Even in this age of hyper-connectivity, travelling to help grow a company is often still essential. Whilst the economic situation over the last six years has encouraged more people to find alternatives to pricey trips out of the country, the number of sojourns Brits are taking is increasing year on year. Whilst not back up to its pre-recession level of 9,018,000, according the Office for National Statistics’ (ONS) report Travel Trends 2012, the number of overseas business trips has been increasing by at least 100,000 year-on-year since 2010, reaching 6,956,000 in 2012.
Clearly then, despite the ready availability of video-conferencing and cloud-hosting software, travel is still an essential element of the way the UK conducts enterprise. In part, this is because meeting face-to-face can give us so much more than FaceTime or Skype.
“Humans are still social,” says Philip Witheridge, CEO of the cloud services company Grove Group. Essentially, it can take a lot more than a video chat for us to build up a sense of trust in someone. “You’ve got to create substance and that human touch is about ‘if something goes wrong, is this guy just going to disappear or does he actually exist? Does he have the same values as me?’”
Whilst this may not be a big deal in low-value, high-volume areas like apps with a one-off payment, trust can play a huge part in whether an individual signs on the dotted line. Witheridge explains: “As the deal values become bigger, you have to involve more people and to get everyone on-side, you need to be circling around the environment in which you’re selling.”
This is something echoed by Steve Lowy, CEO of umi Digital and umi Hotels. “The majority of people, when they’re buying a service or even a product where there’s an element of service related to it, want to feel comfortable with the person selling it,” he comments. Relating an example where umi Hotels was looking at expanding in India, Lowy explains that, whilst he had a contact on the ground, he struggled to build up a relationship with a specific client via videoconferencing tools. “I was finding it really difficult,” he says. “I trust them and I don’t think they’re fraudulent people but I didn’t have that personal connection.”
However, whilst it may sound like an exercise in stating the obvious, taking a trip away can be a costly business, both in terms of the time involvement and the literal costs entailed. Lowy feels it’s often a case of doing some simple cost-benefit analysis. “I’d have to work out what my costs would be from the hotel, from the taxi, from everything,” he explains. “Say it was £3,000 or £4,000, then I’d ask ‘how many websites do I need to sell?’ or ‘would I get a new hotel contract and how much would that be worth?’”
Lowy gives an example of a UKTI-backed trip he took to the Caribbean – approached at the last minute, he was offered everything inclusive for a week at £500. “They guaranteed me three meetings a day with people I’d never usually meet,” he says. The prospect of meeting clients like the Hotel Association of Trinidad and the Ministry of Tourism was more than worth the ticket price. “We ended up getting one client and then we’ve got two or three still bubbling away; the one client paid for the trip but the others, if they come off, mean it will have been very profitable.”
But financial factors are far from the only consideration. For a CEO or managing director to ascertain whether they should be taking half the week out for a trip, it’s important to understand who prospective clients might be expecting to meet. “If Prince William, for example, was visiting Newcastle, he would expect to meet the mayor; he wouldn’t expect to meet the mayor’s assistant,” says Witheridge.
Often a CIO isn’t going to be just be content with a pitch from another CIO; instead they’ll want the assurance that only a CEO can provide. So in this situation, a chief exec’s presence will be required to give a potential client confidence that they are engaged and involved with the process and will be accessible in the future if required. Whilst they might not be needed to close a deal, showing it has their attention and seal of approval can add more value than a hundred sales talks. “The reality of it is, my job is not sales,” Witheridge comments. “My job is promoting Grove to the wider world and continuing that momentum.”
Another factor that can add impetus to the need for a business trip is the culture of the region or country in which a client is operating. “In the UK, people do business without meeting,” says Witheridge. “But in South Africa, there’s still a massive meeting culture.” Getting this wrong can mean the death of a potential deal so if it’s of significant value then it really is worth an entrepreneur making sure they’re aware of the cultural expectations involved.
Deciding whether to go, however, shouldn’t be a business owner’s only concern. Ensuring you get real value out of a trip is dependent on making the most of your time. “A lot of the events we go to are B2B travel events, so they often have appointment scheduling,” Lowy comments. “The minute that’s available, I go on, I fill out our profile, I get as many meetings as possible.” Whilst he concedes a business owner may be more driven than an employee to fill their schedule wall-to-wall, he feels it’s important to maximise the way you are using your time as a way of guaranteeing a return on your investment. “You need to know your own value and, with you being out of the office, what you are missing and gaining.”
In terms of the role one plays, it can often depend on the individual’s position in the company and the stage of the sales cycle which they are at. Often Witheridge feels, when closing a deal, it’s important to make sure you have the right people on hand. To this end, he will make sure he has a technical and sales expert on hand.
“I set the scene and the sales guy will say where the product is relevant for the customer,” he explains. “Then the technical person will say ‘Where’s the business problems? Where are the technical challenges? How are we going to integrate it with your backend systems?’”
Whilst a hardcore sales situation may not necessarily be what everyone thinks of when discussing jetting off to warmer climes, it’s important to recognise that this really should be the end game you have in mind. “There’s potential to actually seal a deal at that meeting,” says Lowy. And this will ultimately be the business case for any trip you take. “If, for example, you look at your P&L, share it with your staff and they’re like ‘Why did you go away on a jolly?’, you can say ‘Because I came back with £10,000 of business.’”
As Lowy explains, it can be tempting to view a business trip as a glamourous chance to get some sun, sea and champagne but as with any element of your enterprise, it’s important to think of the balance between the investment made and the returns it can offer.