Risks During the Construction of the Burj Al Arab Hotel - Term Paper Example

Burj Al Arab Hotel Risk Assessment (Student Name) (Course No.) (Lecturer) (University) (Date) Burj Al Arab Hotel Risk Assessment Description of Burj Al Arab Hotel The Burj Al Arab is considered the tallest hotel in the world. With that position, the hotel required many construction professionals to ensure the reduction of risk occurrences that might affect the lives of people and the ecosystem. The hotel does not only reflect the ambition of the architects, but also the perspective of the client’s needs. Currently, the hotel complies with the UAE laws, international, and local legislations such as health, safety, environmental aspect, and insurance policies to assist with risk reduction (Gonzalez, 2014, 172). Considering the magnitude of the project, the engineers had to meticulous in their roles. The building stands within an island 270 meters from the natural beach. Therefore, there was need to create a strong base to enable the building withstand the waves and earthquake associated risks. Tick List S/N Risk Assessment Measures No Yes 1. Adequate measures of quantifying the magnitude of waves ✓ 2. Earthquake risk assessment procedures ✓ 3. Compliance with risk assessment regulations and practices ✓ 4. Emergency evacuation measures ✓ 5. Frequent monitoring and evaluation of system performances ✓ 6. Accessibility of the emergency codes within the hotel ✓ 7. Measures of terrorism and illegal activities ✓ 8. Treatment of waste materials before disposing into the water mass ✓ 9. Protection of financial resources from cybercrime activities ✓ 10. Occupational health and safety measures ✓ 11. Demarcation of hazardous areas or out of bound areas for customers ✓ 12. Protection from adverse environmental conditions such as lightning ✓ 13. Monitoring of the power systems to prevent failures ✓ 14. Inclusion of all risk assessment steps during assessment ✓ 15. The solutions focus on prevention and organizational level ✓ 16. Integrative participation and commitment from all stakeholders ✓ 17. Frequent risk auditing measures for gap identifications ✓ 18. Effective method of communicating the identified risks ✓ 19. Documentation of risk auditing to enable adjustment of practices ✓ 20. Procedures for evaluating and reviewing the risk assessment methods ✓ What the Tick list Shows From the analysis, it is clear that the hotel complies with several methods of reducing the risks on both the environment and people. However, there is need to ensure participation of all stakeholders in the process. The Tick list assist in ensuring the analysis of all processes involved in the organization. Besides, it reflects the gaps in risk management methods (Polly, 2009, 152). Pros and cons of tick list method The method encourages motivation to handle the problems that are more evident. Checklists allow organization of the identified issues and setting of priorities depending on the level of severity and the need. Besides, it allows easy delegation of duties (Pizam, 2005, 122). However, the method requires much time due to documentation, works effectively if the in-charge has adequate skills, and to some extent, it might lack specificity of the goals. SWOT Analysis Strengths Weaknesses The building infrastructure that looks like a sail boat gives the customers fine and distinct experience The magnificent oval aquarium is visible throughout the hotel Popular brand image globally The only seven star hotel in the world with personalized products and services Most investors view Dubai as a tourist destination though it is more of commercial destination which might have great impact on the hotel The rigid climate and cultural practices in Dubai do not encourage flexibility of the hotel The driving economic force in the country is oil and gas which means the government focuses less on the hospitality and tourism industry Opportunities Threats With the development of Dubai into commercial destination, the hotel is attracting many business travelers The country more on building several theme parks and sport activities which might assist to attract many international tourists Several new entrants into the industry High accommodation prices that give advantage to the others Declining growth rates of the tourism industry Low demand associated with the effect of global financial crises on the UAE market What the SWOT Shows The methods reflects the numerous competitive advantage enjoyed by the hotel in ensuring that it remains the preferred destination of most tourists. SWOT as a strategic analysis tool, it allows the hotel management to study their performance and analyze their market position (Gonzalez, 2014, 161). Weaknesses and threats are the major factors affecting the performance of the hotel at global scale. Pros and cons of SWOT method The method is simple and flexible. Besides, its implementation does not require technical knowledge and skills, allows synthesis and integration of different various information types that are known generally but contribute to possibility of organizing and synthesizing the recent information (Altenbach, 2013). However, the drawbacks are that all the listed factors require consideration during the analysis, inadequate prioritization of the factors, and inadequate suggestions of solving the disagreements. Fishbone Faulty