‘This Could Have Been a Zoom Meeting:’ Companies Rethink Travel
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David Calhoun, CEO of Boeing, has access to the company’s planes as part of his job. Despite this, he told an interviewer he didn’t expect to steal so much for internal company meetings after the pandemic.
Mr. Calhoun, like some of his peers, found that video calls were remarkably effective at recording with colleagues, allowing him to organize more meetings and schedule them with minimal notice, according to a report in ” Leading at a Distance ”, a recent book by James M. Citrin and Darleen DeRosa.
“I will be doing the same or more trips with clients, as it is still the most important way to build relationships,” Calhoun told the authors. “But most of the trips when you’re running large companies visit your own teams. I won’t do it as much.
There is a broad consensus that how often we fly to work and what we travel for will change dramatically after the pandemic. Who travels can also be different. This, in turn, will lead to changes in what the travel industry provides to businessmen, a source of nearly a third of its revenue before the pandemic.
A year and a half spent giving up virtually all travel and doing business by videoconference has led many businessmen to conclude that much of their previous trips were not worth it and were not. Valued to their body and mental state, to their family and to the environment. This is before even considering the role that travel has played in transmitting the virus across continents.
There is a popular meme: “This meeting could have been an email.” Those of us who have traveled long distances for a single business meeting know that we might as well often say, “This business trip could have been a Zoom call.
And before travel fully resumes, some organizations and individuals are taking steps to bring it under control. The commitments made by many companies to reduce their emissions add significantly to the pressure, goals that often involve reducing the carbon footprint of employee business travel. .
One scenario is that suggested by Mr. Calhoun: Companies could dramatically reduce entire categories of travel, such as in-person meetings with internal colleagues in other cities. A Wall Street Journal analysis last year, for example, estimated that in-company meetings and training made up 20 percent of all business travel and predicted that 40 to 60 percent of that would disappear. definitively. The Journal concluded that 19 to 36 percent of business travel would disappear. Bill Gates predicted at the DealBook conference last fall that business travel would still be over 50% lower once things normalized.
Unlike domestic leisure travel, which has largely recovered, business travel has been relatively slow to return. According to a recent survey by the Association of International Certified Professional Accountants, only 9% of companies report having resumed their pre-pandemic travel levels. United Airlines and Delta Air Lines both recently said business travel remains around 60% below pre-pandemic levels, despite an increase in recent months. The increase in coronavirus cases in recent weeks could further delay the resumption of business travel.
But Mr. Calhoun’s plan to reduce his own internal travel echoes the results of the accountants association survey, which found that two-thirds of companies allow travel for sales or meetings with clients. , and less allowing travel for internal purposes or training programs.
Early indications suggest that most businesses will be reluctant to significantly reduce the estimated two-thirds of business travel that involves sales calls and client visits, conferences, and professional services like consulting. Executives are always worried about losing to a rival who shows up in person or seeing an important contract go missing due to poor virtual communications. Jamie Dimon, managing director of JPMorgan Chase, said in May that clients told him his bank lost business when “other guys’ bankers visited him, and not ours.”
United chief executive Scott Kirby earlier this year predicted “a complete recovery in business demand as business travel is all about relationships.” Speaking to investors via a conference call, he added, “You can’t build human relationships through a medium like this.”
Daily business briefing
Others also see the potential for increased business travel, as increasingly dispersed workers have to congregate regularly.
“What we describe as business travel could actually expand in the years to come,” said Lindsay Nelson, experience and brand manager at Tripadvisor, the online travel company. “But the kind of people who travel and what they travel for is going to change.”
Ms Nelson predicted that remote working arrangements will mean more employees will return to their offices. So, rather than a subset of elite employees constantly flying away from a head office, a larger percentage of workers will go to the head office or offsite meeting places to meet.
Such a change could cause hotels and airlines to rethink their loyalty programs, which typically cater to the frequent flyer warrior of the road, to attract the activity of regular, but less frequent travelers. Ms Nelson said these travelers might seek different benefits, such as an extension of the flexible flight cancellation terms that prevailed during the pandemic. Another trend the industry could respond to is that nearly 90% of business travelers surveyed by SAP Concur recently said they plan to combine personal vacations with their business trips next year.
But rather than simply accepting that business travel is rebounding, companies can use last year’s change in practices to open a new chapter in how they approach it. A compelling reason to do so is the environmental impact, especially as organizations seek to reduce their climate footprint.
Commercial air travel is responsible for about 3 to 4 percent of total greenhouse gas emissions in the United States. First class travel, due to the lower density of seats, can result in up to four times more emissions than sitting in the back of the plane.
At Zurich-based reinsurance company Swiss Re, for example, thefts accounted for around two-thirds of its operational carbon footprint. As part of its net-zero emissions efforts, the company took advantage of declining business travel last year to more permanently reduce its carbon footprint. Air travel by its employees has fallen by about 80% from 2018 levels last year, and it expects a 30% or more drop from the 2018 benchmark this year.
Swiss Re began adding a significant carbon surcharge on flights purchased by its 13,200 employees in January, which is roughly $ 500 on top of the price of a plane ticket from Zurich to New York. Team budgets can absorb these charges – which Swiss Re uses to finance carbon offsets and elimination – since its employees steal less.
But as travel returns and surcharges weigh on budgets, the goal is to force employees to think harder when booking travel about whether it’s really necessary.
“We still have to travel to meet clients, but maybe not as often,” said Mischa Repmann, senior environmental management specialist at Swiss Re. “We can merge trips, we can travel more mindfully than in the past. “
Other companies are moving in the same direction. Salesforce announced in April that it plans to reduce its own carbon emissions from business travel by 50% relative to its revenue from 2019 levels. business per employee by 50% by 2030. EY’s goal is to reduce business travel emissions by 35% between fiscal 2019 and 2025.
In addition to reducing the number of flights, companies are using calculators to determine the least polluting locations for meetings, such as those some attendees can reach by train. And some are experimenting with “cluster meetings,” where participants meet at nearby hubs and virtually connect with those from other regional clusters.
Environmentalist and author Paul Hawken calls traveling long distances for business meetings “a catastrophically monumental waste of resources” and argues that businesses would do better with less business travel. “We just got a good lesson on how to be efficient without moving the protoplasm,” he said.
It would be easy for organizations to revert to their old practices, and probably many will. But their environmental goals will cause some companies to rethink who travels and why. And if we are well aware of the limits of videoconferencing, there are compelling reasons to forgo certain trips and to resign ourselves to settling on Zoom.
Mr. Delaney is co-founder and editor-in-chief of charter, a media and service company focused on transforming workplaces.
What do you think? Should companies indefinitely reduce their business trips? How? ‘Or’ What? Let us know: [email protected] clock.com.
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