THE WORLD IN 2OO6 Business trip index 1

The Economist Intelligence Units business trip index

The Economist Intelligence Unit has developed a new
way of assessing and comparing locations as potential
venues for business travel. It takes into consideration
both cost-related and environmental factors, which
together form an overview of how desirable a destina-
tion is likely to be to the business traveller. The index
looks at 127 cities worldwide. This note explains the
methodology and gives the overall ranking and rating
for each city.
Per diem rates
The traditional method that companies use for com-
paring business-trip destinations, for the purposes of
assessing their costs, is based on the calculation of a
per diem rate for travellers. This takes a basket of
goods and services typically required during a short
business trip in any given destination. Items are usually
selected, priced and calculated into a daily rate or al-
lowance designed to sustain the traveller for the length
of their trip.
This purely nancial approach has become the most
common benchmarking model used to compare desti-
nations for a short business trip.
The use of per diem rates stems from the long-held
perception that the client, rather than the location itself,
is the main reason for taking a trip. Per diem rates are
a relevant benchmark for calculating a daily allowance
for necessary travel to a given destination, such as for
sales trips.
Contrary to popular perceptions, however, business
travel is no longer driven primarily by this consid-
eration. The reasons for business travel are increasingly
varied. Surveys have shown that conventions, training,
corporate meetings and seminars now account for a
greater share of business travel than client meetings.
What is more, a large proportion of business travellers
(exceeding half in some surveys) try to combine busi-
ness travel with leisure time, such as vacations.
As a result, it is apparent that a more versatile ap-
proach is needed to assess destinations for the needs of
the business traveller.
The business travel indicators
Cost still matters, naturally. Prohibitive costs can be
a disincentive to take a trip. But it is clear that other
factors also play their part in making a business trip
attractive, in terms of both comfort and convenience.
The Economist Intelligence Unit has drawn on its pre-
vious liveability surveys to assess aspects of lifestyle
and infrastructure that are relevant to a business trip.
We selected ve broad categoriesstability, healthcare,
culture & environment, infrastructure and costmade
up of a total of 31 sub-categories. In each case a rating
of 1-5 was assigned to an individual factor: a rating of 1
would present no problems at all to the business travel-
ler; 5 would present extreme difculties.
For qualitative factors (for example, the availability
of good hotels), the Economist Intelligence Unit has
drawn on the expertise of its global contributor network
to assign a rating of between 1 and 5. These were then
assessed by our analysts in London and a nal rating set.
For quantitative factors (such as taxi costs and distance
to the nearest airport), bands were set to assign a rat-
ing: for example, the per diem scale saw a rating of 1
assigned to any daily rate under $250 and a rating of 5
assigned to any daily rate exceeding $1,000.
When assembled together, these various factors were
weighted and calculated into a rating of 0-100, whereby
zero would represent an ideal business-trip environ-
ment and 100 would suggest an intolerable one.
Of course, some trips remain necessary regardless
of location. And many matters, such as the length and
cost of ights, will depend on the point of origin of
the traveller. Different travellers will attach different
importance to the various considerations in play, such
as the buzz of a city relative to its safety. These rankings,
therefore, will not satisfy all tastes. Still, they provide a
useful basis for comparison.
2 Business trip index THE WORLD IN 2OO6
Categories and weightings
The business travel index comprises the following ve
categories and 31 sub-categories. Weighting is divided
equally between sub-categories, except cost (where the
individual weights are shown below):
1. Stability (weight 25%)
Prevalence of petty crime
Prevalence of violent crime
Threat of terrorism
2. Healthcare (weight 10%)
World Bank health indicators
3. Culture & environment (weight 25%)
Discomfort of climate to travellers
Social/religious restrictions
Culture
Food and drink
Availability of high-quality hotels
4. Infrastructure (weight 20%)
Quality of road network
Quality of public transport
Quality of regional or international links
Quality of transport links to airport
Distance of nearest airport
5. Cost (total weight 20%)
Low per diem rate* (weight 2.5%)
High per diem rate* (weight 2.5%)
Hilton-style hotel rate (weight 1%)
Intercontinental-style hotel rate (weight 1%)
Whisky at a hotel bar (weight 1%)
Two-course meal (weight 1%)
Simple meal (weight 1%)
Big Mac meal or equivalent (weight 1%)
Car rental low price (weight 1%)
Car rental moderate price (weight 1%)
Regular unleaded petrol (weight 1%)
Initial taximeter charge (weight 1%)
Taxi rate per kilometre (weight 1%)
Taxi ride from airport to centre (weight 1%)
International daily newspaper (weight 1%)
Daily local newspaper (weight 1%)
Time magazine or equivalent (weight 1%)
*The Economist Intelligence Units per diem or daily
business-trip rate consists of:
One nights accommodation in a hotel;
One two-course meal;
One simple meal;
Two 5km (3-mile) journeys by taxi;
One drink in the hotel bar;
One international foreign daily newspaper.
All of the qualitative indicators above were based on
a range of factors, rated between 1 and 5 in each city
surveyed by our global network of correspondents and
veried using in-house research.
The quantitative indicators can be broken down as
follows:
Healthcare ratings were decided using a range of up
to 13 indicators by country from World Bank data. From
these a nal score of 1-5 was calculated based on the
comparative performance of each indicator.
For the distance to an international airport, any
distance of less than 15 miles was awarded 1 and any
distance over 60 miles was awarded 5, with equal inter-
vals in between.
