Travel beyond boundaries

When the World Travel and Tourism Council (WTTC) gathers for its annual summit in Dallas, it will be coming together "in interesting times," according to the organization's CEO, David Scowsill.

It's hard not to be reminded of the passive-aggressive (and apocryphal) Chinese curse, "May you live in interesting times." And based on the summary of topics Scowsill said would be addressed by the summit delegates, one might conclude that the industry has arrived at several critical junctures simultaneously.

David Scowsill

Among the issues to be discussed are safety and security concerns related to terrorism and cyberattacks, sustainability challenges and climate change, the instability of oil prices, the sometimes disruptive nature of technological changes and the geopolitical shifts that have resulted in, among other issues, large-scale migration.

Scowsill acknowledged these challenges, but he nonetheless pointed to signs that travel and tourism continued to grow "despite shocks to the system," and he said that these issues would be viewed at the summit within the framework of Travel Beyond Boundaries. His view could be summed up by another oft-repeated Chinese touchstone, that the symbol for "crisis" comprises the combined characters for "danger" and "opportunity."

This, too, is apocryphal, but it's nonetheless a potent description of how the industry has viewed and overcome adversity. Challenges frequently preceded periods of accelerated growth; it would appear resilience and reinvention have become core competencies of the industry.

Previous summits had emphasized identifying and defining challenges and opportunities, but the Dallas agenda will be a mix of deep dives on issues and solution-focused discussions. And in keeping with the Travel Beyond Boundaries theme, the roster of attendees and presenters reflects diversity in geography and travel sectors.

The WTTC's annual summits are held in locations around the world, but whenever it's on U.S. soil it draws a greater number of American members and speakers. This year's list of presenters includes an unusually large number of familiar boldface names (See a partial list, right). Politicians and ministers usually appear on the podium, as well, and the U.S. Cabinet is represented by Secretary of Commerce Penny Pritzker. Deputy Secretary for Homeland Security Alejandro Mayorkas will also be on stage.

(At past summits, some high-level government speakers, including heads of state, have shown up without advance notice.)

Several tourism ministers, as well as Secretary General of the United Nations World Tourism Organization Taleb Rifai, U.S. Travel CEO Roger Dow and Brand USA CEO Chris Thompson, are among the speakers who will discuss effective ways to generate public policy that supports travel and tourism.

The private sector will be given plenty of opportunities to present its perspective on travel and policy as well. Hilton CEO Chris Nassetta, who will speak during the opening session, told Travel Weekly it was important for the industry to make the economic case that travel and tourism contributes significantly to the GDP, and job creation and benefits society in general.

"A lot of [policy makers] didn't understand the impact that travel and tourism has," he said. "We have to educate them about the importance of making it easier to come here and easier to move around once you're here.

"And visas, visas, visas, visas, visas. Enhancing the Visa Waiver Program with sensible criteria both enhances security and promotes economic growth," Nassetta added. "It can be simple things like processing: Once we added more people to the consulates in China, we saw a 50% increase in business from China. When they extended Chinese visas to 10 years, we saw another 50% increase."

Open skies policies are another critical area, he said. "We have to fight very hard against any effort to reduce foreign carrier flights into this country."

His biggest concerns at this point are around infrastructure. "In lots of parts of the world, they're investing massively in infrastructure. Look at ours," Nassetta said. "It's a bit scary. We need to do a better job getting people around and making sure we have airports that work, rail that works, ports that work."

Assessing security risks

P.W. Singer

Adding to the industry voices are a chorus of outside speakers who will provide complementary expertise.

On the topic of cybersecurity, attendees will hear from P.W. Singer, a strategist and senior fellow at the New America Foundation and the co-author of "Cybersecurity and Cyberwar: What Everyone Needs to Know" (Oxford University Press, 2014).

As more operations become digital, risks rise in tandem with the benefits, Singer said in an interview earlier this month. "The Internet of things, where some 50 billion devices will be online, from phones to cars to planes to power grids, all linked together, is a perfect illustration," he said. "Criminals, terrorists and state-linked groups will pursue new vulnerabilities.

"Their goals may differ," he continued. "Is it to block the flow of information or to steal it? To cause physical damage? We have seen hotels and shipping companies targeted. In one case, the data of millions of hotel guests was sold on the black market; in another, pirates were able to target exactly where on a ship the most valuable assets to steal were located."

There is no quick fix for cybersecurity threats. "They need to be treated as a constant management problem, not just something for the information technology crowd to understand," Singer said. "It requires constant updating and check-ins by the entire management team, everyone from public affairs to human relations."

Companies should run through likely risk scenarios beforehand "to uncover weaknesses rather than letting the bad guys do it for you," Singer said.

Is there a real danger that the bad guys could, for instance, take remote control of an airplane, car or ship? "We have seen test examples of hacks like this," Singer said. "None in the real world, though someone recently showed at a cybersecurity conference how to hack the most popular police drone in the world.

