Tag Archives: Turbulent Economy

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Incentive Travel: When Disaster Strikes

Incentive Travel & Charity Team Building: After Disaster Strikes

Just when the global economy seemed to be on the upswing, 2011 has ushered in a fresh set of natural disasters and societal turmoil. They have the potential to derail the global economic recovery.

Fresh in our memories are the BP crisis in the Gulf, the natural disasters in Australia and Haiti, Hurricane Katrina, and the boxing day tsunamis in south east Asia. It isn’t news to anyone reading this that there has been an earthquake followed by a tsunami, aftershocks, and instability at a nuclear complex in Japan, the world’s 3rd largest economy.

It is also not news that there have been a wave of protests in Egypt, Tunisia, Libya, and Bahrain. This is already creating a spike in oil prices and intermittent shortages in some areas.

When disaster strikes, the knee jerk reaction is “Oh, we can’t possibly consider taking our team there for a sales incentive trip or team building retreat”. Naturally, no one would be wise to take their team into an area during a period of instability, combat, or a pending nuclear meltdown. Unfortunately, long after calm has been restored and a crisis has subsided, there is usually a lingering fear of particular destinations. It always astonishes me that so many Canadian and American companies are afraid to take their sales teams to Dubai, Abu Dhabi or Oman because they have read about a crisis in the Gaza Strip, Yemen or some other area that is far away. I am orginally from Jamaica. It also baffles me when companies are nervous about booking incentives and retreats on the north coast because there has been a disturbance 2 to 2 1/2 hours away in a area of Kingston that is smaller than many suburban plazas in North America. I don’t get it but some companies have a tendency to avoid destinations that have gone through a crisis or period of turmoil like the plague. For a number of reasons, this is not a prudent strategy.

It is no longer a cliché that we live in a global village. Around the globe, waves of turbulence are likely to increase rather than decrease. No one knows where they will hit next. If every time a destination experiences a crisis companies cross it permanently off their list as “undesireable”, you’ll end up with fewer options for travel and a shrinking circle of influence. How will the economies of countries that have gone through a crisis ever recover if companies avoid doing business with them?

How is this relevant to incentive travel and foreign team buiding retreats? We are interconnected. If one area of the world does not do well, there will be a ripple effect. It may not be obvious but, ultimately, there will be an impact on the demand for your own products and services. For example, Japan is one of the largest oil consuming countries in the world. If the Japanese economy goes into recession and Japan’s demand for oil drops sharply, this will have an impact on the economies of all oil producing nations.

In 2003, my company launched a new team building programme called Visexecutaries: Seizing Opportunities in our Shifting Corporate Landscape. It includes a real Apprentice style project and a charitable component.

The core messages are:

  • turbulence is the new normal – I can’t take credit for that, Porter said it first
  • it is important to connect the dots as what happens in one part of the world has a ripple effect and may have an impact on your business
  • tunnel vision thinking and the not invented here syndrome are to be avoided at all costs as they can blindside you to changes in your market and untapped areas of growth
  • when one area of your community is hurting, it reduces the potential of the entire community so it’s important to give those in need a leg up

We are now seeing these themes reflected in newspaper headlines daily. In spite of this, many companies still resist those messages. They are stuck in the “not invented here” paradigm, dismissing anything that does not originate in their own industry or country as irrelevant. A news items that scrolled across my television screen on the TV listings channel really hammered this home for me. I am paraphrasing:

“There will not be immediate lay-offs at Japanese automobile factories in Ontario due to the halt of production in Japan”.

Ouch! Talk about connecting the dots. A tsunami that hits Japan on the other side of the world CAN potentially lead to lay-offs closer to home and have a negative impact on your local economy. If your company avoids certain destinations and their tourism industries go into a slump, it will have an impact on their economy and potentially ricochet and hit you in your own backyard.

Instead of permanently crossing certain destinations off your list, when disaster strikes, make them a priority. Clearly, it may not be prudent to hop on a plane and take your team there tomorrow but monitor the situation. Get status updates and re-entertain the possibility 3 months, 6 months, and 9 months down the road.

In the meantime, for your next team building session or corporate event, have a fundraiser or assemble packages with clothing, blankets, diapers, thermoses, canteen bottles, bottled water, non-perishable foods, flashlights, surgical masks, band-aids, bandages, disinfectant, toiletries, medical supplies, chainshaws, tools, nails, and school supplies.

