John Rizzo is the CEO of corporate online booking technology provider Deem. He announced his retirement in November. This opinion piece is an excerpt from a longer letter to the industry that he wrote upon announcing his January 2021 departure.
It's become pretty clear to me that humans don't evolve and transform unless confronted with a crisis so extreme that we have no choice but to break from the status quo and change our context. A mentor of mine once said, "The path to heaven is on a route only through hell." I've found that to be the case time and time again.
The business travel industry is in hell right now, but I view that as a vehicle that transports us to heaven. The challenge creates an opportunity to transform and come out better and stronger on the other side. The industry was hammered by SARS and 9/11 and we came back. We will again. It isn't a surprise that technology is playing a bigger part in our industry every day. The bigger change is the rapid acceleration—by perhaps 10 years—of business model and technology modernization that we, as leaders in the business, should have embarked on long ago.
I'll illustrate through a personal anecdote going back to 1983 when I was on the Macintosh team at Apple. Steve Jobs often would walk the 20 feet from his office to my cubicle and, aside from a range of things that I can't repeat, would comment on the Macintosh packaging and user manuals. (I was responsible for the former, in addition to a long list of other things.) Finally, after making changes far too many times under an extremely tight deadline, I tried a different approach: I simply asked him why this was so important.
He said, essentially, "Your job is to stop the phone from ringing. That's because if the phone rings, any gross margin on the sale of that computer is wiped out." In effect, we needed to sell millions of computers in a way that our customers would be able to figure out how to use them on their own, with no other human intervention. This sharpened our focus and made it easy to make decisions that met the first principle: Don't make the phone ring.
Well, the business travel industry didn't get that memo. Up until the pandemic, the notion of travelers not calling an agent or having technology remediate problems without human intervention was not part of the industry's collective thinking. In many cases, it was actually frowned upon. Why? Because the whole industry was based, historically, on humans helping other humans travel. And many business models were built on paying for that human interaction.
Contrasting this with the modern internet platform economies, I'll pose a simple question: When was the last time you called Facebook? Or Netflix? Or Apple? The answer, more often than not, is likely "never," "never," and "never."
Thus, business travel technology is now forced into an accelerated transformation that mimics what we've experienced for a long time in our consumer technology lives. Software and technology that is invisible. Software and technology that allows self-service. Software and technology that anticipates needs and automatically personalizes an experience and solves problems. Software and technology that's with us always, that is, mobile-centric.
This is now a requirement for survival as the economics of a human-centric mode of reservations, problem solving, and remediation simply isn't economically viable in the age of Covid. What the internet and platform economy has also taught us is that anyone who sits between the buyer of the services (in this case, the traveler and their company) and the provider of the services (in this case, the airlines, hotels, and mobility providers) must add value or run the risk of being disintermediated and eliminated.
If a brick-and-mortar fulfillment business (in this case, the TMC) doesn't provide unique value to a shopper in a transparent, authentic way, then the shopper will buy direct, online, and the fulfillment business will be eliminated. If the distributor of goods and services (in this case, the GDS) cannot make all the goods and services available to the buyer that they can find through other sources, then the distributor will be eliminated. If the provider of software to book travel (in this case, the online booking tool) cannot offer a frictionless, transparent and broad choice of content to the traveler, then the software provider will be eliminated. In sum, all of us must add value or face the laws of Darwin.
The business travel industry needs to move on. Get with the program. Look forward, not back. Embrace the future. Be objective and brutally honest about our purpose and add value. If we don't, the market will deliver us a healthy whipping. The rest of the consumer tech world has embraced the notion of the consumer-centric internet platform economy in the palms of our hands. Let's do the same.