Here are several suggestions for you to consider as you develop your own business strategy. You may decide that some comments don’t apply to you, or that your circumstances are such that you haven’t any choice but to proceed along other lines, but each is worthy of serious thought. Perhaps you’ll benefit from a possible warning even if you’re unable to act on the specifics.

OVERREACTION IS CONTAGIOUS

As of this writing (September 18, 2001), it’s still too early to tell precisely what impact the week’s undeniable human calamities will have on the travel industry. Remember that the "ain’t it awful" folks usually get paid for saying what they do.

Airlines looking for government funds aren’t well served in that quest if they paint less than the bleakest possible picture. A non-stop diet of cable television news can easily, and probably does, drive people to despair, as graphic and painful images are shown repeatedly. Commentators, self-proclaimed experts, and other voices make news and gather the attention they seek if their message suggests we’re all inches from the abyss.

None of this is a sound basis for making business decisions. It’s a grave mistake to develop plans without data—and it’s simply too soon to know. The massive staff cuts announced by several major airlines are tragic, but people whose judgment isn’t flawless are also making them.

Neither business nor leisure travel is going to zero, or half what it was last year, or into any similar pit. Misguided investors were busy yesterday driving travel sector stocks toward the bottom while they moved videoconferencing issues higher, on the theory that business travelers would embrace that technology as an alternative to doing business in person.

It won’t happen. Today’s airlines have become the buses of the air and it is simply impractical for 21st century business to be conducted some radically different way than it was last week or last year. Major travel purchasers are issuing directive that their employees avoid "unnecessary" travel, but does anyone really believe they weren’t doing that already?

Airlines and agencies complain that travelers simply aren’t "coming back." To what? Until yesterday the public was so confused as to what was and wasn’t flying that it’s easy to appreciate why no one was making plans. The public is still confused. It’s simply too early to clearly understand what the pattern for the rest of 2001 will be.

Today’s wise business decision is not to implode your business based upon faulty or incomplete data—a decision you’ll surely regret.

THE TRAVEL INDUSTRY IS AMAZINGLY RESILIENT

I don’t know whether travel this year for all purposes will be down 5% over last year, or 10%, or whether it will be down at all, but the clear and unambiguous lesson of history is that quickly it won’t be down much. Overall travel not just in the U.S. but globally has not been down year over year even once since World War II. Over almost 60 years of grief, suffering, and global conflict the travel industry has shown that it can weather many things, and there is no reason to believe it will not do so now.

Moreover, recovery from downdrafts is almost always very quick. The most serious period of global travel disruption in the last 60 years was the Gulf War, and even then the industry grew by 3.2% over the prior year. The following year the industry rebounded and grew 13.5%.

The wise business decision is not to underestimate the efficiency of the system simply because someone else is spinning their "ain’t it awful" tale. When someone shows you why "this time it’s different" you can listen closely, but remember that those are the most fatal words ever spoken in business.

LESSONS OF THE GULF

The 1991 Gulf War seriously disrupted travel, tourism, and a number of other economic factors worldwide. In the U.S. there were fewer effects, but they were still present and many people at the time were vocal in blaming their difficulties on the conflict.

Were they right? Perhaps, but the downdraft caused by the Gulf War was very short-lived. The period of uncertainty prior to the conflict was worse in many ways. On the day the war started the so-called "Saddam Sell-Off" in stocks ended and the markets enjoyed one of their best days (in relative terms).

My point is that uncertainty is among the more serious problems, but it does not last forever. Some people have pointed out that the Gulf conflict had a definite end, whereas our present troubles may not.

Did it? Clearly we live with many of the same problems that were in place at the time of the Gulf War. There is a line of argument that says our present crises is but a continuation of events that began then or before, and decisions made at that time.

Finally, remember that then, as now, some people used world events as justification for business turmoil that found its spark elsewhere. This has always been true.

Again, the wise business decision is to recognize that it’s simply too early to tell what conditions will be like even in a few weeks. The affairs of humankind ebb and flow, and while we can learn much from past conflicts we should not assume that this predictor is always reliable, or that observers, analysts, and pundits draw the right conclusions.

PEOPLE PRINCIPLES

I’ve personally observed as frequently as I can that the single greatest problem facing the travel industry is people. This has been true for at least 10 years and it grows worse continually. The best and the brightest at all levels, starting with reservation agents and ending with senior management, have been exiting the industry far quicker than they are replaced. The pool of irreplaceable expertise that comes only through experience of all types is smaller every year, and regretfully it is treated with more contempt every day.

If there is a single factor that will degrade and devalue the travel industry and the business that operate within it, surely it is this talent flight. Regretfully, the extent to which travel businesses of all descriptions are willing to tolerate employees, managers, and senior executives who are clueless about the precepts and mechanics that make the industry work is truly astounding. They do so at the peril of their businesses, their value, and the investments of their owners and shareholders.

The natural reaction of most businesses in the face of economic trials, or usually even the threat of such trials, is to begin sacrificing employees. It’s too much to ask that businesses plan so that they could better withstand economic reversals or unforeseen calamities, but minimally managers and senior officers should understand what they’re doing.

Removing the heart from your business by casting your most valuable assets away should be the last step taken, not the first. Seeing things as they really are is among the most difficult projects humans undertake, but it is key to successfully managing business uncertainty and economic reversal.

The wise business decision is to eliminate projects, non-critical technology, unprofitable lines of business, or financial business and relationships that do not deliver what they could before contemplating an untargeted workforce reduction.

Some positions and people are less critical than others. You should develop a strategy for retaining the key skills and experience that can help your business survive. Business leaders must be strong enough to recognize what they are doing that is not successful and then take appropriate actions. Nowhere is the tyranny of numbers more evident than when this becomes the sole focus of business restructuring.

PLAN FOR SUCCESS

Many of the most successful people throughout history have reinvented themselves, their professions, or their businesses when faced with fundamental change. The wise business decision is to spend time planning, not alone but with trusted employees, counselors, or experts who may be available to you, as to how your particular business situation is likely to change based upon "seeing things as they really are."

The result may be that you can reinvent yourself and focus upon lines of business or products that are best likely to succeed. This may not be practical, but until you have gone through the exercise, you do not have enough information to make appropriate decisions.