It’s not practical to travel to deliver them at the height of a severe disaster or with a potential nuclear nuclear meltdown pending. In those situations, dispatch the supplies through a respected charity or the local consulate for that country. The information with this video has a list of organizations that can quickly get aid to areas that have been struck by disaster:

If travel to the area is possible, arrange for members of your sales team to personally deliver the supplies you have collected during a sales incentive trip and do it sooner rather than later.

Companies that really have heart can use disasters to transform their incentives and foreign retreats forever. If your team has special skills and expertise, why not dispatch a group to help with the clean up? The skills of construction workers, firefighters, medical professionals, mdeical social workers, helicopter pilots, and search and rescue professionals are all needed during periods of disaster.

What about snow plough operators, architects, landscapers, chefs, waiters, dieticians, and caterers. Food and beverage companies can send a team to a foreign destination to distribute some of the non-perishable items they manufacture. The team can spend part of its time at a resort and most of its time clearing debris, assisting with agricultural projects, digging wells, planting vegetable gardens, delivering supplies, distributing food, repairing local schools, and houses.

Making a difference when disaster srikes will be a truly rewarding experience for your team. It’s definitely a paradigm shift worth making.

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Incentive Travel: Reversing the AIG Effect

Incentive Travel & Event Planning: The AIG Effect - What Caused it & How Do we Reverse it?

by Anne Thornley-Brown, President, Executive Oasis International

It’s been almost a full year since my article “Should companies cancel incentive travel during a recession?” was printed in Incentive Magazine. In view of more hotel closures or bankruptcies that have recently been announced in Las Vegas, it’s  to re-visit this issue.

These issues are vital and have a direct impact on the economy. Please tweet about this article, link to it, reprint it, Stumble Upon it, and share it with every executive you know. Please also share the other articles and resources that I have listed. Please add your comments and join the conversation in the Q & A section on LinkedIn.

As we all know, a dramatic chain of events has had a devastating impact on the business travel, hospitality and team building industries.

What in the world were they thinking?

At least Morgan Stanley took the high road.

Morgan Stanley Won’t Entertain Clients at Its PGA Tour Event

We all know, what happened next.

The Reaction

Some of my colleagues blame statements like this by Obama for the problems that followed:

I see it differently. I agree with my colleagues that there is an important role for sales incentive trips, luxury corporate events, and recreational events for teams. However, I think that Obama definitely “hit the mark” when he said that the companies that accepted the TARP bailouts had no business planning lavish trips and corporate events. I believe that Obama, other lawmakers, and the media were justified in their comments and that they should not be blamed for the troubles that have plagued our industry. In fact, I have been sounding the alarm for years about:

  • companies behave as if they are country clubs and recreational centres rather than businesses
  • companies that opt for strictly recreational events as placebos and pacifiers rather than bonafide business team building to get to the root of the problem and generate solutions when they are having trouble
  • companies trying to pass off entertainment and recreation as “team building”

It’s a matter of remembering why we are in business, balance and priorities. I have been cautioning that an eventual backlash would come and we would see severe cutbacks in this sector. This is one time I wish I was wrong. The scenario that has unfolded is even worse than what I predicted.

The White House made its support for business travel clear:

So it is hard to understand the way in which some companies with a solid bottom line have responded to the criticism of AIG and other TARP fund reciplients. In a knee-jerk overreaction, even companies that are doing well and that had earned the right to reward their people have hit the panic button & cancelled incentive travel and retreats.

One of the most mind-boggling decisions in recent months was AXA’s decision to cancel its overseas incentive travel programme for the next 2 years in the same week that it received recogniition for its outstanding performance. Despite solid performance:

Axa Life head of events Patti Heaven, says: “From the perception of the greater general public, financial institutions are viewed very much in the same way as banks, which are not enjoying good media coverage. To host overseas incentives together with big production conferences in this global economic climate would create the wrong image. This would be insensitive and could potentially be interpreted as a lack of respect for individuals that have been made redundant.”

Sorry, I don’t get it. It certainly sounds like AXA events were WAY over the top and needed to be scaled back:

Heaven’s first foray into the events world was taking a group of 60 plus partners overnight to a hotel down the road. It was so successful that in the following years the event was held in Amsterdam, then Switzerland, Monte Carlo, Mauritius, the US and Bangkok.

“They just kept getting bigger, and more frequent,” says Heaven. ” And now there’s all kinds of different events every year, from conferences to product launches to overseas sales incentives.”

