Research Article: 2021 Vol: 20 Issue: 6S
Saif Saeed Juma Albawardi, Universiti Teknikal Malaysia Melaka
Nusaibah Mansor, Universiti Teknikal Malaysia Melaka
Siti Norbaya Yahya, Universiti Teknikal Malaysia Melaka
Risk culture is the scenario of controlling, recognizing, and assessing threats that impact the organization's performance. Risk culture attempts and analyzes the potential hazard for future threats that strategize diversification through effectively manage risk. Recent events have reminded the organization's culture to comprehensive view on risk and provide significant control and incentives to overcome it. The main drive of this research was to discuss the relation between organization risk culture factors and tourism performance within the UAE. The major research question was whether organization risk culture factors influence tourism performance in the UAE. This research intends to yield interaction of e-tourism and tourist impact relationship between organization risk culture factors and the tourism performance in the UAE. The research main outcomes focus on developing the conceptual model of organization risk culture towards tourism performance in the UAE.
E-Tourism, Organization Management, Risk Management, Tourist Culture, Tourism Industry
Risk culture encompasses the practice of analyzing, identifying potential risks in advance, and responding through taking precautionary steps to curb risk as part of the life of an organization (Papaioannou & Shen, 2018). Yet, it allows risk events to be managed and understood proactively through minimizing threats by optimizing success and maximizing opportunities for better outcomes (Angel, Menéndez-Plans & Orgaz-Guerrero, 2018). Therefore, avoiding risk culture will create wreak havoc through a broad diversity of sources on legal liabilities and strategic management errors that are considered a risk venture (Pellegrino, Costantino & Tauro, 2020). Yet, different levels of risk come with different categories of environment that tend to diversify the action to minimize the exposure of the risk itself (Mailasan Jayakrishnan, Mohamad & Yusof, 2020c).
Risk culture in the digital world focus on data-related risks and security threats that attempts and analyze the potential losses for the organization (Papaioannou & Shen, 2018). Thus, appropriate action needs to be taken through controlling and identifying these threats (Mohamad, Jayakrishnan & Nawi, 2020). In UAE, countless risks impact the organization's performance that delays the key milestone, reduction in profit, and indifference for a solution (Naheem, 2020). We have a review on risk culture for the importance of achieving strategic goals for an organization in UAE that indicates on (1) executives working in risk areas stated that 61% will become much more important in emphasizing risk culture in an organization, 33% on becoming somewhat more important in an organization and 6% will stay the same importance within an organization, (2) risk non-owners stated that 62% will become much more important in emphasizing risk culture in an organization, 31% will become somewhat more important in an organization and 7% will stay exactly the same importance within an organization and (3) risk owners stated that 49% will become much more important in emphasizing risk culture in an organization, 49% will become somewhat more important in an organization and 3% will stay the same importance within an organization.
Therefore, we need to focus on risk culture, as a key opportunity to provide a solution plan on risk events that impacts the organization's performance. Besides implementing a risk management plan can avoid potential threats and minimize the impact of a better decision-making process (Mailasan Jayakrishnan, Mohamad & Abdullah, 2019a). Moreover, risk management can help an organization to perform its objectives and emphasize a proactive risk culture that can achieve greater outcomes (Angel et al., 2018). Thus, an organization needs a risk management structure that can be tailored to point out existing risks and predict the uncertainties or influence threats within an organization (Schuhmann & Eichhorn, 2017).
Yet, we have identified three (3) major response that needs to be implemented in an organization risk management structure as (1) avoidance on the particular risk that impacts the organization performance, (2) mitigation on lowering the possibility of the risk toward the organization performance and (3) acceptance on organization risk toward creating a contingency plan for reducing the impact of the risk within an organization performance. These responses should be emphasized as a problem-solving approach for an organization's risk that derived a well-detailed action plan that can be implemented within an organization's performance. Moreover, we justify these contingency action plans will handle the barriers of risk for an organization towards encountering such risk in the future and arise in success. Therefore, we need effective risk management for total control of future outcomes of an organization's performance on reducing both possible risk impact and occurring environment.
