We have vaccines. Are we back to normal yet?

With the rollout of Covid-19 vaccines, the new year has brought with it a renewed sense of hope that travel, tourism, and business events will be “back to normal” within a number of months. And with close to 300 delegates gathering in Singapore, the “Global Broadcast Centre” for PCMA's Convening Leaders 2021 (13-14 January), that hope started to feel like a reality.

On-site antigen rapid tests were conducted on both days, with delegates split into seven separate zones. Each zone had a dedicated entry point for registration, separate rooms for testing, and designated seated for plenary sessions, as well as during lunch. Each zone featured a maximum of 50 delegates, so networking was muted, and an army of safe-distancing ambassadors was on-hand to intercept any unlawful wandering.

Nevertheless, testing logistics were seamless and the event format was well thought-out, with clear pathways and signage. The conference also provided an opportunity for the Singapore Tourism Board to test its new event management and safety protocols ahead of the World Economic Forum in May.

Foreign affairs columnist and bestselling author, Thomas Friedman, kicked things off (via a pre-recorded video link) by talking through macro social and economic trends that will likely affect the future of work. But the event planners in the room (most of which managed digital events for the better part of 2020) couldn’t get past Friedman's virtual background — a majestic, mountainous scene that kept re-shaping his silhouette every time he shuffled in his chair.

Then, Dr. Paul Tambyah, president-elect of the International Society of Infectious Diseases, and Nobel Laureate Professor, Peter Doherty, took to the stage and we got down to brass tacks — the vaccine and its impact.

Both said vaccines are “game changers”, but Prof. Doherty warned against the “polarisation of society” and the “pandemic of misinformation”. He advised the travel and events industry to commission its own research to “get good information out” and help drive advocacy efforts with policymakers.

Dr. Tambyah, meanwhile, said there is good evidence of “lasting immunity” — but herd immunity won’t be achieved until 2022. For those in the industry gearing up for a Q2 2021 rebound (and who’ve already exhausted cash reserves to claw through 2020) this was not welcome news. 

New reality for corporate travel and events

The next 12 months will be difficult. Given the added cost and time needed to travel, and confusion surrounding testing, Northstar Meetings Group executive vice president and group president, David Blansfield, says corporates will re-evaluate the elusive ROI of business travel and apply more discipline to assessing the return on expense.

“Now that travel budgets have essentially gone to zero, companies will look more at opportunities and less at savings, and the value generated from them.” He cited Microsoft, who recently estimated that a 1% shift in the company’s stock price represented 150 years of its travel budgets, combined. Hence, the focus on value-generation over savings.

Vivek Kumar Neb, managing director of Singapore-based research firm, Grail Insights, said “pressure on revenue and profitability will be acute in the short term” and will further hamper corporate travel".

Meanwhile, companies improvise and innovate in pandemic time. Blansfield said that 25% of tech companies have already diverted 50% of their travel budgets to technology that facilitates connections, with the aim to drive value generation. The question is — are these new means achieving the desired ends, and if so, are they sustainable over the longer term?

The value of meetings and events, therefore, must be high enough to outweigh the cost and risks involved, and outperform alternatives. But, as often argued, if the “value” of physical meetings lies in the “serendipitous moments that allow ideas to collide”, then socially-distanced events that split delegates into smaller cohorts and restrict intermingling present a problem. 

Optimism in APAC

When it comes to recovery projections, APAC is more optimistic than the rest of the world.

Citing a recent CNBC survey, Neb, said that CFOs in the U.S. and Europe have a pessimistic view of corporate travel recovery, where the majority don’t ever expect travel budgets to return to pre-pandemic level. In Asia-Pacific, however, CFOs are expecting a return within 2-3 years.

Neb puts this down to the nature of doing business in Asia, “which is driven by a culture of trust, where personal meetings play a key role. “Sectors such as manufacturing, pharma, construction, which include a higher degree of touch points and interactions, are likely to see an earlier recovery,” he added.

“Europe and the U.S. have a higher proportion of business travel spend concentrated in professional and service sectors and less in the industrial sectors that are showing early resilience, especially in China.

“Travel for internal MICE and other off-site gatherings may not return until well into 2021 or later. And some travel for internal purposes will be permanently replaced by virtual meetings and collaboration.”

Confidence and complexity

Amid the urgency to resume normal life, Neb said the availability of vaccines and widespread testing will boost confidence, but the complexity of government regulations and the high risk of fast-changing policies remains a challenge.

Blansfield experienced this first-hand. Travelling from the U.S. to attend Convening Leaders in Singapore, he said confusion over “which test to take” and “terminology discrepancies” on health documents almost caused him to miss the flight.

“Lack of standardisation about what kind of test is required, when they need to be timed so you get the results in time for your trip, getting the appointment (difficult with demand so high) and how the results are reported is a major hassle. Add on top of that airlines charging premiums in exchange for waiving change fees and you see how travellers might be daunted and not want to hassle with it,” he said.

“It really points out that if testing protocols are critical to recovery, the industry needs to get its act together and facilitate compliance in a coordinated fashion.”

As demonstrated by the tight measures in place at Convening Leaders, Singapore knows how to execute a "safe" event, but, once borders open, not all delegates will care. Looking ahead, the risk associated with meetings and events wont lie with hotels and venues — it will be inherent in the traveller. How will corporates (and event planners) manage risk with a room full of rule-breakers?