testing equipment Poor supervision Out of adjustment Incorrect specifications Inadequate concentration Tooling problem Inappropriate measuring methods inadequate training Aging of the material Inadequate waste treatment Defection from vendors Poor process designs Contamination of water Not to specifications Ineffective management of quality Handling problems Deficiencies in product designs What Fishbone Shows From the analysis, it is clear that all the resources and processes used in the hotel determine the quality of services offered. The method reflects the relationship between various processes, resources, and the outcome (Polly, 2009, 155). Therefore, the concept involves identification of the cause and effect of certain risks involved in the business. Pros and cons of Fishbone Method The method assist in problem identification and provision of convenient and easy method of understanding the easiest method of listing the possible causes of problems experienced. However, it does not simply solve the problems nor offer solution for the identified potential failures (Gonzalez, 2014, 201). It makes all the possible causes of the effect look equally plausible and important. Bowtie Method What Bowtie Shows From the analysis, inclusivity is important in reducing the negative risks associated with the hotel. With the declining efficiency and performance, the hotel is likely to experience reduced number of customers owing to poor service delivery methods. There are several barriers to achieving better results, however, the method converges the possible potential effects to allow extensive analysis of the consequences (Polly, 2009, 169). Pros and cons of Bowtie Method The method offers an excellent risk communication tool that is easy to learn, understand, and interpret. Besides, it uses group knowledge during development, which makes it easy to develop faster (Bruder & Roncalli, 2012). However, quantification of the identified risks requires modification, robust risk matrix, and software to ensure proper documentation. In addition, it becomes complex if the system is large. Risk Ranking Method Rank Hazard/Risk Likelihood Effect and affected asset 10. Cyber attack Uncertain Financial losses and reduction in trust among the stakeholders and investors 9. Effects of cyclonic activities Low Casualties, destruction of property, business interruption, and environmental contamination 8. Electrical and mechanical breakdown High Suffocation and anxiety especially those in lifts, fear, and loss of esteemed customers 7. Economic problems Certain Inflations, loss of confident in market and industrial performance by the investors, and interruption of the supply chain 6. Contamination of the water surface due to system failure uncertain Lawsuits, risk of business closure, and loss of customers especially those that are environmental sensitive 5. Unsustainable competitive advantages Very certain Competition for customers among hotels could lead to losses associated with implementation ineffective marketing strategies 4. Earthquakes and tremors Uncertain Casualties, property destruction, and business interruptions 3. Accommodation of wanted criminals Uncertain Accusation of justice destruction and conspiracy to evade the law, loss of confidence among the customers 2. Fire explosion Low Casualties, property destruction, and business interruption 1. Food poisoning Low Casualties, reduction in trust among the customers, and lawsuits for compensation What the Risk Ranking Method Shows The method identifies different risks associated with the hotel’s activities and process that might yield potential risks then ranks them depending on the probability of occurrence (Surroop & Abhishekanand, 2013, 187). The risk that has the highest probability of occurrence is uncompetitive competition strategy due to the ever-increasing number of hotels cropping up in the industry. From the method, it is clear that the hotel is likely to experience different risks. Pros and cons of Risk Ranking Method The method assists in quantification and prioritization of the risk, estimation over time, and handling the dependencies, redundancy, and special roles. Evaluation of the “what ifs” is easy and quickly which encourages time saving. However, the method can be labor intensive especially for the large institutions (Surroop & Abhishekanand, 2013, 385). Besides, untrained personnel do not easily understand it, as it requires special analysts for building the models. The quality of model used depends on data quality. Failure Mode and Effect Analysis (FMEA) Hotel Processes Potential Failure Mode Potential Effect(s) of Failure Sev Potential Cause(s)/ Mechanism(s) of Failure Occur Current Process Controls Detec RPN Recommended Action(s) Responsibility and Target Completion Date Action Results Actions Taken Sev Occ Det RPN Guest support Lack of barrier-free hotel Inconveniencies and customer dissatisfaction 10 Failure to provide barrier free facility 3 Provision of barrier free facility 7 210 Add barrier free facility Management Recommended 8 2 5 80 Unclear signs Failure to locate the rooms 8 Signs out of date and identifications removed 3 Post and signs 4 96 Periodic inspection and maintenance Management Recommended 5 2 3 30 Poorly planned equipment Personal injury 6 Inappropriate equipment 5 Equipment replacement 3 90 Periodic inspection and repair