Wednesday, March 6, 2013

Out of the Box 13 - Why follow mega-trends?

by Renton de Alwis

As for human kind, we have ignored Gandhi, the Mahatma (like Martin Luther King Jr. once said not to), for too long and at our own peril. Even in his own land of birth, India, there are many who think and hold that his philosophy of ‘need before greed’ to be anti-development and reactionary. Yet, we have enough scientific evidence to point us to the ill effects of over development and the long term consequences of some of the needlessly greedy ventures we undertake in the process of what we call ‘development’. The area of tourism is no exception. You get too greedy and think of making merry in the short term, the long term will be bleak. Like in the story in verse of the crabs inside the heating pot, given in our literary classic, The ‘Lowada Sangarawa’.

This ‘Out of the Box’ column was written in April, 2010, and published in the ‘Financial Times, Sri Lanka’. My intent is to repost it today for your critical thought. For you to examine how we as a nation, banking on our tourism offer to the world at large, may be examining the mega trends we observe on the demand side, to get our supply side of the equation right.

 
Like for all else, tourism demand for a destination like Sri Lanka, bent on seeking a better brand of tourism from that of the past, will be shaped by two key factors. They are primarily, our ability to identify opportunities arising from the changing demand for the destination shaped by global mega-trends and our ability to effectively anticipate and meet that demand by having the right products and services in place. This serendipitous land has a myriad of natural, heritage, cultural and human resources that can be presented in various permutations and combinations. Creativity and innovative ingenuity of those who are putting them together is what will count, in determining the success or failure we shall have in seeking better custom, higher yields, enhanced profitability and benefit to host communities, ensuring the sustainability of our resources. 

I read about plans for mega resorts talked about, with somewhat of a bang-bang approach. Institutional memory of the past and the nature of the mega-trends identified for tourism by many research and academic organizations, I believe, need to be examined as we take on to shaping our new tourism future.  

I am also of the view that it would be prudent for us to take a deep-breath before we rush into the numbers game in building resorts and hotels. That could end up with us having more of the same and too many that need be managed in times of crisis and downturns in demand. We must also not forget that there is a dire need to refurbish and upgrade existing facilities, through which Sri Lanka could gain better yield, than attempting to attract more of the same low-end demand with more and more building.

Today, fresh options and innovations are available in providing tourist accommodation facilities that are more fitting for an exotic destination such as ours in meeting discerning demand.  Already our villas, boutique hotels and home stays are being talked about for their charm, quality, personalized service and functionality. These together with tented camp style resorts in the wilderness, may well be the future way forward for us, for it offers an opportunity for members of the community to participate in providing tourism accommodation as owners or key stakeholders, to bring higher yields. These can replace the rapid gains, middleperson centric business model of ‘build-sell-manage’ to the more sustainable ‘owner-build-manage’ model where direct stakeholder benefits can be had.    

There is indeed a need to meet the immediate demand for accommodation, especially in the North and the East. This includes both domestic and international tourism demand. Given the potential tourism has, for national integration; here too, home stay and cluster accommodation concepts can be actively pursued as options with effective participation of the people of these areas. The Diaspora and financial institutions must ensure that we adopt business models based on indigenous ownership that also meet the socio-cultural sensitivities of a people, now on their way to rebuilding their lives. It is true that these will not be possible to be set in place in a few months. In my mind, what would be more important is to get things right with good thoughtful planning, rather than rushing into things that can go terribly wrong.

The key focus should be on what form and creative shape, these facilities should take in meeting the new demand we desire to have. We need to look at this post-conflict scenario as an opportunity to venture to change the course of our tourism future aiming at a long-term solution that is sustainable and profitable for Sri Lanka and all her people. It is here that we need to take heed of the mega-trends that in effect are home truths of what is to come.

A recent study carried out by Credit Suisse based on a representative process of consultation have identified three key mega-trends, that would have an impact on tourism as well as all other business activities in the future. They are 1. Aging of populations and the opportunities it offers; 2. a multi-polar world where new and innovative products are sought and presented and 3. a move towards a green future, where alternative energy sources, food security and sustainable life styles will be sought, with robotics and nanotechnology assisting to cushion the impact of that transformation.

In addition, the UN World Tourism Organization’s 2020 mega-trends have identified 15 aspects that will impact on tourism’s future. The first among them is that future tourism demand will move to be activity oriented rather than destination oriented. This means that, no matter what mix of resources a destination holds; how they are blended to provide awesome experiences for tourists and travelers is what will matter.

In my future columns, I plan to further explore each of these mega-trends in relation to what they would mean for Sri Lanka’s tourism future.   

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