Over the past several weeks, I have noticed that a significant number of our clients have or are about to put a freeze on non-essential business travel. It almost feels like the early days of the pandemic, but the reasons are very different. Back then, it was a health issue, today’s travel freezes are to save on travel expenses and decreased productivity. 

 

In 2023, there are several categories of business travel including internal meetings at headquarters, customer meetings, training programs, product launches, recruitment and hiring, and HR-related meetings such as the retirement of a valued employee. 

 

From a purely business acumen perspective, let’s take a look at the travel costs of 3 unique scenarios. The costs are standard averages: 

 

Travel to Headquarters 

• Flight - $700
• Hotel (2 nights) - $600
• Food – 2 days - $200
• Miscellaneous - $100

Total - $1600 

This expense doesn't include travel time which is non-productive 

 

Typical Sales Meeting (big customer out of town) 

• Flight - $700
• Hotel (2 nights) - $600
• Food – 2 days - $500
• Miscellaneous - $200

Total - $2,000 

This expense doesn't include travel time which is non-productive 

 

Typical Training Event 

• Flight - $800
• Hotel (3 nights) - $900
• Food – 3 days - $600
• Miscellaneous - $300

Total - $2,800 

This expense doesn't include travel time which is non-productive 

 

Continuing with the math, think about these assumptions of a “typical” 40,000-person organization: 

• 4,000 people travel each month at an average expense of $1,800 = $7,200,000 a month
• Annualized, that is equal to about $86,000,000

That’s right, conservatively, a typical large organization can save over $86,000,000 just for travel, lodging, and miscellaneous expenses.  

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The headlines in the news that seem detached have a different impact when colleagues you have known, worked with and respected for their contributions in the workplace personally reach out to let you know their jobs have been eliminated and are asking for help networking and finding new jobs. Over the past week, I have had more people reaching out because they have been cut than I can ever remember including the early days of the pandemic.

By now, we have absorbed the data:

• 103,000 jobs were cut in January 2023
• Twice the amount cut in December 2022
• 440% more than in January 2022
• 41% of the cuts are coming from the high-tech sector
• Retail and Financial Services were the next largest sectors impacted

Literally, at the very same time these cuts were being announced and reported, there was an unexpected job hiring report that included:

• 517,000 new (non-farm) jobs being added to payrolls in January 2023
• The previously expected increase in payrolls for January 2023 was supposed to be 187,000 jobs
• Unemployment is at the lowest rate, 3.4%, since 1969 and you must factor into the appreciation of that number there were 30 million fewer people in the workforce in 1969

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We are now a full month into the New Year and I have noticed a significant and measurable decline in the approach and support of Customer Service.

To be more specific, we went back into the last 16 Business Acumen simulation sessions we have delivered for our clients to measure the trends of investments participants have made in the function of Customer Service to see if there was any data to support a thesis of continued diminishing investments leading to poor business performance. What we found was very interesting. During these last 16 Business Acumen workshops which include programs in healthcare, process manufacturing, financial services, and high tech, the average investment in Customer Service decreased by more than 28% across all participants and all workshops.

During the same time, we saw increases in investments for:

• R&D (32%)
• Marketing (22%)
• Sales (14%)
• Operations (2%)

This data got me curious, so we went back 5 years to a pre-pandemic environment to see what the data was. Unfortunately, we didn’t document the more than 400 Business Acumen programs we delivered in 2018, but I was still able to log into about 30 different simulations as a frame of reference and the average Customer Service investments were about +3.4% during a simulation workshop which typically averaged about 3 years of running the simulated company.

While not perfect science, a swing of over 30% is significant.

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Part 3 of 3 

Welcome back to the final installment of our blog series on Psychological Safety. You can access the other parts of the series by clicking on the appropriate links below.

• Psychological Safety in the Workplace: Impact Leaders Have on Culture
• Influential Leadership Tips to Enhance Psychological Safety in the Workplace

In part three, will conclude the series with a discussion on practical actions leaders can take to enhance psychological safety in the workplace. Remember to take the self-assessment linked at the end of the blog if you haven’t done so already.

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Welcome to part 2 of 3 of our Psychological Safety blog series.  Last week we focus on Psychological Safety in the Workplace: Impact Leaders Have on Culture. Today we will dive back into the discussion on practical actions leaders can take to enhance psychological safety in the workplace. Remember to take the self-assessment linked at the end of the blog if you haven’t done so already.

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