Managerial Decision-Making in the Sphere of Tourism Under the Conditions of Risk and Uncertainty

Abstract

AbstractThe present paper addresses the justification of the technique of strategic managerial decision-making in tourism industry, which is currently characterized by a high level of risk and uncertainty amidst the COVID-19 pandemic. The authors of the paper would like to identify effective strategies for the development of tourism industry on the example of Russia and the Republic of Armenia. The paper considers four possible strategies for tourism recovery based on expert assessments of the probability of restoration of the pre-pandemic situation in the field of inbound and domestic tourism over the medium term. The strategies included developing tourism clusters and destination management organizations, starting the Ministry of Tourism, preserving the current policy of tourism development. The research uses probabilistic and mathematical decision-making methods based on extrapolation, and provides a solution matrix of possible strategies to stimulate tourism in the post-pandemic period in Russia and Armenia. According to experts, the tourism industry is most likely to recover by 60% over the next 5 years compared to 2019. Wald, Savage, Hurwitz and Laplace criteria were used to evaluate the strategies for a long-term strategy development. The findings suggest that the cluster strategy in the tourism sector will be most effective for Armenia. In the tourism industry of Russia, it is recommended developing the current regulatory system and policy; however, the clustering strategy is also effective, as its implementation risk is low.KeywordsTourism industryDevelopment strategiesExternal environmentRisk and uncertainty factorsDecision-making models