As the travel business goes bust, videoconferencing, Web-casting, and satellite services are starting to boom.
As the travel business goes bust, videoconferencing, Web-casting, and satellite services are starting to boom.
Special Report: Tools that will let you stay grounded
Alex Stanton would have swum across the Atlantic to woo that special prospective client in the United Kingdom. Ultimately, he only had to go downstairs.
Stanton, CEO of Stanton Crenshaw Communications, in New York City, passionately wanted a contract to represent a certain European telecommunications company. He and his team planned to fly to London in mid-September to pitch their proposal in person. But then came September 11, when terrorist hijackings grounded all U.S. air travel for three days and delayed many overseas flights for several days longer. With the Twin Towers wreckage billowing smoke just a few miles away, Stanton asked his prospective clients to postpone the meeting. They politely declined. They wanted to pick their public-relations firm that week to get an overdue marketing campaign off the ground.
In seeking options, Stanton didn't have to look far. He dropped in on ICE Inc., a marketing-communications company located two floors below his office, on the hunch that the company might have videoconferencing equipment. In the spirit of post-attack camaraderie, Stanton's neighbors offered to let him borrow their boardroom, their equipment, and a technician. Thrilled, Stanton called London. Fortunately, the prospective client had a compatible setup, and its executives were perfectly happy to meet virtually.
So, at the appointed time, Stanton's team went downstairs, faced the cameras, and put on a one-hour show for a five-person audience across the pond. "We did a couple of rehearsals," Stanton says. "We found you have to stage it a little more than you might in person. You have to decide who's going to talk when, and you can't interrupt as much." While the transatlantic sound was fine, the video occasionally jerked or froze. And the presentation didn't feel quite natural. The executives in London faced a fixed camera, which never moved even when they did, and occasionally someone would shift out of view, forcing the presenters to address a disembodied voice. "You're sort of at the end of a tunnel," Stanton says. "It's hard to see how people are reacting to your ideas."
Despite the drawbacks, Stanton's team members felt they'd made their case, even after the telecom company awarded the contract to a competitor (which, coincidentally, was another New York City PR agency forced by circumstances to pitch by videoconference). "We didn't win, but at least we were on equal footing," Stanton says.
Like Stanton's company, many small and midsize businesses have built their reputation on traveling to meet far-flung colleagues, customers, partners, and prospects. And like Stanton, who's now considering a blend of videoconferencing and personal visits, many CEOs are now reexamining the assumption that being in business means being on the road.
The most urgent soul-searching, of course, stems directly from the September 11 attacks. And the November 12 crash of an American Airlines plane in Queens, N.Y., did little to allay the fears of an already leery traveling public. But even before those events, the slumping economy prompted many companies to curb their travel expenses. In April 2001 the National Business Travel Association, a trade group based in Alexandria, Va., polled 200 companies of all sizes and found that 33% were using or considering collaboration technologies, primarily videoconferencing, to eliminate costly trips. Five months later, following the suicide jet crashes, nearly 90% of those polled said they'd now consider high-tech options to travel.
It's too early to say if increased scrutiny of business travel represents a true change in thinking, a permanent shift away from our economy's air dependency. Right now many CEOs seem to be in wait-and-see mode: Wait and see what happens in the U.S.-led "war on terrorism." Wait and see whether there are more hijackings, air disasters, or other threats at home. Wait and see whether the economy starts to rebound.
But it's safe to draw a few conclusions. First, for both financial and security-related reasons, many CEOs are developing restrictive new travel policies. In addition, many companies are experimenting with high-tech options that let them do their jobs closer to home. Some are already finding those alternatives surprisingly attractive compared with long-distance business trips with all their expense, time investment, and hassles.
ON SOLID GROUND: Alex Stanton, CEO of Stanton Crenshaw Communications, needed to make his pitch without getting on a plane.
Ultimately, though, nobody expects to eliminate the need for business travel. As Daniel P. Brogan, president and CEO of the San Diego architecture firm Earl Walls Associates, puts it: "I see this as an opportunity to rethink the way we do business. But we're never going to get away from traveling. Our business is still very much hands-on."
