Navigating the Future of Business Travel

Transcript

Navigating the Future of Business Travel

Soundbites:

TOM: The travel sector is ripe for innovation, especially around AI

Theo Lau 39:30

AI can help us predict when it will be peak travel, when we might see more delays, cancelled flights. 

TOM: It can help with a company’s sustainability efforts

Shelley Fletcher-Bryant (23:55.698)

A big area where AI can certainly contribute to more eco-friendly travel practices is going to be around recommendations at the point of booking.

TOM: But there are challenges with AI’s access to traveller data

Tim Lebel (20:06.81)

The largest challenge we have with AI integration is going to be around trust.

TOM: On the flip side more data can help mitigate risk

Tim Lebel (34:48) We'll have so much data under our belts that our travel will be safer. 

TOM 

I'm Tom Parker, and welcome to the next five podcast brought to you by the FT partner studio. In this series, we ask industry experts about how their world will change in the next five years, and the impact it will have on our day to day. This episode looks at the travel sector, with a focus on corporate travel, and the innovations propelling the industry into the digital future, namely the adoption of AI and how it can streamline processes and help key environmental goals as well as the risks associated with technological innovations in a human centric environment. 

 MUSIC FADE

TOM:

After slumping during the pandemic, business travel is picking up pace: it’s expected to hit pre-pandemic levels this year with spending on it slated to reach $1.4tn in 2024.  But post-Covid, the landscape of corporate travel is changing, reflecting the evolving global economy, a diverse workforce and the growing importance attached to sustainability. 

The cost of travel is rising and businesses seeking to balance budgets need to find flexible tools for managing business travel and the variables and unexpected events, such as flight delays, that come with it. New innovations are becoming even more influential in the decision-making processes, such as what form of meeting or collaboration justifies the need to travel in the post-pandemic era. 

The whole sector is ripe for innovation and new technologies such as AI present a timely opportunity for companies to rethink their approach to business travel.

Shelley Fletcher-Bryant (02:56.274)

I think the travel industry has a way to go in catching up with some other sectors, but there's huge scope and potential. 

TOM: This is Shelley Fletcher- Bryant, Vice President of Advito, a travel consultancy firm

And in terms of why it's really ripe for innovation now, I think we've seen a big return to travel post pandemic. We've seen a big increase, both from a leisure and a business travel perspective, we have high expectations about what that travel experience should be like

Shelley Fletcher-Bryant (00:33.674)

Some of the key areas really are around efficiency. So improving both the experience on the travel company side, but importantly on the user side as well. So from the business traveler perspective, AI can be a really powerful tool in helping to enhance that user experience, providing personalised recommendations, systems and processes that really enhance the end-to-end process from booking a trip to actually being on a trip. 

Shelley Fletcher-Bryant (03:56.028)

Let's say when you work for a company, you have certain parameters that you have to work within. You are normally told what booking tool to use, you're potentially told what suppliers you can fly on. There's lots of different components within your policy and I think that the integration of AI into travel is really going to help travelers make those booking choices more quickly, more  easily and it’s going to streamline the process so that 

that they can easily identify what's in policy, what's out of policy, and more broadly, what those impacts are from a cost perspective, from an environmental perspective. So lots of good potential within the industry.

TOM: Enhancing efficiency and convenience for business travellers is one benefit, but risk management is a major area where transparency and understanding big data sets quickly is paramount. 

Tim Lebel (18:23.902)

So the way AI can be utilized in travel software to help mitigate risks, there's kind of three core areas in there.

TOM: This is TIm Lebel, Vice President and Head of Product for SAP Concur Spend Solutions

One is about prevention and planning. So many times just getting more awareness about what is going on, AI can be utilized in that to find out what's going on, current events or summaries or summarizing thousands of other travelers' information from their recent trip to that location can help provide that information comprehensively to you and summarize.

The second is about awareness, which is kind of taking things like real-time alerts and travel information and safety and providing mechanisms to contact the travelers directly and automatically. Again, where sometimes you're relying on a person, this is where AI can be utilized to automate that process and be able to immediately let you know. And thirdly, it's going to be around responses. I mean, if anything does go wrong while you're traveling, missing passports, vendor vendors, or whatever, you know,

You don't need to know what to do next an AI powered tool can kind of prompt you on for your alternatives that you have available There and many of those alternatives will be automated alternatives instead of call this 800 number And if everyone leaves that same 800 number and that 800 number doesn't pick up or doesn't give you an answer You've really not solved anything back to my Like many of us would say when traveling, you know, we don't always get the answer we want just because of human.

