Pre-Disaster Risk Management in Post-Earthquake (1999) Turkey

This paper assesses the status of pre-disaster risk management in the case of Turkey. By focusing on the period following the catastrophic August 17, 1999 earthquake, the study benefits from USAID’s Disaster Risk Management Benchmarking Tool (DRMBT). In line with the benchmarking tool, the paper covers key developments in the four components of pre-disaster risk management, namely: risk identification, risk mitigation, risk transfer and disaster preparedness. In the end, it will present three major conclusions: (i) Although post-1999 Turkey has made some important progress in the pre-disaster phase of DRM, particularly with the enactment of obligatory earthquake insurance and tightened standards for building construction, the country is far away from substantial levels of success in DRM. (ii) In recent years, local governments have had been given more authority in the realm of DRM, however, Turkey’s approach to DRM is still predominantly centralized at the expense of successful DRM practices at the local level. (iii) While the devastating 1999 earthquake has resulted in advances in the pre-disaster components of DRM; progress has been mostly in the realm of earthquakes. Turkey’s other major disasters (landslides, floods, wild fires i.e.) also require similar attention by local and central authorities.

Protecting Your Assets: A Well-Defined Credit Policy Is The Key

In - Protecting Your Assets: A Well-Defined Credit Policy Is The Key – an essay by Steven V. Moll, Associate Professor, The School of Hospitality Management at Florida International University, Professor Moll observes at the outset: “Bad debts as a percentage of credit sales have climbed to record levels in the industry. The author offers suggestions on protecting assets and working with the law to better manage the business.” “Because of the nature of the hospitality industry and its traditional liberal credit policies, especially in hotels, bad debts as a percentage of credit sales have climbed to record levels,” our author says. “In 1977, hotels showing a net income maintained an average accounts receivable ratio to total sales of 3.4 percent. In 1983, the accounts receivable ratio to total sales increased to 4.1 percent in hotels showing a net income and 4.4 percent in hotels showing a net loss,” he further cites. As the professor implies, there are ways to mitigate the losses from bad credit or difficult to collect credit sales. In this article Professor Moll offers suggestions on how to do that. Moll would suggest that hotels and food & beverage operations initially tighten their credit extension policies, and on the following side, be more aggressive in their collection-of-debt pursuits. There is balance to consider here and bad credit in and of itself as a negative element is not the only reflection the profit/loss mirror would offer. “Credit managers must know what terms to offer in order to compete and afford the highest profit margin allowable,” Moll says. “They must know the risk involved with each guest account and be extremely alert to the rights and wrongs of good credit management,” he advocates. A sound profit policy can be the result of some marginal and additional credit risk on the part of the operation manager. “Reality has shown that high profits, not small credit losses, are the real indicator of good credit management,” the author reveals. “A low bad debt history may indicate that an establishment has an overly conservative credit management policy and is sacrificing potential sales and profits by turning away marginal accounts,” Moll would have you believe, and the science suggests there is no reason not to. Professor Moll does provide a fairly comprehensive list to illustrate when a manager would want to adopt a conservative credit policy. In the final analysis the design is to implement a policy which weighs an acceptable amount of credit risk against a potential profit ratio. In closing, Professor Moll does offer some collection strategies for loose credit accounts, with reference to computer and attorney participation, and brings cash and cash discounts into the discussion as well. Additionally, there is some very useful information about what debt collectors – can’t – do!