Will the travellers come back?
In his thoughtful comment piece, posted on the ABTN website today (September 3), Paul Tilstone addresses what he calls the "core issue" facing the business travel industry: "what role will travel play in the future in driving business goals?"
Mr Tilstone, chief executive of the UK and Ireland Institute of Travel and Meetings (ITM) said this was the topic which kept coming up every time he spoke with delegates at last week's NBTA Convention.
Paul Tilstone: posing the crucial question
There is no doubt that the recession has had a major impact on business travel. Some believe that the number of air passengers will not return to the boom levels of 18 months ago. This school, which includes Willie Walsh, BA's ceo, believes that not only will passenger numbers be down, but that, more crucially to airlines like the UK carrier, premium traffic will also not rise back up to i,ts early 2008 numbers.
Others take a more optimistic view that when the likes of bankers, lawyers and consultant return to travel, they will head for the front not the back of the plane. There is some reason to believe this as it is hard to imagine this lot, earning many hundreds of pounds an hour, travelling coach.
More interesting from the point of view of both opinions, is whether the c-level executives of other, less high earning companies, choose economy or premium. That is, as yet, an unknown but two pointers suggest they will go business class, at least for long haul. First, the firm offering premium travel is better placed to recruit and secondly, there is the corporate duty of care. It is not a good strategy to expect executives to perform at the top of their game after eight hours in economy.
But this is not the question that Mr Tilstone is rightly posing. The answer as to whether people will travel as much when the recovery comes is complicated by three factors: improved technology, the current trend to measure the ROI of a trip and the environment.
Substantial improvements in technology have made video conferencing, webinars and telepresence viable alternatives to actual travel, to mention just a few. There is obviously an initial outlay for equipment but many firms have found that this is repaid through savings on travel bills. Firms have also particularly sought to use video conferencing or the other options for meetings which are purely internal.
People still prefer to meet in person as the survey by BA in America, published last week, found. 95% of respondents said face to face meetings were the key to successful business relationships.
This moves smoothly onto the ROI of a meeting and how you measure it. In cases it is a black and white issue: a trip to sign a multi-million pound deal must be face to face; an internal meeting of mid to low ranking managers can probably be done through video conferencing. The problem is that the vast majority of trips are of varying shades of grey, trips that might yield results, that might build up long term relationships where the ROI is much harder to judge.
Sam Gilliland: against cutting flights
Decisions on whether to travel coach or premium, to travel or to use an alternative are all based on commercial considerations. The difference with the third factor, the environment, is that it brings a new dimension to the equation: the moral consideration. The question becomes not ‘will people return to travel?' but ‘should they?'
Many believe that in the interests of combating climate change and quite possibly catastrophic affects on the earth, people, individuals as well as firms, should be looking to cut their carbon footprint. Aviation, although its worldwide contribution to CO2 emissions is currently extremely low, has been a prime target. One of the reasons for this is that if air travel continues to grow at its current rate, its level of emission will outstrip other industries by about 2050.
Leilani Latimer: seeking a wider approach
The World Wildlife Fund UK (WWF) launched its One in Five Challenge in July to persuade corporates to cut their business flights by 20% by 2014. Much of the opposition to a third runway at London Heathrow is based on green arguments. Others have argued that merely cutting flights is not the way forward or that cutting carbon emissions should be just part of a wider policy which should include using less energy and water.
(For a fuller look at these views, please see the ABTN Comment by Sam Gilliland, chairman and ceo of Sabre Holdings and the ABTN interview with Leilani Latimer, Sabre's director for sustainability).
It is idle to think that corporate will jeopardise their commercial operations by wantonly cutting flights. But there are ways forward. Some flights and also car journeys - a high source of CO2 emissions - could be swapped for train journeys. Cleaner, quieter planes will also help counter the demand for major cuts in flying.
But the question ‘Should people return to the same level of travel?' remains a valid one. Business travel, like all industries, should take into account the impact its activities have on the environment.