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Before leaving his Latin American post in late summer for a new job as Shell International's corporate travel manager in Europe, Allan Traicoff spent two years learning about Latin culture and turning Shell's limited programs there into a highly consolidated structure that features two regional call centers.
After centralizing travel management only in its three headquarters cities of London, Houston and The Hague, Shell in 2004 sent Traicoff to Latin America to professionalize management for largely internal reasons. Now, the company is prepared in Latin America to begin such newer-fangled initiatives as corporate online booking.
"Why did Shell expand to Latin America, which is typically 4 percent of our spend?" Traicoff asked at the Association of Corporate Travel Executives conference here in October. "Internally, our structures permitted it and we had senior management backing to make it happen."
Shell may have a global travel budget that exceeds $600 million--80 percent managed centrally--but its footprint in Latin America is relatively small compared with some petroleum companies. Still, the fact that many of its Latin businesses are wholly owned, rather than structured as joint ventures, helped create a strong local proclivity for cost savings.
"Literally overnight, we were able to come in and add it to the global map," joining the three headquarters, said Traicoff.
He started by reaching out. Through traveler surveys, Traicoff quickly learned that travel in Latin America was frustrating and time consuming, partly because there are no dominant carriers. "Getting from point A to B is nothing like getting around Europe or Southeast Asia," he said. "There is a lot of connection time, and sometimes you have to combine carriers."
Becoming more familiar with his company's operations and hierarchy, Traicoff built a network of local, senior personnel who showed interest in the program. He then "regularly" involved them in his initiatives.
He worked with Shell's global travel management company, Carlson Wagonlit Travel, to consolidate most data, and data consolidation partner Prism Group to track the rest. Both were "instrumental in helping us understand how big our spend was," Traicoff said, estimating that 90 percent of Latin America was consolidated with CWT, versus about 80 percent worldwide.
Along the way, Traicoff served as a liaison to headquarters and interpreted the impact of cultural and infrastructure differences for home-office managers. "Globally, people needed to know Latin America is a different type of region," said Traicoff. " 'Manana' is the culture, and they needed to be flexible. The region has some legacy behaviors around high service and high touch, so [there's some] change management. [We could not] take a 'cookie-cutter' approach." Although there were cultural differences, well-developed management was not nonexistent.
Shell's biggest Latin American market, with about $10 million in annual air volume, is Brazil, where an "innovative" meeting management team already had online request forms and was "quite advanced," Traicoff said. He also called Mexico a "shining area" in that it offered "high" Internet penetration and "tools to assist with travel management." However, "the rest of [the region] was complete virgin territory."
In other nations, data and agency consolidation helped Traicoff turn local agreements into regional ones and apply a global hotel request for proposals. With airlines, Shell has even pushed for negotiated fares that are net of commissions. "Most airlines have gone along with the European and U.S. models which are net net," he said. "There are still some markets where legally you have to pay something, but we're even finding ways around that. In difficult markets like Colombia or Costa Rica, we work in a three-way partnership with the airline and TMC to pass on the benefits to our travelers straight away."
Two years after he started, Traicoff had helped build two call centers serving 18 countries across the region--one for Portuguese and another for Spanish--and could claim that 95 percent of the business in Latin America was "managed globally."
"This gives us the launching pad to move on to new things, and an online booking tool is our next project," said Traicoff, who, in his new role, has an eye on consolidating Africa, the Middle East and Russia.
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