It’s worth thinking about what’s going to stand in the way of demand for business trips. Yes, the Covid problem is a huge barrier, but it goes beyond that. I see five related barriers that our industry will have to reckon with. Here’s the short story on my LinkedIn page: https://bit.ly/5_Barriers_to_Business_Travel New connections are welcomed.
The longer, richer read follows. Fair warning – it is a sobering assessment.
1. Virtual Work
The more that work gets done virtually, the more that virtual meetings will eliminate demand for business travel. Pre-Covid, virtual meetings were a known alternative to traveling, but a clear downgrade in terms of interpersonal impact and, frankly for some, status. Many travelers and their managers were quick to decide “It’s better if we do this meeting in person.”
Post-Covid, managers up and down the ranks are forced to use virtual collaboration tools, like ’em or not. Guess what? They work. For a lot of meetings, across a lot of use cases, and for an awful lot of people. Today, managers are building up a comfort level with virtual work, and that means trouble for travel.
If employees don’t have to go to an office to get their work done, why would they need to travel to get their work done?
I fear this incredibly wide adoption of virtual work will by itself permanently eliminate a layer of business travel. I’ll go further, and predict that the next generation of virtual collaboration tools will be designed specifically to eliminate the need for in-person conferences and conventions. Think LinkedIn + Slack + Slido + Match + Zoom + Udemy + Siri. Ouch.
2. Covid Anxiety
This is the biggie. It’s far more than case counts, mortality rates and the promise of a vaccine. It is the business traveler’s sentiment, his state of mind – his attitude, fears, doubts; her concerns for her own health and her family’s; his willingness to trust that long chain of a trip’s touch points and shared air – all those risks and reasons to say “no thanks, I’ll not travel yet” balanced against the rewards of what – winning a sale? Motivating the troops? Leading a brainstorming session?
The Covid anxiety barrier goes well beyond traveler sentiment. It includes executive sentiment and government posture. When and under what circumstances will a business leadership team authorize, and yes, eventually require a return to business travel?
Those clever folks at Festive Road have developed the Permissible Travel Framework, a very thoughtful tool for helping companies put their travel program back on sound footing.
Max Habeck has led hundreds of road warriors at several major consulting firms. His idea? A traveler’s charter. A set of guiding principles for deciding why and how to travel with “minimum guidance from above”, notably not a “policy”. I love it.
And for all my friends in Europe, government posture is clearly a huge factor. Let’s agree that short haul domestic travel will rebound faster than long haul international. Unfortunately, you’re now facing cross-border short haul travel restrictions that drastically shrink the scope of easy border-less travel.
On what basis will each government reduce its own Covid anxiety to the point of allowing reasonably free cross-border travel?
There’s one more important stakeholder with significant Covid anxiety to worry about. It is the traveler’s host, the party with whom the traveler is hoping to meet. Even if the traveler, her manager and her government are all good with her traveling, that doesn’t mean her host is, does it? No. The host is a key player in this equation of recovering demand for business trips.
I suspect in-bound travelers will be treated the same as any other in-bound visitor by most companies, so no travel stigma per se upon check-in. Unfortunately, there will be hidden barriers raised by Covid-anxious hosts in the form of “Say, let’s do this meeting by Zoom instead, OK?” How in the world is a business traveler expected to overcome that objection? Do not underestimate this element of the travel recovery equation.
3. Wasted Time, Lost Productivity
Let’s assume our traveler has green lights from all the stakeholders and wants to get back in the air. What’s the next barrier to business travel demand? The expectation of a miserable travel experience, through no fault of any travel supplier.
This assumes that social distancing is widely accepted as a norm, an important expectation, whether required or not. If so, then its hard to see anything other than lines – long lines – at every point in the journey. Longer traffic lines to get into the airport, longer lines to check in, to get through security, to board and again to exit a plane or train or bus or elevator, to check into a hotel, to wait for a taxi or subway.
My god, how travelers will despise this wasted time, and their managers will despise their lost productivity.
Think about what this means for those business travelers willing to put up with these longer lines. Instead of getting up at 5am to catch an 8am flight, she now has to get up at what – 3am? And get home at 11pm, rather than 8 or 9pm? No more day trips, so more nights away from home? Yeesh.
4. Higher Prices
Again, this barrier assumes social distancing is the norm, like it or not, effective or not. So long as people are spaced farther apart in airplanes, hotels and restaurants, then it’s easy to predict higher prices. Why, in light of the very low demand for travel across the board? Because travel suppliers have only so much room to reduce their fixed costs. This means higher fixed costs for the remaining passengers, guests and diners.
Unfortunately, there will be new extra costs for all travel suppliers in the form of extra health and hygiene protocols. More labor, training and certification, not to mention lower utilization of planes, hotel rooms and car fleets while those assets are cleaned more thoroughly.
Variable costs will be higher as will fixed costs per remaining traveler/guest/driver/diner. So there it is…higher prices for those who still choose to travel.
5. Fewer Benefits
Put yourself in the travel budget owner’s shoes – the guy or gal who has to authorize one of these new, less productive and higher-priced trips. Do you spend the money and your traveler’s valuable time, or not? As always, it’s about the payback, the expected ROI from the trip.
These trips will cost more and be less productive, so that means fewer trips will be justified. Those that were at the pre-Covid margin of an acceptable ROI won’t survive the current payback test.
Again, let’s assume social distancing is the norm, as is the expectation that face-to-face meetings require masks. A good chunk of business travel is done in order to meet, literally, face to face. If everyone in the meeting is wearing masks and sitting six feet apart, you can be sure it will be harder to build relationships, read a room, or find your negotiating opponent’s tell.
Budget owners will learn to factor this extra barrier into their payback expectations. As they do, another layer of at-the-margin business trip requests will be denied.
The Next Normal?
Far fewer business trips will survive this gauntlet of barriers. It’s hard to see how business travel volumes will recover to anything close to the old normal levels anytime soon. So what must be done to see the business travel industry recover?
Clearly the Covid problem needs a wide-spread set of solutions, ones that greatly reduce today’s levels of Covid anxiety across all the travel stakeholders. Let’s assume that these include a variety of health and hygiene protocols, and that they endure well past the fade-out of the Covid disease’s prevalance.
Of the remaining barriers, we must assume virtual meetings will take some share from the business travel industry. I’d accept this for now and move on.
The real key, the thing this industry can and must tackle, is traveler productivity. Or better, traveler success. More thoughts on this soon.