Risk culture empowers an organization with effective tools that can identify the potential risk within an organization's performance and make a proper decision making on managing the risks (Papaioannou & Shen, 2018). Besides, it is the best way for making progress and growing the organization's performance for handling these threats and structuring them as high priority actions that need to be done (Angel et al., 2018). Moreover, it consists of the necessary information for decision-making on the risks and ensures the organization for better performance. We are stating that risk culture can be implemented through a model for risk assessment that maps the responsibilities of risk within the domains of an organization's performance and determine the threat level faced by the organization. We interpret risk culture can change the organization's risk profile and access performance through risk assessment within the UAE industries.
We conceptualize the organization risk culture factors as decision-maker, organization structure, political, and technological. Therefore, organization risk culture will increase tourism performance as a case study in the UAE. To design and apply a conceptual model, we requisite a primary question on developing a conceptual model stipulating the relation between organization risk culture factors and the tourism performance in UAE. Thus, this study intends to discuss the interaction of e-tourism and tourist impact relationships between the organization risk culture factors and the tourism performance in UAE and conceptualized a model for the organization risk culture factors and tourism performance within UAE.
Organizational risk culture can be anticipated through well planning and coordinating actions that can reduce threats to a tolerable level (Corelli, 2019). These threats can be negatively or positively impacting the execution of the organization (Dimitrovski, 2020). Therefore, the organization needs to ensure these threats by clearly identifying and performing risk analysis (Angel et al., 2018). We classify risk analysis can be conducted through four (4) steps; (1) identify existing risk by brainstorming all the sources through analyzing the potential effects on behavior, and organization performance, (2) assess the risk through identifying the problem and support through new solution tactic, (3) develop an appropriate response by preventing the identified risks and increase the probability of a positive opportunity for an organization performance and (4) develop a preventive mechanism for identified risks through contingency plans that can be implemented in the future and monitoring the risks for chain reactions within an organization performance.
Therefore, we conducted a systematic literature review to identify the organization's risk culture factors and tourism performance. The systematic literature review is a method that focuses on strategizing the body of literature for research that needs to be reviewed and aggregated their specified indicators for the study. Conducting a systematic literature review will critically review the research problems and summarize the solution clearly for the research study. Moreover, it will identify the indicators that require further investigation for the research study. Furthermore, it is useful to integrate the information of organization risk culture factors for tourism performance based on a systematic literature review process. Therefore, we have identified our organization's risk culture factors towards tourism performance based on the systematic review, as shown in Table 1.
Table 1 Overview of Organization Risk CultureFactors Towards Tourism Performance |
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Organization Risk Culture | ||||||
No | References | Decision Maker | Organization Structure | Political | Technological | Indicators |
1 | (Atadil et al., 2018) | √ | √ | Focus on the decision-making under risk and under certainty. | ||
2 | (Coskun et al., 2019) | √ | √ | √ | ||
3 | (Dimitrovski, 2020) | √ | √ | √ | ||
4 | (Emeagwali, 2018) | √ | √ | |||
5 | (Papaioannou & Shen, 2018) | √ | √ | √ | Identify risks and develop action plans for the organization. | |
6 | (Connelly & Sam, 2018) | √ | √ | √ | ||
7 | (Tang et al., 2018) | √ | √ | √ | ||
8 | (Vantrappen & Wirtz, 2018) | √ | √ | √ | ||
9 | (Walls et al., 2019) | √ | √ | √ | Focus on the political risk position and environment. | |
10 | (Farmaki et al., 2019) | √ | √ | √ | ||
11 | (Stephens et al., 2019) | √ | √ | √ | Focus on the marketing environment and value concerns. | |
12 | (Kelly & Lawlor, 2019) | √ | √ | √ | √ | |
13 | (Willems et al., 2019) | √ | √ | √ | ||
14 | (Zhu et al., 2019) | √ | √ | √ |
Based on Table 1, we have identified the relationship between the organization risk culture factors and tourism performance through (1) Decision Maker where decision making under risk focus on variation of present probabilities that associated with each possible state(Atadil et al., 2018; Emeagwali, 2018) and decision making under certainty focus on complete knowledge of the outcome of each decision alternative that been implemented within an organization performance (Coskun et al., 2019; Dimitrovski, 2020), (2) Organization Structure where identify risks that the organization faces and respond to those risks through action plans (Papaioannou & Shen, 2018; Tang et al., 2018) and develop action plans into reality to overcome the risks faced by an organization and increase efficiency for solving the problems (Connelly & Sam, 2018; Vantrappen & Wirtz, 2018), (3) Political where political risk focus on regional powers that impacts the organization performance and value drive that continues the growth of an organization (Dimitrovski, 2020; Walls et al., 2019) and political environment consists of boundaries of an organization through direct impact of risk and needs a value system practice to overcome this threats (Dimitrovski, 2020; Farmaki et al., 2019) and (4) Technological where marketing environment focus on comprehensive marketing plan by identifying the risks and encounter through executing strategy within an organization performance (Stephens et al., 2019; Willems et al., 2019) and value concerns on the foundation of risk management and assessment through further developments that need to encounter potential risks within an organization performance (Kelly & Lawlor, 2019; Zhu et al., 2019).
