Are We At Peak Business Travel?

Over at Skift, I have started an interview series called "Travel's Path Forward", as a way to give a bigger historical and geopolitical perspective on the crisis in the global travel industry due to coronavirus and a potential economic downturn coming. In this series I talk to people with long-range view of the world, in and around travel. In the first interview, I talked to  Parag Khanna, author and geopolitical scientist who has written extensively — including articles and multiple books — on the changing centricity of the world. Coronavirus and many previous global virus outbreaks have come through Asia, and he understands what that means in a very interconnected world, and what that means to travel.

In this fascinating interview, I asked him if we are in an age of peak business travel? Will the fears of travel, the climate change backlash on travel, the video and virtual presence technologies finally come through with the nirvana of remote working and less business travel for the world? Here was his answer, which I have posted below, I think you will find it fascinating. Read the full interview here.

Rafat: Do you think we’re at peak business travel?

Khanna: I was revisiting a section of my next book that actually talks about this in light of the virus and checked if I wanted to still make the same arguments. Again, there are many reasons why we travel. So for example, when you think about peak business travel, OK, you’re again an established business like Cisco and you could cut back on physical travel, but you had to have a lot of physical travel to create the conditions for there to be less travel, right?

For example, my brother had to bust his butt traveling to dozens of countries every single year to set up teams that are the equivalent of his team in San Jose. Now that they all know each other physically, having circulated around the world, met each other, had conferences and team building, now they can communicate more digitally on a regular basis and don’t have to see each other every other month.

Most companies in the world are not Cisco. If you’re trying to build your business and trying to expand globally, you can’t literally just start cold calling and sending emails and hoping that you’re going to start landing big deals on the other side of the world.

For most companies that want to expand, whether it is across state lines in America or internationally around the world, you still do have to go there. Then let’s remember there’s other motivations, like regulatory barriers as well.

We don’t actually live in a flat world. So you have to go and negotiate in a world where protectionism, industrial policy, resource nationalism, all these things are kicking in and you have to set up local operations in those countries because there’s nothing seamless that are doing global business today.

Then there is a very important factor and that is secrecy. At the end of the day, we also know that all of our communications are being monitored by someone or the other. And the only way to actually have an honest conversation that isn’t being surveilled is to do it in person.

Then on top of all of that, there’s the experience factor. What collides with the idea of peak travel for business or for leisure is that this is an age whereas you know very well, people want to pay more and more for experiences, and experience just means moving, means mobility. It means travel. So how are you going to gain a competitive advantage over your rivals in banking or any other industry if you’re not offering people that added something, which is very often a physical experience?

We’re talking about a generation, a younger generation that has less and less possessions, that wants to travel, is more and more mobile, and see more and more things, that it literally is living the experience economy. So. I would say, no way. All the flight shaming in the world, all the viruses in the world, are not going to stop people from justifying either at a visceral or human level or at a business level the human need to travel.

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Rafat Ali is the CEO and founder of Skift, the global travel intelligence company: News, Analysis, Research and conferences on online travel, airlines, hotels, tourism, cruises, startups, tech and more. Subscribe to the daily newsletter and you will be a lot smarter about the future of travel, we guarantee it! 

Previously, he was the founder of paidContent, which he sold to Guardian Media Group in 2008.