The same minimum and maximum was imposed on
costswith equal intervals in between. All rates are in
dollars and are broken down as follows:
Low per diem under 250=1 over 1,000=5
High per diem under 500=1 over 2,000=5
Hilton style hotel under 100=1 over 500=5
Intercontinental style hotel under 50=1 over 250=5
Whisky at a hotel bar under 5=1 over 20=5
Two-course meal under 60=1 over 150=5
Simple meal under 25=1 over 100=5
Big Mac meal or equivalent under 3=1 over 12=5
Car rental low price under 250=1 over 1,000=5
Car rental moderate price under 250=1 over 1,000=5
Regular unleaded petrol (1 litre) under 1=1 over 2.5=5
Initial taximeter charge under 2=1 over 5=5
Taxi per kilometre under =1 over 5=5
Taxi ride from airport under 25=1 over 100=5
International daily paper under 2.50=1 over 10=5
Daily local newspaper under 0.50=1 over 2=5
Time magazine or equivalent under 5=1 20=5
THE WORLD IN 2OO6 Business trip index 3
Worldwide business trip index, 2006
1 4.60 Vancouver Canada
2 4.90 Calgary Canada
3 5.40 Toronto Canada
4 8.10 Adelaide Australia
5 8.40 Honolulu USA
6 8.70 Cleveland USA
6 8.70 Brisbane Australia
8 9.20 Perth Australia
9 9.50 Montreal Canada
9 9.50 Melbourne Australia
11 10.10 Pittsburgh USA
12 10.40 Sydney Australia
13 10.50 Atlanta USA
14 11.30 Vienna Austria
15 11.80 Boston USA
16 12.00 Minneapolis USA
17 12.10 Copenhagen Denmark
17 12.10 Zurich Switzerland
17 12.10 Stockholm Sweden
20 12.40 Geneva Switzerland
21 12.50 Washington, DC USA
22 12.60 Miami USA
23 12.80 Detroit USA
23 12.80 Helsinki Finland
25 12.90 Dsseldorf Germany
26 13.10 Auckland New Zealand
26 13.10 Wellington New Zealand
26 13.10 Chicago USA
29 13.50 Hamburg Germany
29 13.50 Seattle USA
31 13.60 Los Angeles USA
32 14.00 Luxembourg Luxembourg
33 14.20 Singapore Singapore
34 14.80 Berlin Germany
34 14.80 San Francisco USA
34 14.80 Houston USA
37 15.20 Budapest Hungary
38 15.40 Frankfurt Germany
39 15.50 Hong Kong Hong Kong
40 16.10 Oslo Norway
41 16.30 Paris France
42 16.40 Tokyo Japan
43 16.50 Lexington USA
44 16.90 Brussels Belgium
45 17.30 Dublin Ireland
46 17.60 Barcelona Spain
47 17.80 Madrid Spain
47 17.80 New York USA
49 17.90 Osaka Kobe Japan
50 18.10 Amsterdam Netherlands
51 18.50 Lisbon Portugal
52 19.00 Munich Germany
53 19.10 Reykjavik Iceland
54 19.70 San Jos Costa Rica
55 20.00 Athens Greece
56 20.30 Manchester UK
57 20.70 Lyon France
58 21.00 Prague Czech Rep
59 21.10 Bratislava Slovakia
60 21.70 Seoul South Korea
61 21.80 San Juan Puerto Rico
62 21.90 Buenos Aires Argentina
63 22.20 Beijing China
64 22.80 Milan Italy
64 22.80 Tel Aviv Israel
66 22.90 Montevideo Uruguay
67 23.00 Taipei Taiwan
68 23.30 Tianjin China
68 23.30 Santiago Chile
70 23.70 Abu Dhabi UAE
71 23.90 Shenzhen China
72 24.30 London UK
73 24.90 Dalian China
73 24.90 Dubai UAE
75 25.40 Guangzhou China
76 25.80 Rome Italy
77 26.00 Shanghai China
78 26.80 Amman Jordan
78 26.80 Warsaw Poland
80 26.90 Panama City Panama
81 27.50 Bandar Seri Begawan Brunei
81 27.50 Lima Peru
83 27.90 Bahrain Manama Bahrain
84 28.30 Kuala Lumpur Malaysia
85 28.40 Belgrade Serbia & Montenegro
85 28.40 Bucharest Romania
87 29.30 Asuncin Paraguay
87 29.30 Rio de Janeiro Brazil
89 29.60 Kuwait City Kuwait
89 29.60 St Petersburg Russia
91 30.60 Moscow Russia
92 31.80 Bangkok Thailand
93 33.50 Manila Philippines
94 33.60 So Paulo Brazil
95 33.80 Kiev Ukraine
96 33.90 Tunis Tunisia
97 34.40 Istanbul Turkey
98 35.60 Tashkent Uzbekistan
99 36.00 Cairo Egypt
100 37.40 Riyadh Saudi Arabia
101 37.50 Mexico City Mexico
102 37.70 Jeddah Saudi Arabia
103 38.20 Al Khobar Saudi Arabia
104 38.80 Colombo Sri Lanka
105 39.00 Ho Chi Minh Vietnam
106 39.60 Johannesburg South Africa
107 39.70 Quito Ecuador
108 40.00 New Delhi India
108 40.00 Mumbai India
110 40.40 Baku Azerbaijan
111 40.60 Pretoria South Africa
112 42.50 Hanoi Vietnam
113 43.40 Caracas Venezuela
114 44.90 Jakarta Indonesia
115 45.10 Tehran Iran
116 45.20 Nairobi Kenya
117 45.40 Guatemala City Guatemala
118 47.00 Phnom Penh Cambodia
119 47.10 Bogot Colombia
120 49.00 Abidjan Cte dIvoire
121 49.60 Harare Zimbabwe
122 51.60 Douala Cameroon
123 55.10 Algiers Algeria
124 56.10 Dhaka Bangladesh
125 58.40 Karachi Pakistan
126 62.30 Lagos Nigeria
127 62.90 Port Moresby PNG
Rank Rating City Country Rank Rating City Country Rank Rating City Country