Management Recommended 5 4 3 60 Service desk Failure to register clients on time Complaints 6 Inappropriate communication skills 4 Training on customer handling methods 5 120 Making complete training plan Management Recommended 5 3 4 60 Emergency medical services Services not in time Worsening of the illness 6 No 24-hour emergency services in the hotel 3 12-hours service 3 54 Provision of 24-hour services Management Recommended 3 3 2 18 Food service Substandard food Diseases or injuries 5 Inadequate supplier control systems 4 Random purchasing and inspection 5 100 Establish inspection procedures and methods Management Recommended 4 3 2 24 Food goes bad Disease 5 Packaging damage, raw material past shelf life 7 No control on the raw material and packaging 2 70 Regular inspection Management Recommended 4 6 1 24 What the FMEA Method Shows The Risk Priority Number (RPN) with value greater than 70 presents serious risks on both the hotel and those seeking the services. Besides, it gives recommendations and assesses their effectiveness depending on the new RPN (Great Britain, 2006, 141). The hotel needs to focus on the recommended actions as a method of reducing the identified potential risks. Pros and cons of FMEA The method involves thorough analysis that is easy to learn; uses group knowledge, and requires no special programme. It is excellent for evaluation of the designs in the early processes. However, the method is tedious, time consuming, and requires robust risk matrix (Surroop & Abhishekanand, 2013, 186). Besides, it does not efficiently handle redundancy or multiple failures, dependencies, and increasing failure rates. Fault Tree What the Fault Tree Method Shows From the analysis using the fault tree method, it is possible to identify the potential effect of different hotel failures. Besides, the method shows several activities performed by the hotel but contribute to the identified failure (Bruder & Roncalli, 2012). Such failures have great impact on hotel performance that to some extent might contribute to either declined profitability or general failure. Pros and cons of Fault Tree Method The method can identify the failures associated with certain institutional processes and explicitly defines the measures of remedying the situation. It also highlights some critical elements associated with system failures and creates a visual aid system for analyzing and managing the condition. The method provides an effective method of analyzing the activities and exposing the behaviors and interactions associated with each system (Altenbach, 2013). However, the method is tedious especially if there is extension of the tree analysis. It requires adequate skills from the analysts and difficult to apply within the system with partial success. With regard to time and effort, it is costly. Block Diagram Method What the Block Diagram Method Shows The method commences with the identification of the potential risks before establishing the major cause of the risks. Such concept helps to identify the risk before occurrences and put enforces preventive measures of the processes, machinery, and people likely to be negatively impacted by the predicament (Bruder & Roncalli, 2012). Besides, the method extensively focuses on the potential causes of the failure and recommends the preventive measure depending on the identified potential effect. Pros and cons of diagram block method The assessment of the results is substantially independent from the objectives of the processes, which makes it support the meaningful statistical analysis. The method can identify possible causes of the risks which other methods cannot considering its approach in risk analysis process (Altenbach, 2013). Besides, it does not require the expertise of a trained personnel just the knowledge of institutional processes. However, the block method does not consider the possibility of having several potential effects of failures as it deals with each at a time. The method involves series of activities, which makes it tedious and tiresome especially if the identified risk is likely to occupy a wider scope. Event tree method AND OR OR What the Fault Tree Method Shows From the analysis, the method conspicuously shows the relationship between the AND gate and OR gate. The AND indicate that the output of an event only occurs if there is an occurrence of input events while OR show that the output events can only occur if there is occurrence of one or more output (Bruder & Roncalli, 2012). Therefore, the method identifies and quantifies the possible outcomes associated with initiation of an event besides provision of an inductive approach to the reliability approach constructed through the forward logic method. Pros and cons of Fault Tree Method The method allows assessment of multiple and co-existing faults and failures and performs simultaneously with both the success and the failures. With the method, there is no anticipation of the end events and that system paths contributing the failures are identifiable and traceable to show the ineffective countermeasures (Polly, 2009, 155). Additionally, the method integrates the concept of hardware, software, human interactions, and environments. However, the method only addresses initiating event at ago which means the analysts has to identify the possible pathways. Besides, both the partial success and