When it comes to substituting technology for travel, options range from the almost-free to those requiring another line on next year's budget. On the low end: making better use of existing equipment, an approach as simple as spending more time on conference calls. On the high end: renting a television studio for a satellite broadcast or even investing in an in-house, state-of-the-art videoconferencing studio. In between: options like Web-based conferencing and broadcasting, setting up virtual private networks, using peer-to-peer technology, and -- especially in an era of germ-tainted mail -- increasing use of E-mail, fax, and instant messaging. (See "The Next Best Thing to Being There," below.)
Obviously, picking the right option depends on what the company needs to accomplish and what barriers it must overcome to get there. The following are several common postattack headaches and the technology prescription for relieving them:
Your former "road warriors" are skittish about taking to the skies.
Earl Walls Associates specializes in designing scientific laboratories. Thanks to that narrow niche market, the company serves clients all over the world. But in recent months "I've definitely told people not to travel if they don't have to," says CEO Brogan. Instead, the company increasingly runs client meetings from two rented videoconferencing facilities located close to its office. Even at $1,000 a day, videoconferencing is cheaper than sending a team in person, especially when you figure in the loss of productivity on travel days.
Of course, architects must sometimes meet face-to-face with clients to review plans, but Brogan is now trying to do as much virtual up-front and follow-up work as possible. He's even earmarked $25,000 this year for an in-house videoconferencing studio. But just as you can't call somebody who doesn't have a telephone, you can't videoconference with somebody who doesn't have a compatible setup. So before he actually spends a dime, Brogan is polling the company's clients to find out whether they've got equipment -- or at least access to it -- on their end.
On September 11, employees at Whale Communications Ltd., a network-security company with offices in Fort Lee, N.J., just across the Hudson River from Manhattan, watched the World Trade Center towers burn and collapse after being hit by hijacked jets. Not surprisingly, many Whale employees didn't want to fly after that. CEO Elad Baron, who grew up amid the threat of terrorism in his native Israel, couldn't blame them; he immediately declared all air travel optional.
Fortunately, Whale had started scrutinizing its travel costs earlier in 2001, when many of the company's 60 employees were spending up to 75% of their time traveling to visit clients across the United States or in the company's research-and-development facility in Israel. "Even before September 11, we figured out that was not very efficient, so we really began cutting back," Baron says. So he invested $38,000 in Web-conferencing and videoconferencing hardware, software, and services. By September, he'd cut travel time for most employees to just 20% to 25% of their total hours. Because of the savings on travel expenditures, he expects to recoup his investment early this year.
However, some employees' jobs still require travel. If they're afraid to board a plane, Baron expects them to make other arrangements. In the most extreme case, a sales rep who'd previously flown nationwide started driving everywhere instead. His longest trek: from New Jersey to Charlotte, N.C. -- about 1,300 miles round-trip. Because the rep traveled on weekends, he lost no work time -- and got no objections from the boss. "I don't mind, as long as the customer gets served," Baron says.
Your chief ambassador wants to stay home.
In many companies, there's one person -- sometimes the CEO, sometimes another executive -- who has long served as the public face of the business. But now the ambassador wants to spend less time, or no time, in the air.
That's the case at Phenix & Phenix Literary Publicists Inc., an 11-person agency based in Austin, far from the nation's major news and publishing centers. A year ago, CEO Leann Phenix created the position of national media director, a job requiring frequent coast-to-coast travel to attend book-launch events, meet with the media, and speak at writers' conferences. Staff publicist Marika Flatt was promoted into the new job and at first rather enjoyed all those cross-country flights. But Flatt, the mother of a 14-month-old daughter, hasn't been on a plane since the terrorist attacks.
A NEW ATTITUDE: "I see this as an opportunity to rethink the way we do business," says Daniel P. Brogan. "But we're never going to get away from traveling. Our business is still very much hands-on."
Like other companies, Phenix & Phenix has considered videoconferencing and other high-tech options. But because Flatt is the only employee who needs to travel extensively, the business's executives have decided that such an investment wouldn't make sense for the company -- at least so far. Instead, Flatt is building and maintaining some other long-term relationships: with the telephone and the computer. "If there's a writer I haven't been introduced to yet, I'll send an E-mail and say, 'Can I call you at such-and-such a time?" she says. "It's obviously not as good as meeting face-to-face." But that's how things will have to be, she says, "until things simmer down a little bit and we build our confidence back up in the airlines." Meanwhile, will staying close to home hurt business? "Definitely," Flatt says, sighing. "Definitely."