TOM: Dealing with big data is not something a human can do as quickly as AI. But how we interact with AI as humans is important. 

Tim Lebel (07:49.606)

It is the biggest challenge we have at a company like SAP or any software company using generative AI, how to take advantage of that data. You want to predict the data for today, and then you want to predict the data over a week, and then you want to predict the data over a month, and then you want to predict the data five years out. It's the same type of models that are built in large language models that can do that with data.

How to harness that and produce a technology that is insightful and pleasing to work with for users is the challenge in front of all of us today. 

TOM: In the travel industry complex decisions still rely on human expertise and outdated technology such as green screen or rudimentary interfaces. This can lead to a best guest approach and the risk of negative outcomes.  

Tim Lebel (10:38.938)

so AI has the ability to be conversational first off. So a lot of our first experience with this generative AI is gonna be something like a chat bot, something like Co-Pilot from Microsoft. And that conversational AI is the first thing you can think about in terms of how human interaction can be replaced with some of the AI. How can AI get in the middle of that? And I think that would be the first interaction.

The second interaction is the ability to take that data and try a bunch of different versions of it and optimize for whatever you're trying to optimize for. And that's where the real magic would come: do you want to optimize for sustainability? Do you want to optimize for cost? Do you want to optimize for time of travel? And so that level of interaction with users is going to be different because AI can do them all at the same time.

Whereas if you're working with a person, you kind of ask them to run one model and you don't like the way it comes out, you ask them to run another model. And how many of those are frustrating or you're not getting the results that you're wanting? And just think about every one of those will be replaced.

I will not predict how long that will take. But every one of those interactions will be replaced by generative AI or some new generation of generative AI. And now think about the effects that will have on travel, travel industry, travel software, and how we approach that.

TOM: But there are risks to the integration of AI into travel, especially when it comes to the use of customer data.

Theodora Lau (14:23.399)

The biggest impact that you see from an AI application implementation perspective and the whole travel experience is it comes to check-ins.

TOM: This is Theodora Lau, Author, Public Speaker, and founder of Unconventional Ventures, a consultancy helping businesses drive innovation to improve systemic financial wellness.

Theodora Lau (15:58.398)

because you do want to have a good seamless travel experience. You don't want to have to deal with check-ins. You don't want to have to deal with people. Well, in a way that adds friction to what you're doing. So it goes back to from the point when you make a reservation, regardless of what means you do it, the mediums where that particular data transpire, who has your passport information? For example, in my recent travels, I tried to get a car. The app in Spain asked me to upload my passport information to validate my identity. My first reaction is, wait a minute, I just want to get from point A to point B. I don't know you. Why do I wanna upload my passport information? Because once it's gone, it's gone. So that in itself, although the original intent is to create a more seamless experience,

Theodora Lau (16:57.49)

It freaked me out. I ended up just flagging down the taxi. So there are those concerns when we think about, we wanna offer an easy, efficient experience for the traveler. To what extent can we provide the trust that we know we will be safeguarding the data in a manner that the exchange can happen?

TOM: Trust is a key part of the AI integration story in various industries right now and the travel sector is no different.

Tim Lebel (20:06.81)

I think that the largest challenge we have with AI integration is going to be around trust. It's going to be around the use of data. And when these AI models get so complex and work with so many large amounts of data, and then you start working in the corporate and business world, there's got to be a level of trust there where, you know, on your personal phone, if you have to give up a piece of information to get a map to the grocery store, you're probably willing to do that.

But a corporation is potentially giving up lots of information to a travel software component, and they're not sure how it's going to be used. So for instance, from a data perspective, corporate confidential data or PII data about your employees should never be transferred into a third-party system, and that is going to be a big fear of theirs. Also things like, will this data...

be utilised to train the AI models of yet another company. These are two of the biggest concerns that enterprises have brought up to us at SAP regarding our stuff. And I think it's on every software developer to build responsible AI. And we actually have a document called Just That and it is published on our website to let everybody know what we mean by responsible AI. And that includes protecting the data, assuring that data is protected, not allowing that data to be used by those other.