Events run by Heaven have always had an edge of excitement. She once found herself in trouble with Florida police after a mix-up with
passports as ID at a Miami nightclub. “I grovelled so much I made Uriah Heep look like Osama Bin Laden,” she says. “They loved it. Everything was fine then.”

Other stand-out events – but this time for the right reasons – include a recent incentive to Venice where the group had a private tour and recital at St Mark’s Basilica. “The tour was divine, although it was 35degC and we were all in black tie – tourists were taking photos of us,” she recalls.

“But the recital was electric. The room was dark except for candles. The music was extremely atmospheric. It was an amazing experience – it reduced some grown men to tears.”

Patti, what in the world were you thinking? A backlash to this type of excess was inevitable. However, to go from one extreme to the other – overkill to cutting incentive travel completely is a clear case of throwing the baby out with the bathwater. It makes absolutely no sense.

If anybody reading this is in touch with AXA executives or Patti Heaven, please share this blog with them. They are welcome to give their side of the story. I hope that someone from AXA will answer the following question that I throw out to executives from all companies that have decided to scale back despite the fact that they are doing well:

How do you expect the economy to ever recover if you don’t spend money and if you make decisions that are contributing to the deminse of many organizations?

Please don’t think I am just picking on AIG and AXA.  In one of my other blogs, I  have previously written about some of  the bizarre ways in which companies were spending money on recreational activities and passing them off as “team building.   The problem with corporate excess is that there will ALWAYS  be a backlash and innocent people eventually have to pay for the poor judgement of executives by losing their jobs.

The Consequences:

The latest:

Since we released this article, there has been another one:

Luxury hotels like the Ritz-Carlton have suffered from the backlash from the so-called “AIG effect.”

Just days after the federal government committed $85 billion of taxpayers’ money to a bailout of insurance giant American International Group (AIG) in September 2008, senior execs from the troubled company headed to the swanky St. Regis Resort in Monarch Beach for a week of wining and dining of 100 top salespeople.

The uproar was deafening.

“The whole demonization of luxury meetings and companies’ pulling back on having their high-end meetings in luxury hotels–. this has had a tremendous impact on Las Vegas,” Ritz-Carlton spokeswoman Vivian Deuschl reportedly said.

Last year, revenue for U.S. luxury hotels fell nearly 17 percent, outpacing the 14 percent drop in the overall industry, according to an analysis by PricewaterhouseCoopers LLC. Revenue per available room, a fiscal measure of health in the industry, plummeted about 24 percent, compared with a 16.4 percent drop for the industry overall.

Deuschl did not comment specifically on the Ritz-Carlton Las Vegas occupancy levels, other than to say it is lower than the company would like, but she did have an opinion about the ripples from the AIG effect.

Fallout in Canada

The AIG effect does have an impact on companies in Canada and around the world:

Still think AIG effect has no impact on Canada?

Here is the latest:


  • Inn at Manitou Closes Doors After 36 Years (Ontario)
    • Reversing the AIG Effect

    A Landmark study has revealed the ROI of business travel so there is no justification for companies that are doing well to continue to put the lid on spending in this area.
    PERFORMANCE LEVEL: Are overseas incentives bouncing back?

    It was the poor judgement of some corporations that triggered the AIG effect. It is the selfishness, short-sightedness and cowardice of other corporations that is prolonging it. Sound decision-making and decisive action can reverse the AIG effect.

    The time to act is now! So here is the bottom line:

    • If your company is in trouble, don’t schedule a luxury junket or corporate event. Instead, hire a consultant and have an on-site team building or brain storming session to generate solutions to your business challenges

    Here are some ideas and guidelines:

    • If your company is doing well, don’t cancel your incentive travel programmes or retreats.

    Ideas & Resources

    How to Add Value to Your Meetings & Other Complimentary Resources

    Let’s stop this madness before we do permanent and irreversible damage to the global economy. Your team has worked really hard, beat the odds and generated outstanding results. They deserved to be rewarded. Let’s learn from excesses of the past, reward teams and expess appreciation to clients in a way that shows good judgement.  At a time when there are so many in need at home and abroad, devote part of your sales incentive trip or retreat to a project that gives back to the community. Help boost the economy and save jobs by booking a sales incentive trip or retreat today.

    I join the following organizations in urging executives from companies that are doing well to reactivate their incentive travel programmes before even more hotels go bankrupt, more employees lose their jobs and companies in the hospitality and business travel industry are forced to close their doors for ever.