You need to do hands-on work with faraway partners, but you don't necessarily need to see them.
Network Orange Inc., in Boca Raton, Fla., which manufactures and sells network-testing and -control equipment, serves customers all over the United States. These days president Mike Vislocky has been concerned about sending employees across the country to touch base with customers. "It's not just a fear of flying," he says. "It's the prospect of being stranded away from home."
So Network Orange invested in a Web-conferencing software called WebDemo, which lets the Florida team have virtual visits with customers. The product allows a meeting's participants to view a PowerPoint presentation or edit a document together, screen by screen, in real time over the Internet. Meanwhile, they're on a conference call, discussing what they're seeing. Overall, "it's not bad," says Vislocky. "You can take breaks; you can put your phone on mute and just listen until it's time for you to say something. I have a portable phone, so I can even walk around until I need to come back to the screen." Vislocky hasn't used videoconferencing and says he probably won't. "None of the stuff we do benefits from being able to see other people."
You don't travel much, but your clients do.
Royce Carlton Inc., a New York City-based speakers' agency, represents about 50 famous clients. Among them: Anna Quindlen, the former New York Times columnist turned best-selling novelist. Agency CEO Carlton Sedgeley had booked Quindlen to speak at a Houston fund-raiser in late September. But after the attacks, Quindlen, who lives in Manhattan, refused to get on a plane. So Sedgeley arranged for her to speak by videoconference, a solution he calls less than ideal. "It's second-best," he says. "It's just not as satisfying as someone being there. You don't get to press the flesh. You don't get the book signing." On the other hand, for an investment of about $350, the show went on, and Sedgeley collected his fee, albeit a reduced one.
BUSINESS AS USUAL: Rob DeRocker of Development Counsellors International has flown 16 times since September 11.
Sedgeley has been using travel-obviating technology since well before September 11. In November 2000, he helped political analyst Jeff Greenfield give a virtual talk using technology far more sophisticated than videoconferencing. Greenfield was scheduled to address a group in Palm Springs, Calif., but when the U.S. presidential race stayed too close to call for weeks, Greenfield couldn't leave Florida, where officials were recounting the ballots by hand. Instead, he addressed the California crowd via satellite from a TV studio in Palm Beach, Fla. The satellite link provided a much higher quality transmission than even the best videoconferencing and, not surprisingly, bore a price tag to match: about $4,000 for that particular venture, Sedgeley says. In the weeks following the attacks, he arranged appearances broadcast by satellite or videoconference for several other speakers.
You must travel, period.
For some companies, no technology alternative can replace being there. As Andrew Zacharakis, professor of entrepreneurship at Babson College, in Wellesley, Mass., puts it: "If you have some hot sales prospects and you need that face-to-face contact, I would say you have to get on the plane."
Rob DeRocker did just that shortly after the attacks. DeRocker is executive vice-president and part owner of Development Counsellors International, a 30-person company that develops marketing campaigns promoting tourism. He flew to Kansas City the Monday following September 11. Over the next several weeks, he boarded 16 airplanes. (On one flight, owing to increased security, he had to remove his shoes and run them through a metal detector.) And so far, he's requiring his account executives to fly because the company's survival depends on it. "We can't forgo traveling if we stay in this business," he says. "It's hard to lead a press trip to Tacoma unless you're there, and driving isn't an option." There's just one thing that might change his insistence on flying: another terrorist incident involving aircraft.
Meanwhile, many companies continue to seek the perfect balance of technology and travel. For Alex Stanton, who used videoconferencing to make his pitch to the European telecom company, it's a matter of compromise. "Often, when we'd go and do these things, we'd send two or three or four people to show them our whole team," he says. Now he considers sending one person -- perhaps the team leader -- to present in person and having other employees attend by videoconference. "It's not perfect," he says, "but we don't live in a perfect world."
Anne Stuart is a senior writer at Inc.
Nothing digital can duplicate a hearty handshake. But if you want to keep your company aloft without putting yourself -- or anybody else -- on an airplane, you can consider a wide range of electronic alternatives.
Please e-mail your comments to firstname.lastname@example.org.
For more electronic alternatives, see 5 Travel-Reducing Technologies.