AI engines for modeling. And those assurances have to be made for corporations to trust the stock.

Tim Lebel (22:18.854)

Navigating that type of thing is going to be very difficult. Trust is something that is very hard from human to human, never mind throwing in an AI bot on top of that to determine trust. And so it's going to take a lot of discussion and trial and error within this industry to get there. People are going to take a lot of risks today with the speed at which AI moves, and not all those risks will pan out. We need to be diligent and...

and have a common approach to being good people on this earth and doing the right thing there.

TOM: Sustainability is an area of major focus for many industries. The travel sector is a hard to abate sector when it comes to emissions.  A key part of the decision making tree for businesses when it comes to air travel is the impact on the environment. Essentially, as Tim said, how can we be good people on this earth and do the right thing. 

Theodora Lau (04:26.558)

I think sustainability is on the top of mind for everybody, regardless of where we live. One in seven survey companies in the United States and one in five in Europe expect sustainability curbs to reduce their travel in a way, because now a lot of companies have to report that in the bottom line, this is how much of an environmental impact, if you will, of...

the activities that we do. And so we have to hold ourselves accountable. So that is becoming a corporate priority for many different organizations. And that plays into when we are going to take trips? Where are we going? And what else can we do to curb the impact of the environment based on our actions? And I think the other part along with that is impact to the bottom line, right?

A lot of us have gotten used to working from home. A lot of us have also moved away from where the corporate offices are. So that also plays into how we travel and where we travel.

Theodora Lau (25:35.)

I'm seeing more smaller regions get together in place of big events. I'm seeing more integration of hybrid digital approaches in addition to in-person gathering. So that nature has changed, but what we're trying to accomplish, bringing humans together, hasn't changed. And I think that is the one important thing we need to think about as we integrate more technology.

AI is a tool, AI is not magic. So as we're looking to put more of that to foster a better experience or a connection, keep that in mind is a tool to help us to bring people together, to make everything more efficient, to get a more streamlined or if you will, personalized approach to going from point A to point B.

TOM: Businesses and business travellers do have a huge amount of power when it comes to the sustainability of the travel sector, mainly due to purchasing power. According to PWC, business travel represents 12% of passengers, but up to 75% of profit for airlines on certain flights.

Shelley Fletcher-Bryant (12:00.002)

Business travel undoubtedly has a really important role to play here and certainly that purchasing power, putting influence on airlines is critical. And one of the biggest factors that we see in driving is encouraging travelers, encouraging individuals to book the more efficient option. Now, in very simple terms, the most efficient flight is the flight you don't take. So the best option is not to travel, people still need to travel and it's important that they find ways to do so effectively. Just an interesting stat that I think is worth sharing, I think it's one of my favorite stats around travel, is that when you talk about travel in general, not just business travel but combined travel, that only 1% of the world's population are responsible for 50% of the emissions. I mean that's crazy, that 1% of the population is responsible for 50% of the emissions and also that 80% of the world's population have never and will never take a flight. So when we're looking at driving more sustainable aviation and driving more sustainable travel we have to be clear that we're not talking about a global population change here. This is a change in a relatively small number of individuals which can make a huge impact.

And I was at a conference recently and a very interesting speaker, Dan Rutherford from the International Council on Clean Transportation, gave everybody a very strong tip that when you travel, you should travel like a nerd. And I really like this. So traveling like a nerd means that you first of all select newer aircraft. So aircraft like an A320neo or a Boeing 7878.

Shelley Fletcher-Bryant (13:57.836)

because while you still have to fly, you can choose a more efficient aircraft and those newer generation aircraft have around about a 15% lower fuel burn than older designs.

The second step in being a nerd is choosing the economy. Now this can be controversial because people like the comfort of business class, but ultimately if you fly in economy, then there are more seats. Generally there are fewer unfilled seats and therefore that means a lower fuel burn per passenger. The next step is regular. So looking at...

Those regional jets and large aircraft with four engines are very fuel intensive, but more regular medium-sized jets are more fuel efficient. And then the final step in being a nerd is flying direct. So choosing those direct routes, avoiding layovers wherever possible is a really good way to reduce emissions. So if business travelers and corporates start applying some of these principles as well when looking at their travel behavior,

TOM: AI can help businesses and individuals become that nerdy traveller, offering you information about your trip in real time to allow you to make the best informed decisions. 