    Great minds think alike. It looks like this blog entry is timely. Just saw this in the current issue of Forbes:

    AIG Effect

    Executive Oasis International is a Toronto based consulting firm that helps organizations succeed even in the midst of turbulence. Core services include consulting and on-site facilitated business team building and off-site team building reatreats. They also offer incentive travel and corporate event planning to help organizations reward their people when business objectives have been achieved.

    You are welcome to reprint this article as long as you keep the by-line intact and ensure that all links are live.

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Rewarding Your Team Even During Tough Times

This post  was inspired by comments made by Marie Hunter on Tuesday, March 10, 2009, in her blog. It is a response to her questions:

Meetings, Events, Travel and Hospitality Industry: Leaders Needed, Marie Hunter wrote:

“When it comes to meetings, travel and entertainment, America is in a temporary state of gridlock. Headlines condemning corporate entertainment next to headlines about ponzi schemes and secret bonuses have caused public outrage and boardroom paralysis. This panic may be understandable based on the events of the past few months; but, the panic itself has dire consequences for the economy.

What questions should we be asking?
Now more than ever, corporate leaders, elected officials, regulators, industry associations, small business owners and salespeople nationwide are struggling to understand what is and is not appropriate when it comes to client entertainment and employee perks. When is it appropriate to spend money to recruit, educate or incent employees? A question that is not getting as much press, but that I would like to see on the table, is when, if ever can public companies allow employees to engage in entertainment practices that implicitly or explicitly condone gender bias?

Marie, I decided to take a stab at answering your questions and accept your challenge but my response became too long for  the comments section.

Before we begin, here is the White House’s position on business travel and meetings:

White House press secretary Robert Gibbs said President Barack Obama was not discouraging travel when he said last month that businesses receiving federal bailout money should not be taking junkets.
“The president believes it’s important to have a strong tourism industry and that it’s important that, as the president said earlier … that we shouldn’t retrench,” Gibbs said. “He would encourage people to travel.”

Gibbs said Thursday that the president was referring specifically to companies “that are getting large amounts of public funding.”

“The President does have great concern with public money being used for that,” he said. Gibbs added that the president’s comment was “very clear,” and passed on a chance to express regret.

So,  here is my take on your questions.  I encourage other management consultants, meeting and business travel professionals to respond to your challenge and answer your questions in their blogs. Since I am based in Toronto, I’ll be giving some Toronto examples but they can be applied at other locations.

 

How to Reward Your Team Even During Turbulent Times

What meetings and events do you feel should be green-lighted immediately and why?

When companies are in trouble, they should be spending THOUSANDS of dollars to bring in management and business team building consultants to help  them resolve their problems instead of HUNDREDS OF THOUSANDS of dollars on junkets and luxury events. Either through on-site meetings or off-site retreats at AFFORDABLE local venues such as community centres and conservation areas, consultants can steer organizations through a structured brainstorming process to identify:

  • cost saving measures and strategies
  • new target markets
  • new sources of revenue
  • strategies for improving efficiency

Depending on your location, here are a couple of ideas. These sessions can be offered at luxury resorts when the good times roll and conservation areas when times are tough. The content remains the same, the recreational components are the only things that change:

  • Wilderness Survival
  • Desert Survival
  • Arctic Survival
  • Visexecutaries - loosely based on the Apprentice, this session can be delivered at a luxury resort or a local community centre. When times are tough, the “task” can consist of developing a strategy to address some specific business challenge your organization is facing 

Save the lavish celebrations for when your company is back on track. In North America, we seem to want to party all the time.  Unfortunately, all too, often the emphasis seems  to be on strictly recreational events that organizations try to pass off as team building. Definitely we get far more calls for recreation and entertainment than consulting. This is quite surprising during a recession. People seem to forget that they are running businesses not social or country clubs. This bandaid approach is merely offering placebos instead of getting to the root of organizational problems and generating solutions.

What gender-related entertainment practices should be discontinued?

Strip clubs, male only golf clubs, etc. are highly inappropriate and they have NEVER had a place in a  corporate setting PERIOD!! Ditto for bringing porno movies to coroporate retreats and skinny dipping on the corporate dime. Grow up. You’re running a business not a fraternity house.

While we’re at it, it’s time to cut back on alcohol consumption and the open bars at corporate events for a while. This will save a bundle.

What constitutes lavish entertaining?

When companies are in trouble, they should postpone expensive events and partying until performance has improved. Focus instead on resolving business problems.