Moreover, there is an intimate relationship between e-tourism and tourist impact. Understanding this relationship is principal for researchers by prospecting the theoretical framework for organizational learning and organization culture. We have adapted and prospected the Organization Learning Theory and Organizational Culture Theory for this study. The Organizational Learning Theory emphasis the process to improve and gaining experience that creates knowledge for effective risk management (Monsen & Boss, 2018). Hence it transfers the knowledge for strengthening and reflecting to overcome the risks faced by an organization (Morgan & Vorhies, 2018). We can explain Organizational Learning Theory as an initial action for the relation between the organization risk culture factors and the tourism performance as indicated in Table 2.
Table 2 The Organizational Learning Theory For Organization Risk Culture |
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Components | Classification | Indicators | References |
Values and Norms | A part that focuses on organizational culture on overcoming threats and express the values. | Decision Maker | (Gökdeniz, Kartal, & Kömürcü, 2017; Illes & Vogell, 2018) |
Examine the risk implementation and options for decision-making within an organization's performance. | |||
Strategies and Assumptions | Shaping the methods and goals for encountering risk and evolving valuable strategies. | Organization Structure | (Barabba, 2018; Englmaier, Foss, Knudsen, & Kretschmer, 2018; M Jayakrishnan, Mohamad, & Yusof, 2019) |
Oversight the risk and verify the adequacy of risk management procedures in an organization's performance. | |||
Political | |||
Implementing useful insights into potential risks that might encounter through government policies. | |||
Consequences | Motivates change and generates new approaches to reducing risks within an organization's performance. | Technological | (Saks, 2019; Wardhani, 2019) |
Identify the risks from the organization system and analyze the data information for risk management strategies. |
Based on Table 2, the Organizational Learning Theory expounds on organization risk culture factors. The Organizational Learning Theory is the metaphor for the organization in learning and organizes its risk management policies for better performance (Chia, 2017). Thus, organization risk culture can be implemented through organization culture that focuses on attitudes and behavior on making the right decisions. The Organizational Culture Theory relates the organization risk culture factors and tourism performance on decision-makers, organization structure, political, and technological that indicates better performance for an organization. Yet, it focuses on the foundation of an organization's performance and strategies towards managing the potential risks through insights (Gorondutse & Hilman, 2019). Moreover, Organizational Culture Theory involves the organization's process, technology, and people for interaction towards risk management procedures and triggers culture risk within an organization (Firmenich, 2017). We can explain Organizational Culture Theory's priority on the fact that pivots on cultural principles to current risk condition on three (3) elements, as indicated in Table 3.
Table 3 The Organizational Culture Theory For Organization Risk Culture |
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Components | Classification | Indicators | References |
Artifacts | Identify the approaches that will be used to encounter the risk with an organization's performance. | Decision Maker | (Lagos, Mos, & Cortes-cornax, 2018; Ljungkvist & Boers, 2019) |
Making the right decision for an organization through balancing risk and performance. | |||
Beliefs and Values | Ensures adequate attention to protecting organization value and constraints risk behaviors within an organization's performance. | Organization Structure | (Gill, Mand, Biger, & Mathur, 2018; Mailasan Jayakrishnan, Mohamad, & Abdullah, 2019b; Roy, Rabbanee, Roy Chaudhuri, & Menon, 2019) |
Requires a risk management plan that addresses strategic and response behavior within an organization's performance. | |||
Political | |||
Broaching the ideas on reducing the political risk of raising issues within an organization's performance. | |||
Assumptions | Allowing the planning process that explicit possible ways to reduce risk within an organization's performance. | Technological | (Pellegrino et al., 2020; Rupcic, 2019) |
Expansive use of technology in reducing the strike of risk on the organization's outcomes. |
Based on Table 3, the Organizational Culture Theory expounds on organization risk culture factors. The Organizational Culture Theory provides a significant impact on risk management through its discipline and capability in analyzing behavior risk within an organization's performance (Zhang & Dai, 2019). Thus, it defines the applied culture within an organization towards risk management and maximizes value in decision-making (Lagos et al., 2018). We can conclude that the theoretical framework is mapped with the organization's risk culture factors and tourism performance.