Shelley Fletcher-Bryant (23:55.698)

A big area where AI can certainly contribute to more eco-friendly travel practices is going to be around recommendations at the point of booking. So making sure when those results are displayed, first of all, how are they sorted so that we can see the most sustainable option, if that's how we want the preferencing to be built.

Also providing some guidance potentially on whether you take the trip at all. So we shouldn't underestimate the need to prompt and remind people to consider their booking choices. So for instance, if I'm taking a one day trip out and back the same day, my booking tool should be challenging me to ask if I really need to take that trip or can I use a virtual meeting solution instead.

And then I think the reporting and insights is going to be really important. So the pre-trip guidance and then the post-trip reporting, what trip was taken on a traveler level? What were the emissions? Additionally, were there additional options that were presented and were not selected? I think understanding when people make choices, what alternatives were provided to them is also going to be really key as we move forward. So evaluation can be made on

whether it makes sense to choose a more sustainable option or if cost is still driving the choice.

And I think also when AI gets even smarter, we can look at recommendations to combine trips. If you're taking two trips over a two week period, is there a sustainable option to combine those trips? Is there an option to connect with a colleague who also has the same trip booked? And do you both need to take the trip? So taking the technology to look beyond what's being booked by that individual and looking more broadly

Shelley Fletcher-Bryant (25:49.712)

entire trip across the organisation and do 10 people need to go or could 2 people do that trip?

Tom: But AI isn’t the silver bullet here and has its own sustainability question marks.

Theodora Lau (41:54.638)

I would love for us to find a more sustainable way of running all these models. AI is fun. It gives us more interesting ways of doing things and re-imagining how we can do things. What we tend to forget because we don't see that it in itself has a huge cost associated with it. I'll give a quick example. The...

really cute Gen.ai tools that people have been using to create graphics. Each one of that graphic generated requires the same amount of energy as it will take to fully charge a phone. One graphic. So when we think about all of the data churning that is doing in the backend and we start thinking about impact to the environment, the need for water to cool down the

energy to run the service and a lot of them are not renewable energies. As much efficiency as we're gaining from the technology, what are we doing to the environment? That is the next big question we need to talk about.

TOM: The next five years with AI in any industry is a tough prediction, and the travel industry is no different. 

Tim Lebel (33:03.27)I've been involved in GEN-AI since it started at SAP, the speed at which we've moved in the last five months is truly, truly amazing. 

Tim Lebel (32:18.27)

The next five years is an interesting timeframe to look at with the investments we've seen in the latest AI models. Let me start by saying there's probably four areas where business travel is really affected by AI. The first is around those virtual assistants, the ability to have a chat pod or a chat experience, and then that conversational AI that's available.

Tim Lebel (33:30.16)

So where does this go in five years? At the speed of innovation today, these chat bots are not simply gonna predict the next words that come out or pull together cool paragraphs that answer your question, but they're gonna start doing reasoning. How we get there, I'm not sure. 

The second is around personal trip recommendations. Today, it's going to be expected that the recommendations are just spot on. It should never make a mistake. That's going to happen this year. We've got stuff I've seen in the labs that will be coming out this year on that. So what does that mean down in five years?

It's going to be the hardest one to predict. But what I will say is maybe travel will be fun and delightful again if AI can truly solve many of those frustrations that we experience. When I think about safety, we can do a better job of raising information today. And again, a lot will ship this year.

Tim Lebel (34:39.534)

to just make it a whole lot safer to travel? What does it mean in five years? It actually means actual safer travel. We'll have so much data under our belts at that point that we will be able to be assured that our travel will be safer. And that is, again, the promise of that one in a five-year timeframe. 

And then compliance and sustainability. Today, again, we provide insights. We can give you information to help you determine whether you're going to choose this flight versus that flight. And that's great. The power of choice, people feeling empowered. But predictive avoidance of anything that goes against compliance or sustainability efforts for that organization is where this is going. So a guided, but strict compliance to what the corporate policy is going to be. 

And in the five-year window, I'll give you one more thing to think about, which is that models will continue to consume data, and data growth is accelerating. Therefore, these models will get better at what they do today just by that nature in and of itself. In the meantime, the smartest people in the world are diving down into the algorithms behind Gen.AI, and they're building the next versions of generative AI, which we will likely see a new generation every 12 months. So in five years, five generations of a Gen. AI engine. It's gonna be like nothing we've seen before.

