Kevin Mitchell expounds on the communications-technology value proposition...
The 17 January 2012 Air & Business Travel News Feature "Business travel is not under 'significant threat' - Amadeus," is an excellently written piece based on a well-researched report. There are additional historical and technology-use considerations to add to the analysis when viewing the long-term impacts of new communications technologies on business travel activities.
When the telegraph lines were laid along side the rail tracks the pundits of the day predicted the demise of business travel by rail. However, business travel by rail increased with a head of steam never seen before. Similarly, connected networks of long-distance telephone service providers were to be the end of jet travel. Instead, jet travel took off well beyond all expectations. It would appear that when new communications technologies emerge and meet up with existing transportation services there can be a boom in commercial activities and business travel demand.
Video conferencing, and in more recent years telepresencing, has become better, cheaper and ubiquitous, tremendously increasing its network value. For some 20 years this technology has helped reduce some kinds of business travel. However, there are two fundamental realities that will likely continue to drive business travel demand, in BTC’s view.
First, as the world’s population grows, and economies modernize, there will be an absolute increase in commercial activity and the corresponding number of potential business travelers. Second, beginning with email decades ago, and various forms social media more recently (e.g., LinkedIn), business people now maintain orders-of-magnitude more relationships, which eventually leads to a relative increase in the need to meet face to face.
Another important consideration is how new technologies can increase individual productivity and organizational effectiveness. Two examples illustrate this point.
Example 1. A healthcare provider’s corporate customer in Madrid is unhappy with service provided to its employees. The London-based healthcare company in the past would have dispatched a team of managers to assess the situation, fix the problems and endeavor to make the customer happy. Today, communications technologies can help initially diagnose the problems. Then a smaller team can fly to Madrid to meet with the customer. Finally, the healthcare provider’s business unit president can videoconference in to a Madrid meeting where her managers are participating and make the service-improvement commitments necessary to satisfy the customer’s senior leaders and keep the business.
Example 2. The green lights of an economic rebound are on the horizon. One automobile manufacturer dispatches its sales people every Sunday night to prevent competitors from enjoying an advantage of face time with prospective customers. A competing auto company organizes its sales activities differently. Sales teams do company and product updates and new product introductions using webinars and video telepresencing during the first half of the month. These sales executives maintain existing relationships online and pre qualify prospects so that when they do travel during the second half of the month their sales production is optimized. Importantly, they get to spend some Sundays with their families. This approach can remove cost, speed the sales cycle and increase the top line.
A strong argument can be made that today’s new and emerging technologies are far and away more robust on a relative basis that any historical communications-technology innovations. There are countless ways these new tools can help businesses reduce costs, increase profitability and improve travelers’ lives without negatively impacting business travel demand and the global travel industry infrastructure that supports it.