Arnie Weissmann
Sitting next to Roger Chen, chairman of Carnival China, on a two-hour flight from Guangzhou to Sanya provided me with insights into the evolution of what is expected to become the world's largest cruise market.
And as a bonus, I received a lesson in ancient Chinese philosophy, which, it turns out, is intimately connected to that evolution.
Chen, who was a diplomat and held senior positions with Microsoft, General Electric and Volvo before joining Carnival Corp., said that central to China's development as a country is the understanding that change is an operating principle. Citing a tenet implied by the centuries-old Tao Te Ching, a text of spiritual wisdom, he said, "Out of nothing will come something, and out of something will come nothing."
Chen also explained that understanding the pull/push flow of energy that underpins tai chi, a movement-as-meditation discipline practiced throughout China, is essential to developing a business.
Perhaps so. State-of-the-art passenger terminals were built in ports along the country's coast in anticipation of a robust cruise market.
Out of nothing came something.
They were constructed, however, with capacity that far exceeded the then-current inventory of cruise ships plying Chinese waters. Ultimately, for many of those ports, out of something, nothing.
But change was also factored in. The ports began to compete, spending even more money to improve facilities to lure the lines. The port administrators, Chen said, realize that if successful, they will see a return on their investment sooner than if they are idle, so putting more money into efforts to woo the cruise lines was an acceptable price to create the change they envision.
Meanwhile, the lines themselves are also feeling the pull and retraction of chi, the energy that many Chinese believe sets the rhythms of life. To better illustrate the real-life impact of the flow of chi, Chen referenced discussions that had taken place at Travel Weekly China's CruiseWorld the day before in Guangzhou.
The history of the modern Chinese cruise industry really began just three years ago. With much fanfare and personal attention from the C-suites of major global cruise companies, China was declared a priority.
A joint venture between Royal Caribbean Cruises Ltd. and the Chinese OTA Ctrip created SkySea, the first Chinese cruise line.
At Carnival, one of Chen's first tasks was to form a joint venture to create a shipyard that would increase global shipbuilding capacity in anticipation of a burst of extra demand.
Norwegian Cruise Line announced the first ship conceived and built for the Chinese market.
Out of nothing, something.
But the retracting forces of chi created figurative and literal headwinds in the form of typhoons that forced cancellations. An outbreak of disease put limitations on South Korean ports of call, and then an outbreak of geopolitical friction shut down Korea as a destination entirely. A significant percentage of attractive ports within reach of the four- and five-day cruises, the norm out of Shanghai and Tianjin, disappeared from itineraries.
Out of something, well, not nothing, but certainly voids that needed to be filled.
And a young industry is finding ways to fill the voids. There are experiments with longer cruises, up to nine days on Royal Caribbean, to visit ports in Southeast Asia that are beyond the reach of shorter cruises. Some ships were moved to homeport in southern China for the same reason.
As a side effect of the disruptions, the gap began to narrow between the traditional distribution method -- ship charters by large travel agencies -- and sailings managed by cruise lines and sold through agencies on a commission basis. That was an evolution that the lines, by and large, sought in the Chinese distribution model.
To be sure, cruise and other industries in Western countries have adopted the viewpoint that the only constant in life is change.
The recent evolutions in Chinese cruising are reminiscent of industry activity after 9/11, when some passengers were too frightened to board an airplane to fly to Florida to begin a cruise. From this challenge, the concept of diversified homeports was born. Fear of flying dissolved eventually, but popular and profitable homeporting continues.
That something comes from nothing, that something turns to nothing and that change is to be expected is ingrained in the Chinese world view. In the West, it has become a pragmatic, if not philosophical, understanding of how the world works.
But differences remain. For the most part, the West still waits for challenges, then reacts. To truly anticipate change, Chen said, is uniquely Chinese, and it provides a greater freedom to move forward while expecting circumstances to shift unpredictably. Regression is not viewed as a setback, but rather as guidance to new opportunities.
Every reader of Travel Weekly has created something from nothing.
A cruise line builds a ship, then a fleet.
A hotelier constructs a single property, then a brand.
A travel agent envisions a dream vacation, then brings it to life.
Everyone happily dives into the creative segment of life's yin/yang. The question is, do you as a businessperson calmly accept and expect that "something" will invariably be threatened by its counterbalance in life -- nothing -- and calmly, resolutely move forward?