Framework Development
Understanding the potential risk that an organization face is every crucial nowadays (Kucuk Yilmaz, 2019). Hence, practitioners need to gain valuable insights on enhancing risk culture within an organization's performance that creates value. Besides, we need to understand the future regulatory issues, potential future risks and why do risks occur in a wide variety of organizations in a country. In the UAE, the tourism industry is triggered by a risk dilemma that can impact its performance and creates an economic impact (Al Dhaheri & Ahmad, 2019). The tourism industry in UAE is the highest-ranked country in the Middle East that ranked 33rd out of 140 countries on the global tourism and travel index in the year 2019. Besides, it contributes Dh208.2 billion for the earlier six months in the year 2019 on Emirate’s Gross Domestic Product (GDP) for the tourism industry context.
Yet, executives and directors of the tourism industry cannot manage risk casually due to the rapid pace of Dubai as the primary option for business travelers and international leisure (Anthonisz & Mason, 2019). Moreover, we have a review on UAE tourism industry contribution based on (1) shopping as mainly contributed 36% for its variety of activities on soaking with local culture, (2) accommodation contributed 26.7 % for high-end hotels offering unmatched luxury, (3) passenger transport contributed 18.0% for motoring paradise on the low cost of fuel and top car brands, (4) food and beverage contributed 14.4% for Emirati cuisine on reflecting the culture and (5) travel agencies contributed 4.4% for all requirements of services in UAE. Therefore, organization risk culture factors needed to be identified and analyzed for better performance of the tourism industry in the UAE. Thus, the UAE tourism industry is expected to attract 20 million visitors per year by 2022. For this purpose, we have compiled the organization risk culture factors toward the tourism performance, as indicated in Table 4.
Table 4 The Organization Risk Culture Factors Toward The Tourism Performance |
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No | Organization Factors | Risk Culture | Tourism Performance Indicators | References |
1 | Decision Maker | Decision Making under Risk | Functional Value | (Atadil et al., 2018; Coskun et al., 2019; Dimitrovski, 2020; Emeagwali, 2018; Gökdeniz et al., 2017; Illes & Vogell, 2018; Lagos et al., 2018; Ljungkvist & Boers, 2019) |
Puts an organization in the best position to plan and manage the risks through flexible response. | Focus on all outcomes associated with probabilities and define the solution. | Tourism industry integration | ||
Decision Making under Certainty | ||||
Predict expected results for decision-making alternatives in managing the risks. | ||||
2 | Organization Structure | Identify Risks | Social Value | (Barabba, 2018; Connelly & Sam, 2018; Englmaier et al., 2018; Gill et al., 2018; Papaioannou & Shen, 2018; Tang et al., 2018; Vantrappen & Wirtz, 2018) |
Conduct an appropriate manner of planning and standard approaches for encountering risks. | Ability to identify potential risks that pose a threat to organization performance. | Tourism industry transcendence | ||
Develop Action Plans | ||||
Realistic set of risk management strategies for desired organizational goals and future steps context. | ||||
3 | Political | Political Risk Position | Emotional Value | (Dimitrovski, 2020; Farmaki, 2019; Roy, 2019; Walls, 2019) |
Actions to promote government policies that pose significant risks to organizational performance. | Emphasis on the knowledge of politics that generate complex ideas to overcome the potential risks. | Tourism industry attractiveness | ||
Political Environment | ||||
Focus on a better decision for risk management that is implicated from government policies. | ||||
4 | Technological | Marketing Environment | Epistemic Value | (Kelly & Lawlor, 2019; Lagos et al., 2018; Ljungkvist & Boers, 2019; Saks, 2019; Stephens, 2019; Wardhani, 2019; Willems, 2019; Zhu, 2019) |
Accessing and monitoring data for possible risk or situation that impacts the performance of an organization. | Managing the risks through the information available and predict the sudden change in the local marketing environment. | Tourism industry actualization | ||
Value Concerns | ||||
Providing insights in risk planning and ensuring effectiveness through the strategic risk management process. |
Based on Table 4, the organization risk culture factors toward the tourism performance at each stage of their development have been mapped. Organization risk culture factors focus on decision-makers, organization structure, political and technological will create a better performance for the tourism industry through epistemic value, emotional value, functional value, and social value within the UAE. Moreover, it modeled a system of values that consist of the behavior and elements of an organization to shape risk decisions and understand its business purpose. Therefore, we need to critically review tourist impact in the tourism industry, where tourist impact will provide jobs and improve the wealth of an area as quality of life. Besides, it also brings good policymaking and investment decisions for the industry itself. We can classify tourism impacts s economic, socio-cultural, and environmental as shown in Table 5.
