Profiles In Travel Management: Spinoff Reinvents Booz Allen Hamilton's Travel Program
The Booz Allen Hamilton global travel management team entered a new era after last year's spinoff of the Booz & Co. commercial management consulting arm. Now almost entirely a government contractor, Booz Allen has revamped its travel program, adding suppliers, lowering costs and deploying a new online booking and expense management tool.
Now with 1,000 fewer cardholders, more than 20,000 employees, 12,000 cardholders, and the lion's share of the company's $100 million-plus U.S. T&E budget remain under the management of the Booz Allen travel team. "We had to be cognizant of the fact that our patterns may have changed," said global travel manager Jack Lever. "The commercial pattern is a little bit different than the government pattern."
With those travel pattern shifts as it became primarily a cost-reimbursable government contractor, Booz Allen added low-cost carrier AirTran Airways and United Airlines to its preferred carrier list. Despite its Dulles International Airport hub neighboring Booz Allen's McLean, Va., headquarters, United had been absent from the air program for many years, according to global travel manager Hillary Dallas.
Dallas and Lever are part of a global travel management team of five who operate within the sourcing department. Association of Corporate Travel Executives president and former Booz Allen global sourcing manager Douglas Weeks has become Booz & Co.'s director of global sourcing and travel.
Booz Allen restructured its hotel program to bring it within government per diem rates. Lever and Dallas found more negotiating receptivity this year as hotel demand has plummeted. Hotels in some major markets that originally offered rates above government per diems have returned at or below the rate, Lever said. "It's very reactionary on the part of hotels and it's what we saw in 2001 and 2002 and up to 2005, when hotel chains did the same things," he said.
To offset cyclical hotel demand, Lever said he plans to lock in multiyear agreements. "If you can get the rates down, you probably want to get multi-year deals," he added. "It's going to come back, and just like they did in 2005, they are going to try and make up for the one or two years in losses with a vengeance."
Meanwhile, the company began using the Concur Travel & Expense platform, and Dallas and Lever led a series of events at the company's 40-plus U.S. offices to help build traveler awareness of the new system. "It's been more grass-roots than anything else," said Dallas. Booz Allen now has 40 percent online booking adoption in a non-mandated environment, compared with pre-implementation peak of 15 percent. Online transaction fees are 35 percent less than offline.
Once senior management saw the efficiencies of a consolidated tool, including e-receipts, receipt imaging and linking travel itineraries with expense management, Lever said it became the "launching pad for getting the buy-in" throughout the company. "The general rule is that if you can make an administrative task in a consulting environment happen faster, that's good," he said. "We want to be in front of our clients, not conducting administrative tasks."
The travel team plans to carry its success with garnering more data and reporting capabilities through the Concur deployment into plans to implement hotel e-folio reporting later this year, Dallas said.
Corporate Travel 100 firm Booz Allen is tweaking its policy to promote nonrefundable tickets and lowest-logical-fare bookings and reduce unused ticket liability through new reporting tools and technology.
Travel expenditures are on pace to increase 15 percent this year compared with 2008 levels to about $100 million as the company strongly increases its business travel to Asia/Pacific and the Middle East. According to Dallas, U.S.-outbound travel now makes up 30 percent of Booz Allen's travel expenditures.