Thursday, May 6, 2010

Volcanic Wake-Up Call

Last month, an un-spellable and unpronounceable volcano erupted in Iceland, closing down airspace over Europe and stranding travellers globally. I know this not only because the world-wide media attention, but because I, too, was stranded (although I might add that there are FAR worse places to be stranded than in London, England). This threw a big old monkey wrench into business travel, too, including meetings and events.

While we won't know for a while what the total impact of this event had on meetings/events, I propose the meetings industry take this as a wake-up call, not because I think the volcano will continue to erupt (it might), but because I can think of other situations that would have a similar, if less spectacularly photogenic, impact on travel. And travel is, as one industry colleague says, the Achilles Heel of the meetings industry. Everything depends on travel, including not only getting the delegates/attendees to the site, but also getting things to the delegates...like food, trinkets and speakers, to name only three. (For more on this topic, I recently wrote an article on mobility in the industry: On the Move )

"Peak oil" is a term that isn't all that familiar to the meetings industry. Yet. Fiona Pelham of Sustainable Events Ltd and I did a session at an industry conference last year, based on the Transition Town model, that introduced this concept and potential impact that less oil -- or, in the short term, more expensive oil -- would have on the industry. The current business model for meetings/events is based on cheap oil. Everyone remembers what happened two years ago when oil peaked around $150/barrel; travel diminished as fewer people could afford to travel, and several airlines folded because the cost of fuel is a major cost item, currently number two after labour costs. However, according to IATA, in 2007, for the first time ever, fuel costs superseded labour as the number one operating cost. It doesn't take a huge stretch of the imagination to see that expensive oil would have a far more long-lasting impact on the meetings industry than a volcanic eruption. This is a business sustainability issue.

The volcanic eruption in Iceland is a wake-up call for the industry to do some business forecasting that includes situations of (permanently?) reduced travel. This is important for these reasons:
  1. Continuity of business
  2. Risk management
  3. Assessment of alternatives while not in crisis situation
  4. Strategic direction taking into account global drivers
  5. Sustainability of business
  6. Relevance to customer base

So, Eyjafjallajokull! (That's Icelandic for "wake-up call").

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