Mike Hohnen

I learned a new word the other day – a word that sent shivers down my spine. Not that i have not suspected that this development was inevitable but still, seeing it in print was a jolt. The word is ” Travel Avoidance”. A conscious policy by large companies to reduced travel and f2f meeting wherever they can.

In a report published by the Center for Hospitality Research at Cornell University with the title ‘Hospitality Business Models confront the future of meetings‘ Cisco outline how they have chalked up $400 million in direct savings and $150 million in productivity gains by switching as much of their travel/meeting actives as possible to ‘TelePresence‘.

The report also mentions research by Gartner Inc. that video conferencing will replace 2,1 Million airline seats by 2012 representing a revenue decline of $3,5 Billion for the travel and Hospitality industries.

And Meeting review wrote this :

2010 has been the year that everyone suddenly started to take virtual meetings and events seriously, indeed the mainstream industry is even starting to see them no longer as a threat but instead as a way of extending the reach, the audience and, importantly, the revenues for their events.

See the full article here

So what to do?

The article suggest that Hotels should invest in video conference equipment so that they can offer this service to clients. I am not so sure that is the way to go. If we look back some years ago LCD projectors where very expensive and as a consequence only the largest companies had them – in the beginning.
Smaller companies would go to hotels and rent one. But soon the price of LCD’s came tumbling down and suddenly they where not so special anymore. Today we all have our own. And the fact that a hotel can provide one does not exactly constitute a competitive advantage

My prediction is that the same will happen with video conferencing – companies will get their own kits and virtual conference room in hotels will become obsolete.

A better plan might be to leap frog past that and take a look at the structure of the meeting market as it is emerging.

One way to do that could be to map it on a 2×2 matrix with number of participants on the one axis and the degree of interaction from monologue to deep dialog on the other axis .

That could roughly look something like this:

In the bottom half of this matrix there is mainly emphasis on one way info transmission, possibly with a few questions from the floor. This type of meeting is handled brilliantly by various tech solutions and there will be no stopping that trend developing even further. In that sense this type of meeting will slowly disappear from the traditional venues and move to virtual (also because participants are thoroughly tired of attending this type of meeting or conference).

But on the top half of the matrix where the focus is on interaction /participation and deep dialog, high tech solutions do not do the job very well. As Marchall McLuhan said the more complex the message the more complex a medium do you need, and the most complex we have is f2f.

Now if you are providing meeting facilities – go have a look at your breakout room, your standard meeting room set up etc. Are the facilities that you provide conducive to dialog or to monologue?

To me the gray cloud on the drawing represents yesterdays meetings, they will be taken over by high tech solutions and will not require f2f and the yellow cloud represents tomorrows meetings space where we solve the complex and tricky stuff through collaboration and involvement.

The reason i have the number of participant in the matrix is that i see a sweet spot in the 10 to 75 segment ( upper right corner of the matrix) because when you move to very large groups ( upper left of the matrix), and think dialog then tech shows its face aging ( Twiter, FB Etc)

When i presented this to one of my hotelier friends his response was, “but 80% of our meeting business today is Cinema- or U-table set up.” Yes I know i have seen that as well. But if you plot types of meeting on a bell curve then, at the top of the curve (mainstream) you will find the cinema set up and the U-table – fast forward a year or two and where is what was at the top of the top of the bell curve now?
Going down, fast.
At the beginning of the bell curve we now find Dialog, participatory meeting Art of Hosting etc. Where will that be in 2 years time? On its way up, heading for main stream status.

In summary it is going to be increasingly difficult for meeting facility providers to justify that they are providing value when it comes to ‘monologue’ meetings. It can be done better and cheaper with technology – and that type of meeting is a god case for Travel Avoidance”

Where they can make a huge difference and add value is by learning how to provide space and surroundings that are conducive to deep dialog in the broadest sense – and believe me that is not a banqueting room set up cinema style

We kicked of Module 3, on our 3 year 6 module Service Management training this week. Seventeen energetic and ready-to -go ‘students’ worked for the days getting to grips with marketing of services and the role of loyalty and satisfaction.

We wrapped up the 3 days with a ProActionCafe – a great new tool that we learned at our Art of Hosting training in Aarhus in August. The cafe combines the best of World Cafe, Open Space Technology and Action Learning.

Four students hosted 4 workshop on developing the focus for their action learning question – the question they will work on for the next 16 weeks and that will form the basis of their final written assignment in December. The Proaction Cafe was hosted by Kathrine Procter who is the Program Manager on this module and works with structured questioning in three rounds. Each round has 3 new expert help the host develop depth, perspective and action items on the chosen question.

The feed back afterwards was awesome – not only did the 4 hosts declare that for the first time did they have a clear focus on their assignment at a very early stage but the other participants also felt that they had learned a lot about how they could approach their learning question.

An unexpected bonus that we had not thought of was that participants felt that working in the ProAction Cafe format also gave them a great opportunity to recapitulate the learning from the three previous days as they wove these topics into the problem solving discussion at the tables. It does not get much better in my world.

Powerful stuff – that we will develop further.

A coming paper in the Journal of Marketing addresses that very subject. Building on past research on the role of gratitude in human relationships, it argues that a customer who is made to feel grateful most likely becomes enduringly loyal as a result. Gratitude, as the paper bluntly puts it, can “increase purchase intentions, sales growth and share of wallet.” Robert Palmatier, an associate professor of marketing at the University of Washington and an author of the paper, says that making a customer feel truly grateful toward a business is harder than it might sound. And the hard-wired feelings of reciprocity that can trigger gratitude can just as easily trigger the sense that you’re being treated unfairly.

Read the full article in the NYT

Kodak did not loose the market for paper film because of Fuji or Agfa. The market for film was replaced by digital cameras. British Airways need not worry to much about Lufthansa or SAS – Ryan Air is a problem and so on.