Table 5 The Tourist Impact |
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Impacts | Classification | References |
Economic | Impact through growth and employment that generates income to the nation that contributes to a positive quality of life. | (Latip, Rasoolimanesh, Jaafar, Marzuki & Umar, 2018; McLoughlin & Hanrahan, 2019) |
Socio-cultural | Impact through tourism experiences that involve human interaction and behavior change for deeper learning the local cultures. | (Eusébio et al., 2020; Hamid, Wee, Hanafiah & Asri, 2016; Mailasan Jayakrishnan, Mohamad & Yusof, 2020d) |
Environmental | Impact through transforming the environment from micro to macro staggering rate in culture identity and values for resources. | (Eusébio et al., 2020; Mailasan Jayakrishnan, Mohamad & Yusof, 2020a; Signorile, Larosa & Spiru, 2018) |
Based on Table 5, the tourist impact act as the mediating variable for the organization risk culture and tourism performance in this research study. The mediating effect through economic, socio-cultural, and environmental will structure the sector and its integration into the organization risk culture and tourism performance for effective measure and monitor. However, the tourist impact both in monetary terms and predominance within the poverty stages. Therefore, to encourage tourism, we need to utilize digital technology in e-tourism. E-tourism is the adoption of information and communication technology to transform the value chains of tourism performance (Mailasan Jayakrishnan, Mohamad & Yusof, 2020b). Yet the dynamic of e-tourism focuses on the technical, social, and environmental that requires greater effort in coordinating the services and maximizing the profit. Table 6 shows the e-tourism variables for information-intensive that changing the structure and balance the business for tourism experience and provides behavior understanding and knowledge for the industry.
Table 6 The E-Tourism |
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Impacts | Classification | References |
Technical | Focus on efficiency and competitiveness in searching information for tourist and business performance that increase the organization operations. | (Gao, Gong, Zhang, Mao, & Liu, 2019; Thakhathi, 2018) |
Social | Focus on tourist relationships that involve interactions between humans and culture that increase satisfaction and maximize the business profits. | (Subrt, 2019; Šubrt, 2020) |
Environmental | Focus on environment development that gathers tourism information for attitude changes and information resources to gain more trust. | (Gao et al., 2019; Thakhathi, 2018) |
Based on Table 6, e-tourism act as the moderating variable for the organization risk culture and tourism performance in this research study. The moderating effect through technical, social, and environmental will shift the technology context between the organization risk culture and tourism performance for organic results that produce the planning stage and cultural barriers associated with risk management. Thus, we have a map and developed a conceptual model of organization risk culture factors toward the tourism performance, as indicated in Figure 1.
Based on Figure 1, the conceptual model of organization risk culture factors toward the tourism performance indicates the factors in risk management as the independent variable on decision-maker, organization structure, technological and political in UAE with the mediate variable on the tourist impact and moderate variable on the e-tourism. Thus, we have expounded our dependent variable for the performance of the tourism industry as epistemic value, emotional value, functional value, and social value. This initial conceptual model can be utilized by other agencies or countries to embrace related organization risk culture factors toward the performance of the industry.
Risk is a part of organization planning that occurs anytime during the life cycle of an organization. Thus, potential risk can have a positive or negative impact on organizational performance. Yet, implementing an organization risk culture will reduce the specific risks and archive knowledge that can be adapted for organization value. Moreover, it structures the risk information for desirable performance that increased volatility. We need to encounter risk in an organization before it is too late. Organization risk management is a dominant component associated with the organization's performance towards market volatility and enabled the organization to survive in the future. Hence, it helps an organization to establish strategies to avoid potential risks and cope with better organizational performance results. Thus, this research pivot on developing a conceptual model of organization risk culture factors toward the tourism performance, which strategizes the understanding of risks that can influence the performance of an organization.