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In 2020, the world saw the downfall of one of the biggest industries. The industry generated $1.4 trillion in 2018 and was expected to grow $1.6 trillion in annual spend by 2020.
However, the pandemic collapsed all the estimates and brought this industry down to its knees. The credit goes to governments’ strict restrictions regarding SOPs.
Yes, we are talking about business travel.
However, necessity is the mother of invention. Businesses- that were first hesitant towards remote work and virtual meetings, ended up digitalizing their whole work process during the pandemic’s intense wave.
Now, when the pandemic intensity has gone down, offices started to operate 9-5 and hybrid events got a buzz worldwide, one of the interesting questions arises:
“What will be the future of Business and Incentive Travel in The Age of Hybrid Events?”
Well, the answer isn’t as simple as “2+2 = 4.”
For the best analysis, we need to explore both sides of the picture – the benefits and drawbacks of “no business travel.” Let’s explore:
Benefits of Virtual Meetings & No Business Travel
The business professionals observed these benefits of no business travel primarily.
- Work-Life Balance
Amidst the travel restrictions, executives handled their business meetings through online platforms. It freed them from traveling long distances for a few hours meeting, conference, or event. As a result, many of them saw virtual professional interactions as a great step towards work-life balance.
2. Potential Cost Saving
Covid-19 has been a severe hit for businesses worldwide but in that phase reduced business travels also saved companies a huge expense.
Amazon CFO – Brian Olsavsky reported in 2020, “We saved nearly US$1 billion in travel this year because travel’s ground to a halt – internal travel, travel on expenses. Things like that will resume at a later date [but] maybe not get to the same levels as [in] the past.”
Thus, on one side where reduced business travels proved detrimental for the travel industry, the businesses saved a lot by relying on virtual platforms.
3. Environmental Saving
Without a doubt, there is a huge impact of business travel on the environment as well. As per Climate Group estimate, a 40% decrease in international business trips can cut up to 28 million tons of CO₂ a year.
Global accountant network, PwC, estimated their business traveling as their biggest contributor to carbon emission i.e., 53%. The corporate sustainability head of PwC says,
“By equipping our people to use technology to collaborate from anywhere, at any time, we’ve been able to decouple our business growth from our environmental impacts.”
Thankfully, we are seeing healthy eco-friendly initiatives across businesses. In this regard, giant companies such as Apple, Starbucks, and IKEA are prioritizing sustainability like never before. The greener businesses are taking amazing environmental initiatives, such as using eco-friendly products and recycling plants.
That being said, till now when businesses have become used to digital meetings, we assume green companies will avoid business travel as much as they can – due to its harmful environmental effects.
Why Do Businesses Think that Business Travel is Still Crucial?
Are the above-mentioned factors strong enough to completely evolve the future of business travel? Well, it makes us curious to know the other side of the story before making any opinion.
So, let’s skim through the pain points of executives who feel that business travel is still crucial for business growth.
- Forging New Relationships
Networking is among the top motivators for professionals to attend in-person events and meetings. They see it as an opportunity to expand their professional network – opening the doors of more opportunities. However, virtual events and online interactions don’t seem to satisfy executives fully.
“Face-to-face interactions allow trust to be built.” This statement from a business executive, Glynn, reflects that professionals still find face-to-face interactions easier to develop productive relationships.
Likewise, Lahav – the president of the International Association of Professional Congress Organizers (IAPCO), stresses that virtual platforms aren’t fully able to recreate the feelings of physical interaction.
“The need to shake hands, hug, and generally share the same space is invaluable,” says Lahav.
On top of that, most of the international business meetings come along with cultural differences- both parties have to stay careful regarding cultural sensitivities. And executives think they can represent themselves better during in-person meetings.
In short, in-person business meetings are still thought to be necessary for mission-critical business deals.
2. Cyber Threat to Online Platforms
Cyber threat is the biggest risk for virtual events and remote working. With the increased cybercrime ratio, it is still challenging for companies to keep sensitive information safe.
Moreover, a severe security backlash faced by major companies such as Zoom also made professionals rethink their meeting medium. Businesses don’t find online platforms as safe as live events or corporate meetings behind closed doors.
What will be The Future of Business and Incentive Travel in The Age of Hybrid Events?
After knowing both sides of the picture and analyzing the perspectives of executives, let’s see what’s the future of the business travel industry.
- Fewer But Mind-Full Business Travel
Amidst the COVID-19 outbreak and social distancing concerns, business owners and employees have become used to virtual meetings. It felt a dramatic change in the start but gradually companies learned how to cope with it.
It means that executives are going to prefer fewer but mindful business travels during and after the pandemic as well. Unlike the pre-COVID phase, companies will evaluate carefully whether it is essential to do in-person meetings or virtual interaction can serve the purpose well. These consciously evaluated traveling decisions will benefit both employers and employees when it comes to cost and work-life balance.
Microsoft’s global travel director, Eric Bailey, says that from now onwards, he will evaluate his business travel decisions on multiple factors.
“In the past, if I flew to New York, I would line up maybe three meetings. That won’t be good enough anymore. That will have to be eight or 10 meetings now, to justify the expense, from a dollars’ perspective, yes, but also from a time perspective and in terms of carbon emissions.”
Likewise, Bill Gates predicts that 50% of business travel will decline in the post-COVID period.
2. Company-Wide Business Travel and Expense Management Tools
In addition to being mindful, companies are now expected to use business travel and expense management tools.
In the past few months, we have seen frustration among employees regarding canceled flights and hotel bookings. This all makes business travel inefficient, hectic, and time-consuming.
Thus, now companies will be more inclined towards using reliable travel management solutions to streamline their traveling journeys. For instance, if the employees need to be replicated due to sudden lockdown or change in government policies, it will be easy for mega-companies to track the employees’ journey and come up with the best possible solutions. Having all information in one place will save companies invaluable time and stress.
To Wrap It Up
In the light of the above-mentioned analysis, it is safer to say that businesses are now adopting new habits when it comes to business travel. The executives are trying to be more cautious about making business decisions. Because in the intense COVID phase, companies have learned the differences between essential and non-essential in-person meetings.
On the flip side, we are also seeing significant investments in virtual meeting platforms. Now, businesses are more inclined towards using the platform having numerous features to make their digital meetings interactive.
So, the declined business travels and increased use of comprehensive virtual meeting platforms will go hand in hand in the post-COVID world for longer. Or, maybe forever?
What do you think? Share your thoughts with us in the comments section below.
