-La International.

A board member of several large corporations and member of many industry related and quality management organisations. Founder of Angelini Hospitality, providing consultancy and advisory work to developers and hotels-travel-tourism organisations.

Recipient of two Honoris Causa (Doctorate) in Business Administration and in Global Business Leadership, four Lifetime Achievement Awards, the 2006 Corporate Hotelier of the World, Maestro del Lavoro (2014) and of several other recognitions and awards.

www.angelinihospitality.com

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