The looming impacts of reduced corporate travel
How health concerns and cost savings are making long-term changes to the business trip
Travel bans have proliferated in countries around the world during the pandemic. But even as governments tentatively ease restrictions, companies are making more permanent changes to business trips.
Over two-thirds of global firms in Asia Pacific intend to limit business travel permanently, according to a survey from JLL. Meanwhile, more than half the respondents in a survey of Fortune 500 chief executives showed trips would not return to pre-COVID-levels, according to the Fortune magazine survey.
“COVID-19 has put the health and safety of employees center stage. This will extend to all aspects of corporate life, including business travel,” says Kamya Miglani, Director of Corporate Solutions Research, JLL Asia Pacific. “There will be more stringent due-diligence done to assess the need and purpose of travel.”
Savings and efficiency
Changing rules on quarantines and self-isolation, as well as second waves of infections, have made it harder for companies to relax rules. But it’s not just health factors at play.
Video conferencing has been seen to eliminate some need for face-to-face meetings. As the workforce gets used to meeting virtually, there could be fewer incentives to put employees on a plane for trips lasting just a couple of days, says Miglani.
The resulting cost savings is attractive while the global economy braces itself for more pain.
“This economic outlook is further dampened by the fear of a second wave and the lack of vaccine,” says Miglani. “Businesses are still in a prolonged recovery period affecting growth and continuity. Cutting business travel is an easy way to minimise cost during this period. It won’t be surprising to see some business travel reducing permanently in the post-COVID times.”
Impact on corporate life
The reduction in corporate travel might mean more employees in the office, but it is unlikely to pose significant changes for the real estate footprint. The total number of employees in the office is just one factor that will affect the demand for space, says James Taylor, Head of Corporate Solutions Research, JLL Asia Pacific.
“Offices were already changing pre-COVID,” he says. “Post pandemic there will likely be more investment in things like technology, which will facilitate both in-office collaboration and remote working. Tech tools are also likely to serve as an alternative to business travel in the medium term.”
Nevertheless, there could also be some adverse impact on morale. In many organisations, corporate travel is seen as a perk. And for some, the value of a face-to-face meetings cannot be replaced, especially when it comes to building relationships or collaborating.
There will be a need to revisit parameters for corporate travel to make every meeting or trip count, while putting employees’ health at the forefront.
“Travel has long been key part of doing business for some roles but business travel, like many other facets of corporate life, will have to adjust to a new reality, with a renewed focus on health and well-being and the adoption and use of technology,” says Taylor.