If everyone has worked hard and you’ve had a successful year, pull out all the stops. Lavish entertainment to reward employees and express appreciation to clients is perfectly in order when you’ve earned it. Depending on  your location, some ideas might include:


When is it okay to spend money on Employees?

Even when a company is facing a challenging year, it’s important to reward top performers, build skills and boost morale. The key is to gear the spending to organizational performance.

Hint: When a company is in trouble, more money should be spent on resolving business issues than on entertainment and recreation. Far too often, it’s the reverse.

How should recruits be entertained?

Again it depend on whether or not the company is performing well. If the company is facing challenges, you can still entertain recruits but choose a cost effective strategy such as:

If a company is doing,  well consider some of the options I’ve already listed and other luxury options like:

These are perfectly in order when a company is doing well.

If you’re located in the Middle East, a desert safari would be perfect. If you’re in the Caribbean perhaps a beach barbeque would work.

What other questions should we be asking?

I posted these suggestions on Marie Hunter’s blog. I’ll take a stab at anwering them now.

 What can companies that are having financial difficulties difficulty do to reward their people?

Companies can reward top performers and top performing teams and still provide a meaningful experience for hundreds of dollars instead of thousands of dollars. There is no need for gift cerfiticates starting at $1,000 per employee.  People seem to be lacking imagination.

Under $250 per person

  1. Give top performers gift certificates for spa TREATMENTS or a local Day at the Spa rather than spending a weekend away for a spa retreat.
  2. An overnight stay at a nice local inn with dinner and breakfast for top performers and their spouses.
  3. Get a corporate table at Polo for Heart or a similar event and invite top performers and their spouses.
  4. Dog sledding afternoon and lunch at a local inn or resort.
  5. Morning of horse riding and lunch at a local inn or resort.
  6. A day at  Canada’s Wonderland for top performers and their families.
  7. Seasons passes to Canada’s Wonderland for a family of 4.
  8. A day at the zoo for the top performers and their families.

Under $100 Per Person

  1. Dinner at a nice restaurant
  2. Afternoon Tea
  3. Movie passes for teams that have gone above and beyond the call.
  4. Theatre tickets.
  5. Concert tickets.
  6. Take a group of top performers and their spouses to the Royal Winter Fair including the horse show and dinner at the upscale restaurant that is on site every year.
  7. Get a table at the gala for tournament of champions.
  8. Tickets to local hockey, baseball or basketball games.

How should companies that are experiencing financial difficulty entertain their staff?

  • Picnics at a local conservation area
  • Christmas party – for heaven’s sake, don’t cancel the Christmas party. Insted, do it at a venue in the suburbs instead of a costly downtown venue. Consider using a community centre with an ice rink to save money and keep everyone entertained.
  • An evening at a comedy or improv club.

Anne Thornley-Brown is the President of Executive Oasis International, a Toronto based firm that regularly organizes incentive travel and executive retreats in  Dubai, Oman, Jamaica, Malaysia, Singapore, and Canada. They provide  one stop shopping service with  a  personalized approach to incentive travel for corporate groups of up to 40.  Customized itineraries include travel, transfers, hotel, tours, team activities, and special events.

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Keep Canada Meeting

Keep Canada Meeting Initiative

Do we need an initiative similar to the one the Americans have launched?

In the USA, incentive travel and meeting industry associations have started a “Keep America meeting campaign”. Do we need something similar?

South of the border, associations and leaders in our industry have “got their game” on.  In response to the “AIG effect” that followed the Wall Street Meltdonw,  articles are being featured in newspapers and on association websites. Managesmarter.com is featuring a month long “Incentive Industry Survival Guide”.  There is a “Keep America Meeting” website and petition. Poweroftravel.org has a lot of valuable statistics about the contribution of the incentive travel industry to the global economy (statistics for Canada are missing). The site also has white papers and a transition section for Obama’s transition team.

Most of our tourists including our incentive travel business of foreign origin does come from the USA. It is said that when America sneezes, Canada catches a cold. So what goes on South of the border does have an impact on us. Yet in Canada, despite the fact that hotels are receiving numerous cancellations from corporate clients, we are hardly hearing a whimper about this.

I have personally contacted the heads of some of our associations that are involved in the meetings, incentive travel and retreat industries and suggested that we start our own “Keep Canada Meeting” initiative. I have not had a response to even one e-mail or voice mail, not even one.

So what’s up? Are we that different from our American cousins? Are we just too low key, conservative and reluctant to “make waves” to do anything proactive? Do we need a “Keep Canada Meeting” campaign? If we do, why are we not taking steps to launch one?