"As we automate more, the risk does go up. The key finding of these tests is that security wasn't being taken seriously enough and that many systems were linked that shouldn't be."

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The effect of peace on tourism

The WTTC also commissioned the Institute of Economics and Peace to conduct a study to gauge the link between tourism and peace. Steve Killelea, the institute's founder, will present the findings.

He said there is a connection between "tourism sustainability" and countries that have a high level of peace and social development. "There is a relationship between the level of tourism [as determined by levels of tourism sustainability, tied in part to arrival numbers] and low levels of violence within a society."

While that in itself is not a surprising result -- naturally, fewer people would be attracted to a conflict zone -- the institute also measured the impact of terrorism on tourism and the length of the recovery period.

"You get a 40% drop [in tourism] in the year after a terrorist attack," Killelea said. "Then it bounces back. Within five years it is back to the same level of tourism as if [the destination] had not been targeted."

Steve Killelea

Looking at the level of violence overall, the world has become a slightly less peaceful place in recent times, he said. "Scandinavia, Japan, Australia and New Zealand have a high level of peace," he said. "Looking at Europe: France, Germany, Italy and Spain, all have seen spending on military drop 40% as a percentage of GDP [vs.] in the 1950s.

"But if you look at the bottom end [of countries based on tourism arrivals], those most affected by violence and conflict have deteriorated dramatically."

The overall worldwide economic boost that peace gives to tourism's contribution calculates to 3% of the GDP for a nation, but the cost of violence is a 13% drop, he said.

"Does peace create tourism, or tourism create peace?" Killelea said. "They're highly correlated, but one doesn't lead to the other. One feeds the other. Tourism employs a lot of people and brings money into an area, and that leads to better education, better nutrition, better health. The increased wealth of a society then contributes to tourism.

"There's a virtuous circle created between tourism and the underlying peaceful environment."

Is the connection between peace and tourism unique to the industry, or does it correlate with any business sector within a country?

"Some industries are negative," Killelea said. "A strong arms trade is negative. And [the exploitations of] natural resources are massively capital intensive, involve a high level of mechanization and has limited employment opportunities. The products are consumed offshore, and the government is the primary beneficiary through royalty taxes.

"So it varies by industry. One benefit of tourism is that it provides opportunities for small businesses, and benefits can go directly to the people. Peace gives payback, and peace and tourism mutually reinforce."

Among the other speakers from outside the industry will be Jeremy Rifkin, an adviser to the European Union and president of the Foundation on Economic Trends, who will examine the technology-driven evolution from centralized, proprietary and highly controlled businesses to ones that value transparency and lateral economy of scale.

Fabien Cousteau, the grandson of Jacques Cousteau, is an aquatic filmmaker and oceanographic explorer, and he will tell the story of his 31-day, underwater experience and how his Plant a Fish foundation is working to plant one billion oysters in the Brooklyn, N.Y., area.

Also on the agenda is Raisuddin Bhuiyan, founder of World Without Hate. Bhuiyan, born in Bangladesh, came to the U.S. to study, and while working at a gas station was shot in the face by a white supremacist in 2001. The story of Bhuiyan and his ultimate relationship with his assailant is a case study in how education and forgiveness can overcome dangerous prejudices.

Karen Katz, the CEO of Neiman Marcus Group, will address delegates to underscore the importance of shopping to travel and tourism.

Groundbreaking models

Michael Levie

Among the industry speakers who aren't immediately recognizable names -- at least, not yet -- are new entrants with groundbreaking models. Michael Levie, the CEO of the Dutch six-property chain CitizenM Hotels, applies cutting-edge technology in both his back-of-house and customer-facing operations in New York, Paris, London, Amsterdam, Glasgow and Rotterdam.

Levie likens his pricing/yield management systems to a brokerage house, and his rooms to equity shares. Prices change minute by minute, depending upon demand.

"We are trading in real time," he said.

It's unlikely large hospitality companies would adopt the model; it works in part because CitizenM has almost no contracted group or corporate rates, so that revenue on almost every room is based on flex pricing.

In the CitizenM hotels, technology is consolidated by a fully functioning iPad in every room. Not only is it a pathway to the Internet, but it also controls window treatments, lights, temperature controls, the television and music. The wireless is free, with an access point in every room; video is free and on-demand; and phone charges are tied to Skype rates.

But with all of this technology, is the human service element, assumed to be the heart of hospitality, lost?

"We highlight technology but have [a] very high touch level," Levie said. "You can check in at our kiosks in under two minutes and check out in 20 to 30 seconds, but our staff are trained to be ambassadors who are welcoming people into their homes, and our guest satisfaction on TripAdvisor and online travel agencies is very high."

There will be a lot of ground covered at the day-and-a-half summit; the summary above is not a comprehensive list of all the speakers and topics. Scowsill said, "We will be tackling all the major issues currently facing the industry."

Interesting times, indeed.