Profiles In Travel Management: JPMorgan Chase

Globalization Amid Consolidation

Company: JPMorgan Chase

Headquarters: New York

2003 U.S. booked air volume: $84.5 million



The perfect travel program exists only in textbooks. In the real world, the truly great programs are a triumph of pragmatism over Utopianism, of finely worked balance between the needs of employer and employee and of rapid reaction to the constant changes that challenge all participants in corporate life. Add a global dimension to the equation and the complexities multiply, but so do the opportunities to extract handsome savings for the corporation. Such is the landscape surveyed by Judy Bauer in her capacity as vice president for global strategic sourcing of travel at JPMorgan Chase. The company has made huge strides in worldwide consolidation of its agency selection and its air and hotel purchasing programs, but Bauer makes it clear there is no room for complacency. The corporate culture at JPMorgan Chase is largely non-mandatory, and Bauer has to keep her project ticking through a constant input of hard data analysis allied with soft application of communications and cultural sensitivity.

The newly global program is settling in well, but nothing stays still. On Jan. 14, JPMorgan Chase announced a merger with Bank One to create the second-largest banking franchise in the United States and a payroll of approximately 164,000 employees. Inevitably, changes will have to be made to the travel program when the marriage is consummated, most likely this summer.

Fortunately, Bauer is as well equipped as anyone in the corporate travel game to cope with change. Her resume runs back to 1980, when she started a 14-year stint with American Express, including assisting the landmark consolidation of AT&T from 342 agencies to three. Subsequent employers have included Rosenbluth International, followed by a move to the corporate side, first with Lucent and later with Pharmacia. Both of these latter roles saw the ground shift unexpectedly and dramatically, with Lucent outsourcing its indirect procurement to the startup Alliente, and Pharmacia being purchased by Pfizer within days of Bauer's arrival.

Bauer arrived at JPMorgan Chase in May 2003 to find another organization in the throes of change. Still fitting together the last pieces of cultural integration between investment bank JPMorgan and Chase Manhattan in 2000, Bauer took over from a role that also had been outsourced, in this case to IBM.

IBM assisted JPMorgan Chase in the further globalization of its air program in April 2003, plus a hotel program featuring 640 properties. It also had started a global travel management company tender, which Bauer completed by handling the pricing element. The bank chose Carlson Wagonlit Travel to represent it in the United States and American Express in the other 13 overseas countries where it has a significant presence. However, two countries dominate its travel profile: the United States accounts for 60 percent of expenditure and the United Kingdom for another 27 percent.

The air program, which consists entirely of net fares, is working well across all 14 countries, including markets in continental Europe, Latin America and Asia/Pacific. However, it has involved some of those complexities and dilemmas that are not covered by the textbooks. For instance, and unusually for a large American corporation, the bank's biggest air supplier is foreign. JPMorgan Chase's major air route is New York-London, for which its chosen vendor is British Airways. "The competition is not happy we use them because overseas deals are often an adjunct to domestic ones," Bauer said. "However, Continental Airlines [one of the bank's main domestic airlines] doesn't fly from Newark to Heathrow, so it had to be."

With BA's lie-flat bed service in business class—permitted for JPMorgan Chase journeys above four hours—the company's travelers presumably are satisfied with the carrier as the transatlantic selection. On some routes within the United States, however, the need to limit the number of preferred carriers within the overall program inevitably means travelers cannot always use the dominant airline at their local airport.

This is where Bauer's communications program kicks in to explain the quid pro quo to travelers. In return for such benefits as flying business class, they have to fall in line on the question of using designated suppliers and booking through the same travel management company. Bauer backs this with hard facts, provided by Hi-Mark's data gathering solution and Eclipse Advisors' Dacoda route analysis program. "You have to educate people," she said. "We provide our lines of business with the data, and they do read it. What is most persuasive is when you can show them the quantifiable savings associated with carrying out certain actions, such as the millions of dollars we can save if we move to always taking the lowest logical fare."

Bauer also emphasizes the importance of channeling bookings through the same travel management company, as much for the security and tracking of the traveler as the consolidated data it brings.

She communicates through electronic newsletters and the bank's global travel Web site. The site is well used, something that Bauer encourages by directing traveler enquiries, when appropriate, to the relevant part of it instead of answering directly. However, firing off written communiqués remotely can never be the entire solution. The reason businesses have travel bills is because of the inescapable need to meet face to face, and Bauer is no different. She tries to see all country leaders every two months and visits the regions to listen to local concerns.

Bauer particularly is keen not to impose U.S.-centric solutions on other countries. She considers it vital to avoid making non-U.S. employees feel they are being compelled to spend their budgets on a program that does not represent their interests. Bauer achieves this, for example, by empowering the three U.K. members of her 12-strong team to act as regional managers. "They don't have to ask me permission for everything they do. They can deal with the cultural issues for the EMEA region," she said.

Cultural is not only a cross-border issue. The forthcoming merger with Bank One most likely will prompt further re-definition of the current program as two different traditions integrate. This change of emphasis will require fresh communications strategies, but Bauer is well equipped for this and the international dimension of her work, having worked in a variety of business sectors during the past two decades. "You have to watch the industry you are in," she said. "You have to adapt to cultures across markets and industries."