In these examples what has happened is that competition has come from where it was least expected and in both cases this competition was initially ignored as not significant – “they are not delivering the kind of quality that we do” – and bam! One day we wake up and Ryan Air is a huge airline business and we all have digital cameras in our pockets – even the pro’s

This has happened in industry after industry ever since the buggy whip business was exterminated by automobiles. Why and how this happens is well documented by Clayton Christensen in his wonderful book : The Innovators Dilemma

The same shift in client behavior is now occurring in the meeting and conference industry. The competition is not from other regular players in the market but from a combination of events that together have created a perfect storm. Once the storm is over the market will never be the same again.

The elements that are causing this are:

1. The financial crisis has forced business to be more careful how they spend their money so they question the value of every thing – if it is not adding value why are we doing it? ROI i now a key requirement – see more here

2. CSR – The realization that we need to curb our Co2 emissions and one of the big sinners in this is of course travel. (It is also a convenient excuse to cut travel cost)

3. Time pressure on every one means that we are are all looking for ways to cram more into the same 24h/7d week /360d year frame – there is now mores stuff to do, read, see than we have ever experienced before and that means prioritizing. Asking one self hard questions like: is this worth the effort ( travel, money, another night away from home etc).

4. Web 2.0 the big shift from web 1.0 is the ability to interact – real time two way communication on the web. Virtual classrooms, breakout rooms – web casts etc. There is a whole new industry that is growing rapidly and that sees a huge opportunity to replace the traditional meeting environment with a virtual environments. Brush up on Web 2.0 and learning here

Points one 1-3 are the problems we would all like to see solved and point 4 seems to be a possible solution. Not perfect but it works and is easy ( Just like digital cameras)

“At IKEA Virtual Meetings should always be first choice”

Progressive business are responding fast. IKEA has a campaign running called Meet More Travel Less

Tandberg, TNT and Vodaphone are others also working on this.

TANDBERG – 100 000 video calls per month – 2500 flights avoided, 2,5M$ saved on business trips (30M$per year) – 17500 man-hour saved per month – 275 tons of CO2 saved per month

TNT – On track to save nearly11,5 $ in 4 years by replacing travels with videoconferencing – ROI:71%

VODAFONE – 25% reduction in business trips in 2 years – Resulting in double digit millions of cost savings

The response from the meeting industry is ahh.. no need to worry, virtual meetings will never be as good as f2f meetings.

Perhaps not but that is exactly what Kodak said about digital cameras, What BA said about the zero service concept from Ryan Air and what the vinyl record producers said about music on CD’s.

So is there no hope for the meeting industry – yes there is but we need to understand how to deliver value. Class rooms and serial power point monologue are not the solution.

The problem with creating value in the traditional meeting and conference set up is that it is very limited – there is often a short term entertainment value, the odd aha experience – but that’s it.

In a situation where we are all under pressure. Supply, by far, outstrips demand in virtually all industries and services – most business’ create meetings and conferences in order to help participants change – but as any one who has tried to get a teenager to clean up their room by telling them to do so, will recognize, we do not change because someone tells us to do so ( there would be no smokers left in the world if that where the case) Telling does not work.

We change when we arrive at our own conclusions. ( if you do not believe me read Change or Die that will help you reach your own conclusion)

So having one or even worse a series of speakers stand up and tell us what to do, think or feel in order to cope with change is relatively useless – the ROI is negligible – and in that connection the speakers fee is not the main cost, it is the time and travel of the participants.

In order to create real change we need to gather people in order for them to interact. Change requires learning and learning is collaborative – no I do not mean 10 min of ‘networking at the coffee break – but real meaningful conversations – deep dialog.

Only through dialog will you get people to reach their own conclusions and then hopefully act on them. Yes we can have inspirational input if it is short, sweet and to the point AND gets people thinking and talking.

But this will require the meeting industry to radically change their formats,( venues, room, seating,speaking formats, tools, etc) those that do will survive those that don’t will join the buggy whip business as interesting business cases for future students to smile at.

I found this at HotelNetwork – I really like it

October marks the tenth anniversary of the coining of the phrase, “amenity creep.” With all of this new “stuff” for our guests, you would expect to see guest satisfaction scores increase. But the North America Hotel Guest Satisfaction Index Study by J.D. Power and Associates showed that overall guest satisfaction has been declining over the past several years.

The key to success isn’t adding more amenities; it is adding more authenticity to your hospitality.

The most successful operators are differentiating themselves by providing authentic hospitality through Systems of Truth and Honest Leadership.

Systems of truth
You can’t put a line in your new hire orientation that says, “give authentic hospitality,” and expect it to happen. It happens as the result of systems and processes that you put into place, which I call Systems of Truth. Two that work in any hotel are:

* Active vs. passive service—Stop asking guests to “call if you need anything,” and start asking them what you can do for them. Don’t wait for the guests to come to you because statistics show they won’t. Solve problems on the spot.
* After action review—Common in the military, this post-event meeting is structured to give honest feedback. Gather employees and let everyone speak as equals. This allows continuous improvement in every aspect of the guest’s path.

Honest leadership
Great operators know that even with exceptional talent, the key to producing results is leadership. Good leadership comes down to one thing: trust. Some suggestions on bringing honesty into leadership:

* 100 percent rule—Tell the whole truth. We have a responsibility to let associates know all of the information, especially the “why.”
* Care to confront—It’s important to be willing as honest leaders to confront even our best associates about their performance. This feedback leads to a long-term trust that can’t be faked.

Our business is all about relationships—the relationships your staff has with your guests and the relationship you have with your staff. That is authentic hospitality.

hwn@questex.com