failures are indistinguishable using the method. The method requires practical training and experience of the analyst. Cost benefit analysis method Impacts Financial Economic Benefit Cleaner environment Saving funds meant for environmental protection Improved sanitation Improved hotel services Reduced complaints from potential customers Healthy environment Improved customer satisfaction Reduced market cost for enhancing the hotel brand image Effective and sustainable competitive advantage Improved customer loyalty Increased profitability Economic development Job creation Increased disposable income among employees Compliance with international working standards Cost Employment More wages and salaries for the employees Reduced unemployment rates Expansion of the hotel and services provision Risk of embezzlements and budget in appropriation Inflations Laws and policies Taxes collection Compliant programs What the CBA Method Shows In every business activity carried, to realize adequate benefits, there are often costs associated with such practices. From the analysis, it is clear costs and benefits have different dimensions including financial and economic impact (Bruder & Roncalli, 2012). The entire CBA process requires standardization of the project elements, criteria for measuring success, and objectives, which describes the value of the outcomes. Pros and cons of CBA method The method simplifies the complex processes, which reduces the amount of effort and time invested in establishing the potential cause of the risk. Additionally, it provides an objective way of comparing the activities as it bases the decisions on both qualitative and quantitative variables. It can assist to set the goals depending on the expected benefits associated with a project (Polly, 2009, 159). However, the method is prone to inaccuracies associated with identification and quantification of costs and benefits, increased subjectivity for both intangible variable, and inaccuracies in calculations of the Present Value could result in misleading results. Moreover, CBA might turn into the budget of a project in question. Budget allocation analysis The essence of having an effective risk analytical tool is to ensure the identification of all the potential risks likely to affect organizational performance effectively. The aim of risk analysis is to assist in reducing the impacts. However, the measure in place to achieve such aims depends on the availability of the resources. Poor identification and analysis would contribute to poor budgeting which leads to reduced scope of handling the risks, wasted efforts, and resources. Hence, budget allocation analysis is an integral component of ensuring effective implementation of the risk management practices (Surroop & Abhishekanand, 2013, 384). Before execution of the recommendations, the identified budget has to be sustainable to prevent waste of resources and failure to handle some of the identified risks. The calculated budget needs to involve both monetary and human resources. To some extent, failure to integrate all the components of the budgets might contribute to the worsening the prevailing conditions owing to the wider scope of the risk and limited resources. In such cases, it is significant to carry out the cost benefit analysis to establish the impacts of reducing the risk impacts (Bruder & Roncalli, 2012). With proper allocation of resources to every identified potential risk, there is elimination of confusions and time wastages associated with frequent financial auditing. Besides, to realize the effectiveness of the budget, it is significant to note the declined rates in risk occurrences. Comparisons of various risk analytical tools The best risk analytical tool should assist in identification of potential risk, cause, and recommend various methods of preventing risk occurrence. For example, Bowtie method offer the best tool as it allows identification of the barriers that contribute to the risk, the hazard, event, and consequences of such risks (Great Britain, 2006, 133). However, the method does not offer recommendations. On the other hand, SWOT only focuses on the internal and external organizational processes but fails to consider the coherency and interrelationships between the various processes. CBA offer the best method for projects of wider scope and likely to result in risks of greater magnitude. References Altenbach, T. J. 2013, May. A Comparison of Risk Assessment Techniques from Qualitative to Quantitative. Retrieved from http://www.osti.gov/scitech/servlets/purl/67753/ Bruder, B., & Roncalli, T. 2012, March. Managing Risk Exposures using the Risk Budgeting Approach. Retrieved from http://www.thierry-roncalli.com/download/risk-budgeting.pdf Gonzalez, D. 2014. Online Security for the Business Traveler. Burlington: Elsevier Science. Great Britain. 2006. Fire safety risk assessment: Sleeping accommodation. Wetherby: Dept. for Communities and Local Government. Pizam, A. 2005. International encyclopedia of hospitality management. Amsterdam: Elsevier Butterworth Heinemann. Polly, D. W. 2009. Sunset in Dubai Overlooking the Burj al Arab. Spine, 34(18), 150-161. Surroop, D., & Abhishekanand, A. 2013. Technical and Economic Assessment of Seawater Air Conditioning in Hotels. International Journal of Chemical Engineering and Applications, 122-145, 382-387. Read More