Theodora Lau (38:22.858)

I would like to see, and I think we might see, carbon footprint being added as part of KPI, where different departments will need to now report back up and be responsible and be held accountable for how much emissions that you have from your day-to-day operations, including travel.

38:47 When all the companies have a sort of responsibility, we are all part of the world, it needs to start from somewhere. And I do see travel being a place where it will play a big role. Uh, right now, the complications is how do you even go about tracking it? How do you even mandate it? Where should we start? So I believe that in the next few years, that is a great place that we're going to see some changes. I also see technology playing a bigger role in helping us plan our travel. 

39:30

AI can help us predict when it will be a peak travel time, when we might see more delays, canceled flights. 

39:58

For instance, in the upcoming events that I'll be going to, we'll need to book, we'll need to register for the event, we'll need to book for the flight, we need to book for the car, you need to book for the hotel. Many moving points. I see technology being able to help us and alert us, hey, you have booked these four out of five components. You haven't had a hotel yet or your hotel dates are not matching what you need. I mean, how many times do we go on travel and realize, oops, I messed up by one day. I've done that. Um, I was driving up to, to New York city and halfway through, I realized I've booked tomorrow instead of today. I would love to have a tool to tell me, Hey, maybe you should have looked, um, in a different way. So our day-to-day operations being a little bit more efficient, take the stress off from travel. So hopefully it can be fun again. I would like to look forward to that. 

Shelley Fletcher-Bryant (26:25.466)

So the next five years in corporate travel, I think are going to be very interesting. Shelley Fletcher-Bryant (30:40.174)

With AI, I hope that it can make travel seamless. I have a vision, whether it's real or not. It would be wonderful if when I arrive at an airport, I don't have to go to a check-in desk. There's some form of face recognition that knows it's me, that automatically checks me into my flight. I can drop my bag, print off my label. I can walk straight through security and go straight to my gate. And I don't need to show a boarding pass or a passport

ticket to get me on a plane. Now, there are also challenges and risks with that when it comes to privacy and my face being recognised around the world. But as we look at the evolution of AI and how that works with travel, I do wonder how long we will all have a passport in our back pocket for when we're travelling.

Shelley Fletcher-Bryant (26:33) 

We are quite early in our industry in the development of AI. Certainly when it comes to considering the role that AI can play in sustainability within the travel industry. But there's definitely a potential opportunity. I think reporting is going to be key. Reporting and insight is really going to help add a huge amount of value to corporates so they can understand where their programs are today, what their booking behaviors are, and then the next phase is going to be when AI gets smart enough to provide recommendations to promote different choices that from a traveler perspective make the booking process easier. We all want seamless, easy travel. So if my booking tool just provides me with two or three options, but they're the very best options based on my preferences

So they know that I like to sit in the aisle seat. They know that I prefer to fly from Heathrow. They know which airline is my preferred airline and what time of day I like to fly. And then the AI can provide me with the most sustainable match for that trip and automatically book that, share that with my network, make other people in my organization aware of that trip should there be others taking the same trip and encourage people to fly the most sustainable options. So I think the technology around the guidance is going to be really important. 

TOM: 

In 1901, Wilbur Wright said to his brother Orville ‘No man will fly for fifty years’. 2 years later the Wright brothers realised the world’s first sustained flight of an engine powered aircraft. What this shows is that even, over a century ago, predictions and advancements in technology are tough to fathom. The speed of AI’s advancement is beyond our imagination, so was flight back then. 

AI offers huge opportunities in the travel sector at a time when we all need it. Travel, since the pandemic, has highlighted new stresses for individuals and corporations. AI affords a more streamlined process across every part of the travel experience. It allows for more real time visibility of costs, risks and rewards. The growing concern for sustainability across a workforce, and reducing one’s carbon footprint, raises questions about our need to take flights. But when absolutely necessary, AI can analyse a range of considerations, identifying carbon offset flights and eco-friendly travel choices. 

But AI’s journey won’t be without chances of turbulence. As with any technological advancement, challenges and apprehension remain. With the access to invaluable personal travel data, trust must be at the core of AI’s adoption in travel. Data is key, businesses can make informed decisions and force change in the sector. If we adopt the correct approach to AI, the skies will be the limit!