Some people like to travel and will find ways to travel on the companies dime. Others feel that the only way to truly meet with customers, is face-to-face. I have had to travel on and off for the various positions that I have held, but I always do it reluctantly. In the 1990’s there were people in the company where I worked, that would fly from Canada to Melbourne Australia for a one hour meeting and then get back on a plane to fly home. I can tell you from personal experience that it is a very long flight and it takes at least a day to recover from the travel and to adjust to the time change.
So to make that one hour meeting, a person would have to spend three days minimum away from the office and two of those days would be in a cramped airplane or an in-transit lounge. The meetings were almost always less productive than expected and the cost was three to four thousand dollars (Even back then). In the 1990’s people believed that this was the cost of doing business a half a world away. The company in question was successful so it’s hard to argue that there could have been a better way.
Several decades later I found myself in a start-up doing similar things and as a lower level employee, it was not my place to point out how expensive it was to do business on the other side of the planet. I think that the feeling at the time, was that Asia was the future and that to have a presence there was worth the expense. With 20-20 hind sight, I can tell you that it was not worth the effort.
Rule of business: If you can’t make a go of it in your own back yard,
going global is not a going to make things better.
In this day and age it is less likely that travel is really necessary. More and more businesses are using tools like Skype and various other forms of video conferencing to avoid long costly plane rides. At the highest levels of companies people are still traveling, but I am not convinced that the amount of travel is really necessary. The way we do business is changing and it’s for the better. Younger companies are cutting out travel completely and it is effecting their bottom line in a very positive way. With less money spent on sales and marketing travel, there is more money to mine the web and create a very low cost global presence.
I recently toured a boot strapped start-up that had nine sales people out of a total staff of 40. Their travel budget was zero and they managed to double their sales the last three years running. The company in question didn’t have a costly visual communication system, they just had a really good Internet connection, good web cams and used Skype.
So my advice to investors going forward would be to stay away from companies that are not able to make the transition away from large travel budgets. I would encourage all board members to ask pointy questions before approving the budgets of the companies they are responsible for. I encourage those who must travel to make sure it is absolutely necessary and to make travel pay. By that I mean weight the cost of the trip against actually sales that could not have been won otherwise.
The world of tech start-ups is one where every dollar has to count and I would suggest to you that travel is no longer a necessary expense. This does not mean that product managers and sales people should not meet with customers several times a week. I believe the exact opposite. If sales people and product managers are not constantly in touch with customers they are probably not doing what you are paying them for. Meet with customers locally or by video.