Managing the COVID-19 Crisis in the Hotel Industry: An Asian Perspective

Abstract: Before the pandemic, Asia was the second most visited world region, attracting 360 million tourists (25% of all international arrivals) (UNWTO, n.d.). However, the COVID-19 pandemic has put this region’s tourism and hotel industry at risk (Baum & Hai, 2020). Namely, in 2019 international arrivals decreased by as low as 95% (UNWTO, n.d.), and hotel organisations were forced to shut down due to severe staff shortages and occupancy issues (Hidalgo et al., 2022). Ongoing lockdown situations in China question the ability of the hotel industry in this region to bounce back to the pre-pandemic performance levels. Researchers and industry experts argue that a more nuanced understanding of the industry’s capabilities before the pandemic is needed to identify an effective recovery strategy and plan these capabilities for future events (Liu & Yang, 2021). Additionally, the crisis management perspectives are thought to be useful in exploring the industry’s pre-, during and post-pandemic capabilities and figuring out future narratives (Le & Phi, 2021). Particularly, it can highlight within-the-region experiences with the pandemic and lessons learned by countries from within the region and beyond.
Drawing on the qualitative data in the form of semi-structured interviews with industry experts from the Asia region, we explore the following research question: What are the key hotel industry capabilities driving through the crisis, such as COVID-19 pandemic?
Crisis management literature in the tourism and hotel industry considers man-made events (Walters et al., 2019) and natural disaster management (U & So, 2020). Three key stages are usually distinguished: pre-crisis, during crisis, and post-crisis (Ritchie, 2004). The pre-crisis phase focuses on the evaluation and availability of industry capabilities and relevant response strategies. The ‘during-crisis’ phase focuses on emergency and contingency management (Sawalha et al., 2013). This phase also highlights the importance of outer resources and support, including government support packages (Barbe & Pennington-Gray, 2018), practices of automation and revenue diversification (Dayour et al., 2020; Lai & Wong, 2020; Le & Phi, 2021). Post-crisis phase focuses on learning from past crises and preparedness for future crises (Le & Phi, 2021). The pre-crisis phase and hotel industry capabilities received limited research attention, considering the unprecedented character of COVID-19. However, analysing and identifying relevant capabilities are essential as they enable communication, coordination and synergy between the three phases of crisis management (Sellnow & Seeger, 2013).
The study adopts a purposive sampling method and analyses the largest hotel chain organisation operating globally. Overall, we approached ten hotels as part of this chain in Asia: India, Nepal, UAE and China. We ran semi-structured interviews with mid- and senior-level managers from these hotels. The data collection ran between April-June, 2022. These interviews lasted one hour and were conducted online using MS Teams or zoom. We cross-reviewed and cross-analysed the interview transcriptions and codes using NVivo 20 software.
The findings reflect the three phases of crisis management. In respect of the pre-crisis phase, study participants referred to effective communication as a key organisational capability for workforce management during COVID-19. They also reported that existing technological applications such as QR codes, self-check-in and automated keys were essential. However, they thought that staff needed more training and development before the pandemic to use these technologies during the pandemic.
In respect of the during-crisis phase, study participants from India, UAE and Nepal reported issues with crisis management planning and practices of staff lay-offs as a key outcome. Somewhat different insights were expressed by General Managers from China. Namely, they referred to centralised government as an important industry capability during the pandemic. At the rise of the pandemic, the Chinese government issued a directive prohibiting organisations from staff dismissals unless employees submitted a leave intention. Dismissal avoidance during the pandemic facilitated the post-crisis recovery in China, namely, hotel organisations avoided issues with staff shortage or low motivation to work in the hotel industry, as witnessed by other countries such as India, UAE and Nepal.
In respect of the post-crisis phase, managers across all nations highlighted the importance of wellbeing and support for staff, as an important organisational capability for future crises. For example, Indian managers referred to practices of health auditors and health promotion for staff and their families. Other examples include surprise gifts and free food for staff (Nepal), practices of emotional intelligence and coaching (China), practices of wellness chats and availability of doctors on call (UAE).
Important implications for crisis management and post-pandemic hotel industry development will be discussed accordingly.