Here we explore and calculate the risk management of developing Kampung Batik Kauman as a destination icon for Pekalongan City, all risk calculated thru typology of risk by Michel Crouhy. happy reading

1. RISK MANAGEMENT
IN DEVELOPING
KAMPUNG WISATA BATIK KAUMAN
PEKALONGAN CITY

2. “Kampung Kauman is the oldest area of batik center in Pekalongan, even in Indonesia, ..
since the 1950s there have been several batik industries in Kauman. And in 2007, the
Mayor of Pekalongan inaugurated this area as Kampung Batik .. and the total number
batik industries in Kauman reach over 50 stores. Most are home industries”
(Kontan.co.id, 2013)

3. Tourist attractions:
More than 50 shops and showrooms – over 14 local Batik Industries – 27 Historical
Buildings – 10 Homestays available for visitors – Traditional cultures – IPAL (waste
management installation) – Old Mosque Al Jamie’ Kauman – Local hospitalities.

4. Tourism development that promotes:
1. Socio-cultural development
2. Environmental protection
3. Economic sustainability
Sustainable tourism
Economy
Environment
Society
Dr. Stefanos Fotiou, United Nations Environment Programme

5. Typology
Of Risk
Market
Risk
Credit
Risk
Liquidity
Risk
Operatio
nal RiskLegal &
Regulator
y
Risk
Business
Risk
Strategic
Risk
Reputatio
n Risk
Not Popular
among
Domestic &
International
Booking with no
prepayment &
cancellation
Funding
management
from self funding,
govt and private
Low service
standard and
poor organization
managementCommunity
organization with
strong individual
preference
Sustaining visitors
arrival
Product
differentiation;
communication
and promotion
Coordination
among
staleholders and
low service/
expectation

6. STEP 1. RISK
IDETIFICATION
(WHAT MAY
HAPPEN)
STEP 2.
MEASURE &
ESTIMASTE THE RISK
ANY INSTRUMENT
REDUCING THE RISK
STEP 3.
ASSEST THE IMPACT
AND THE RISK
COST & ADVANTAGES
STEP 4.
CREATE MITIGATION
STRATEGY
STEP 5.
EVALUATIONS
COMMUNICATE
CONSULT
DOCUMENT
MONITOR
REVIEW
(Yetta Gurtner and Damian Morgan - Risk Management for Small Tourism Business, 2004)

7. Risk Typology Kampung Kauman Likehood Consecuence Risk Level
High domestic tourist market, low promotion and branding.
Hard to get international tourist but potential thru promotion
Batik is popular and Pekalongan is known for Batik. Promoting Kp Kauman in every international or national Batix fashion show or expo
Cash and advance payment after reservation Reservation are confirmed after receiving advance payment
Cancellation may happen Cancellation fee applicable to delayor cancelled visitors
Order and reserve by confirmed booking No purchase of preparation withour reservation (confirmed)
Development thru self funding and government or private
donation without any obligation.
Each sector work on each member may have different standard
As a New organization may not work as expected Target, evaluation and monitor achievements of the organization activities
The organization is extra (additional) job without payment Share profit as incentive thru organization and each perosn involved
Community based organization as made thru local community
with local government support
Strong individual preference against organization goals
Secure interaction (criminal action) during visitors' stay
Sustaining number of visitor (continous tourist coming)
New destination need to create a market need
Potential competiting among members of the organization
Differentiation among similar destination (Kp. Pesindon, Solo,
Jogya, Semarang and Tegal)
Active communication thru agency/ tour operator and media
(promotion)
Promoting destination thru local people and local tourist
(Pekalongan's tourist)
Unable to serve the tourist as expected
Coordination in managing and handling visitors
Over paid (over valued compare to other destinations)
Remarks: Low Small Low Rare No Impact acceptable
Moderate Moderate Medium My Happen No direct impact (minor) can be accpted but monitor
High Severe High Quite Ofter Large Loss Not accepteble
Very High Catastrophic Very High Very Often Serouose permanent loss Immediate action for low risk reduction
Create active promotion and agreement thru visitors centers, visitors arrivals and
hotels and malls in Pekalongan and beyond.
Always make sure that the price published meet the market price and demand by
doing price/cost maping and tours spending index.
Continues training and evaluation
Risk Typology & Mitigation Kampung Batik Kauman
Create training and communication among operators in Kauman and aware of
potential criminal action
Create sustainable potential visitors (monthly) and capablity to secure the visitors
arrival (sales dept.)
Active marketing and promotion thru traditional channel and thru millenial fave
funnels
Regula discussion and communication each sectors in how to improve service and
support each other
Create potential and unique attractions with continues improvement of service
standard
Sales department and PR should active communicate and promote thru travel
agency/ tour operator in major cities iin Java.
Strategic Risk
Reputation Risk
Always have discussion for pre and post touris arrival (groups) for better service.
Open mind to any positive critics and suggestions.
Mitigation
High promotion and branding thru media in potential market (Jakarta, Semarang,
Bandung and Surabaya)
Introduction and join international expo thru Indonesian embassy and inbound tour
operator
Active for fundrising to government and private institution for facility support
funding
Legal and formal local tourism organization involving local government, private
businessman and local leaders as stakeholders
Person incharge have to get some creteria in developing Kauman tourism with low
personal interest
Market Risk
Credit Risk
Liquidity Risk
Operational Risk
Legal & Regulatory
Risk
Business Risk

8. Calculating risk management in developing a destination for Kampung Batik Kauman is a
mechanism to control the performance and impact and how to anticipate consequences
and negative impacts of the development Kampung Batik Kauman, and can reduce the
potential for loss (failure) by reducing the probability of loss and damage. Risk
management activities in Kampung Batik Kauman should not be viewed as a cost or
expenses, but as an investment to stabilize and ensure the success of developing Kampung
Batik Kauman as a tourist destination.

9. Widodo Heru
Retail Business Professional, Branding and Channel Marketing
Hospitality and Destinations Enthusiasm
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