Tuesday, 16 April 2013

Does Terrorism Threaten Hallmark Events?

All of us in the event business have become acutely aware of the importance of risk management over the last twelve years. The Boston Marathon bombings have just raised that awareness to a new level.

Whether it was political terrorism, whether it was a disgruntled runner who did not qualify, whether it was home-grown, or whether it was externally-grown does not matter. What matters is that it happened at a public special event. That event was what we might call a "hallmark" event. It and its larger cousins, "mega" events, often attract large numbers of participants and spectators from a host nation and from other nations. These types of events can bring in a lot of money to the host city. They can also become prime targets at which those with a cause can make a public statement. What will happen to such events from now on?

First, as with 9/11, the requirement for even more thorough risk assessment and management will increase. Invariably, this will mean increased policing, more barriers and screenings for spectators and participants, more detailed accreditation, more delays for traffic and transportation, higher fees for all involved, etc, etc. This begs the question, "When does the cost of this increased protection become too high?" It's a hard question to answer, because it means that event organizers have to balance their decision on whether to continue hosting such events based on their perceived return on investment on the one hand with the negative publicity of "giving up" and "letting the bad guys win" on the other.

Let's look at this decision, though, taking Boston as the example. No doubt the Boston Convention and Visitors Bureau has statistics on hand which indicate the value of the marathon in bringing tourist dollars (external dollars) into the city. Unlike the Olympics, it is my guess that the marathon does not cause many visiting runners or spectators to re-visit Boston at a later time. Nor does it cause large numbers of tourists from around the world to flock to Boston because they have seen it on TV or seen accompanying tourist ads. Unlike the larger Olympics, I am guessing that Boston does not see increased tourism or convention traffic because of the marathon. The only money they see comes from participants and their entourages. In other words, it is a one-time event each year.

Thus, with the increased security they will have to pay for next year, will there be any ROI? If not, and if those expenses are now deemed too high, what happens to the various charities that benefit from the runners' participation? Even more importantly, will runners around the world and Americans in general, be more inclined to force the marathon to continue rather then admitting defeat to the "bad guys?" Why is it necessarily wrong to admit this? If it is, how much risk can they live with and what are the chances that "lightning might strike twice?" Who would be crazy enough to try to bomb the marathon a second time? The answer is all part of the risk assessment.

We have to keep in mind that the total elimination of all risk is still an impossibility.