Thurs, July 16 at 1:00 PM ET / 10 AM PTSponsored by: TripActions
Thurs, July 23 at 11am ET / 8am PTSponsored By: American Express Global Business Travel
Tues, June 30 at 11am ET / 8am PTSponsored in part by: Cvent and The Inception Company
Virtual Event - July 29, 2020
Virtual Event - September 9-10, 2020
Hyatt Regency Boston - October 12-14, 2020
Filter in or out as many as 200 cities, as well as hotel and car rental class and meals of the day and watch as the per-diem calculator automatically adjusts per diems to your program. Drill down into cost breakdowns and export the results.
Three years ago, during one of Wal-Mart's monthly "P&L Friday" meetings, the consolidated profit and loss statement showed that travel spending was rising faster than sales or profits. Soon mandated to become what director of global travel services Duane Futch called "a worldwide program manager for corporate travel leadership," his department began asserting an extraordinary amount of control.
A quick review of conditions had shown that travel purchasing and data were fragmented, technology was deficient and the company needed to better control travel globally. Using its Corporate Travel Department designation to consolidate travel in Puerto Rico, Canada, Mexico, the United Kingdom and the United States, Wal-Mart implemented a strategic plan for global consolidation that originated in 1999, when ARC accredited the company.
Yet, even as Futch told participants at the sixth-annual Corporate Travel Department conference here last week about the merits of control and consolidation, he confirmed an exception. In Brazil, Wal-Mart broke its mold of supplanting local agencies with the centralized configuration after determining that a partner, Flytour, "can beat our metric on producing an airline ticket," Futch said.
"When we looked at the return on investment of this project, we realized we could achieve the same goals having our own people as we could with Flytour's," he added. The Brazilian agency has done a "superb job over the last 11 years working with our office down there ... We're very, very comfortable with them. We like their professionalism, we like their technology, we like their customer service."
"We're taking this one country at a time," said global operations manager Mary Sharp. "We've been successful with the countries we're in and looking ahead, but it takes a lot of homework. We have to look at the financial impact to the company and the benefit. That's really what our decisions are based on." Officials may spend six to 12 months analyzing a market, Futch added.
Wal-Mart considers the return on investment, customer service, technology and solutions to ensure "that data is not fragmented and that you have access to data and ownership of data. Those are the key pieces of the puzzle. As long as you have that, I think you can make some very intelligent decisions," Futch said.
In evaluating its options, Futch's team prepares a financial model that includes current and projected costs, and the savings delta. The CFO of the country in question and Futch sign off on the document and begin to benchmark progress. "To date, I can't tell you what the number is, but I can tell you in every country, we have exceeded our goal of cost savings, to the total sheer delight of each [country's] CFO," Futch said.
With more than $312 billion in sales, 1.8 million employees, stores in 14 countries and more than 60,000 suppliers sourced by 31 global procurement offices, Wal-Mart manages travel a little differently than most companies.
"What we have really done is maximized the value of all the ARC tools and services in production. We've also been serving as a prototype user for new products and services that are being developed by ARC," said Futch.
Using its CTD designation, "transaction data is held centrally in Arkansas [at corporate headquarters] on Wal-Mart servers [and] all reporting is generated from one location," Futch explained. From all country offices, data is transferred to the United States, ticketed in U.S. dollars and then transferred back to the countries for payment in local currencies using UATP.
While peers may opt to ticket in local currencies to take advantage of exchange rates, Wal-Mart said this strategy works to reduce overall tickets. The cost to employ agents in some countries would more than outweigh any exchange rate savings.
The ARC settlement plan is the only one Wal-Mart uses, aligning with its single-provider strategy for the GetThere self-booking tool, Sabre global distribution system and UATP payment system. The company wants just one contract with preferred airlines and other suppliers. Previously, Futch said, the company had 17 different contracts with American Airlines and eight or so with Delta.
Wal-Mart has outlined local tactics and global strategies for offices around the world to ensure that local offices do not, for example, sign airline contracts, but have the autonomy to manage cultural nuances, staffing and P&L budget responsibility as part of an overall approach to program globalization, Futch said.
Commonality of systems, tax laws, data privacy and the cost of doing business in each country are all among the factors. In the United Kingdom, the travel team needed to provide employees with a better means to book rail and hotels that were not available in the GDS, said Sharp. GetThere integrated the third-party sites into the application and Wal-Mart installed a rail-ticketing machine in its offices to help resolve those issues.
In October, Sharp brought 13 travel managers from around the globe to the Bentonville, Ark. headquarters for Wal-Mart's first best practices summit with Futch, domestic travel operations manager Teresa Asbery and representatives of procurement, global security, travel security, sustainability and other areas. Each country presented an overview of its travel department, spend, preferred suppliers and patterns.
"It was also a tremendous opportunity for all these individuals to network with each other, because you're talking about people coming from China and Japan who had no idea who their counterparts are in the U.K., Brazil and Argentina," Futch said.
Besides showing that all participants are part of a bigger travel management picture, the conclave allowed each manager to "see that they were part of a smaller group, and when they have issues and concerns, they have resources," Sharp added.
Wal-Mart's overall approach appears to be working thus far. For fiscal year ending 31 Jan 2006, Futch said his team projected total travel expenditures, one year in advance, within $15,000 of the actual figure. "That tells us our tools are reporting very well," he said.
"We're in this for the marathon, not the sprint," Futch added. "We're going to do this methodically, correctly, because there has to be a return on investment at the end of the day. What you did last year probably isn't going to be good enough to do business in two years. We have to make sure that we're reinventing ourselves to meet the requirements of the future and of the countries."
Futch and his team during 2007 will examine opportunities in Central America, Japan and China. In Brazil, Wal-Mart will deploy GetThere in the first quarter, Sharp said.
WestJet will increase its August schedule by 10 percent compared with July, though its schedule will...
Delta Air Lines and Latam Airlines Group this week filed with the U.S. Department of Transportation an...
SAP Concur is making its TripIt Pro travel management app available to all users of its TripLink...