In March 2020, as Covid-19 spread rapidly around the world, the cards seemed stacked against Airbnb. With lockdowns and social distancing measures in force, global travel ground to a halt and within eight weeks the accommodation-booking platform lost 80% of its business. The pandemic could signal the end of a 12-year successful run of the company. There were predictions that Airbnb may not survive the crisis.
In May 2020, CEO Brian Chesky’s letter to the company said “we faced two hard truths: 1) we don’t know exactly when travel will return and 2) when travel does return, it will look different.” However, for a resilient organisation, a crisis often becomes an inflection point for greater meaning and growth. Faced with tough choices Airbnb anchored its actions in their stated core values – ‘believing in the power of human connection to foster a sense of belonging’. The leadership of the company was clear not to focus solely on limiting damages to their own business and shareholders. While being decisive and nimble in the midst of adversity, the leadership asked themselves – for every decision made, was it humane, empathetic and compassionate?
They acted keeping the interests of all stakeholders – customers, hosts, employees, frontline staff and not protecting one at the cost of the other. For example, Airbnb offered a full refund or travel credit for bookings cancelled due to Covid. They scrambled to create a $250 million fund for hosts on the platform so that Airbnb could pay them 25% of what they would normally receive upon a cancellation. The decision to lay off 25% employees was mapped to future business strategy but was accompanied by extensive measures to care for those impacted. Under their ‘Frontline stays’ program, front line workers around the world booked more than 100,000 nights of free/subsidised accommodation.
In the following months, Airbnb noticed that occupancy rates were not in the negative and there was a significant increase in the demand for properties. As work from home became the norm, customers chose to rent accommodation on a long term basis in different cities/countries. As social distancing became a priority, people were more likely to rent private homes than hotels.
The result?
By July 2022, Airbnb emerged from what seemed a colossal setback, to record the most profitable quarter in the 14-year history of the company. This story of Airbnb speaks to The Core Questin’s robust and rigorous research-based Thrive Project. We have discovered the core dimensions of Leadership, Teaming and Organisation systems that make organisations future-ready, resilient under uncertainty, and poised for growth, and therefore set them apart from their peers.
Is your organisation thriving? We can help you discover where your organisation is on the spectrum of surviving-thriving and how to shift to a more thriving state. If you’re curious about this, we would love to tell you more, so please reach out.
