The black swan that refuses to go away
In his book ‘The Black Swan: The Impact of the Highly Improbable’, Professor Nassim Nicholas Taleb defines the ‘black swan’ event as a high impact, low probability event with certain pre-conditions: it’s unpredictable and rare beyond what is normally expected in a situation, and it has potentially severe consequences.
Events such as this pandemic which are very rare and globally rampant are referred to as “black swan” events. Because they rarely happen, black swan events are near impossible to prepare for…let alone anticipate. They tear-apart or destroy ‘normal’ life and pose incredible challenges to recovery due to the ferocity of the ‘unpredictability’ they create.
“Probably by the end of this winter, as is sometimes cynically said, pretty much everyone in Germany will be vaccinated, recovered or dead,” said the German health minister very recently. This no doubt is a huge stretch of someone’s imagination. Not because it will not happen, and not just in Germany… but should that ever happen, it wouldn’t be before March 2022. But then, who can predict what’s going to happen or not?
What is predictable though on the hospitality front is that the next several months will remain unpredictable, particularly with Europe in the throes of another wave from the pandemic. The World Health Organisation (WHO), has predicted that there can be a further 700,000 deaths in Europe during this winter period - pushing that continent’s total count to 2.2 million deaths by April next year.
In such a scenario, full or partial lockdowns including border closures could once again occur resulting in flights getting cancelled overnight - where traveling becomes a game of Russian roulette. For example, ongoing uncertainty between New Zealand and Australia compelled Air New Zealand to cancel over 1000 flights between the two countries between 23rd November and 31st December, 2021 - a move that affected around 20,000 customers.
The path to recovery is far from clear. So, how can hospitality organisations which rely on forecasting plan for the future? They need to know how and when travelers are likely to return. One thing is for sure; people do have a strong urge to travel to overcome the depression associated with pandemic fatigue.
Usually, when facing a serious downturn in business, one looks to the past for guidelines and to base forecasts on historical data before taking decisions on everything from hiring to sales to budgeting. However, this traditional methodology is of no use when dealing with an event of unimaginable magnitude – such as this COVID-19 ‘black swan’
The term Black Swan originates from the belief that all swans are white because these were the only ones accounted for. Likewise, businesses including those in hospitality have dealt only with ‘white swan’ events that posed typical risk management challenges. The time has come to shift that emphasis to dealing with the consequences of ‘black swan’ events, and, that requires switching from preparing for the unexpected, to thinking the unthinkable.
Get a ‘black swan” drill in place because that is going to be a part of the new normal.
Shafeek Wahab – Editor, Hospitality Sri Lanka, Consultant, Trainer, Ex-Hotelier
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