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.
ExCeL London - 24-25 February 2021
When Albert Taras established TCG Consulting more than 20
years ago in Miami, he had no way to predict the unprecedented changes that
would occur across all facets of the corporate travel industry during the
"Back in 1994, the primary marketplace dynamics that
impacted corporate programs included managing supplier commission reductions
and new direct corporate agreements. Additional drivers include program
evolution to global platforms and technology advances enabling new fare-search
sources via the Internet," commented Taras.
As companies expanded and created multinational and then
global operations starting in the late 1990s, the urgency to create and
implement a strategic plan for global corporate travel was becoming apparent to
Initially, many advanced strategic concepts that originated
in the United States failed to gain traction at the local market level
globally. Today, a more regional and global approach is required.
Another trend, driven by technologies which have emerged
since 2010, is the shifting role of travel agencies in the value chain. Taras
commented on this change: "The traditional business model—companies engage
an agency partner, inclusive of the agency's preferred support configuration of
technologies and suppliers—now has the potential to be evaluated independently.
Companies can choose to implement a 'build our own' strategy via direct
sourcing of new tools based on unique and evolving reporting, financial, risk
management and geographic segments. This unbundled company strategy across
critical program components—global distribution systems and content, online
booking tool management, security and risk management, account management
functions, profile, mobility, sourcing and more—is redefining the role of the
agency within corporate travel as a program and operational enabler."
The single-agency global support model strategy also is
experiencing a shift. "In the late '90s and early 2000s, leading companies
expanding globally saw 80 percent of their spend coming from 10 to 12 markets,"
Taras said. "In 2010, 80 percent of travel came from 25 to 30 markets. As
of 2014, many program spend patterns have spread to the point that 80 percent
of the total spend is spread among 60, 70, even 100 global markets. As
companies continue to see spend concentration becoming diffused, many find a
customized multi-agency support model is the optimal configuration. We are
seeing upwards of 40 percent of our clients who operate a global platform using
a multi-agency model."
The multi-agency support model does create challenges:
• Command and
control: Localized support and customization benefits of a multi-agency
model are tangible, but recent trends also show a potential "command and
control" risk in certain circumstances, bringing higher costs due to
supplier and multi-agency integration, complexity, overlap and coordination
issues. Taras urged companies to "conduct effective due diligence and not
be dissuaded from evaluating a multi-agency approach due to the significant
benefits that may be available."
• Account Management: When delivered as a bundled solution, account management
costs average between 11 to 24 percent of total agency fees, with 17 percent as
an approximate average mean and benchmark. "Companies now desire a true
and transparent program management cost/value analysis that can be measured and
critically evaluated, especially where there may be redundancy in account
management support functions," said Taras.
As the Internet and mobile technologies are now
fundamentally altering how we interact and conduct business, what are some
leading indicators of what the next 20 years might hold?
mobility strategy: Millennials have never known life without the Internet,
demanding the "always on" immediacy of new technologies, especially
mobile. This trend must be addressed by corporate travel programs. An optimal
user experience in corporate travel serves as an effective retention and
recruitment tool and point of differentiation. In addition, as this generation
advances into leadership roles, the willingness to adopt advanced technologies
and strategies becomes much more pronounced.
of travel, meetings, payments and expense: Innovative tools are enabling
companies to create a truly integrated strategy. Back-end data drives front-end
strategy and decision support, including purpose-of-trip and demand-management
further reduction of corporate direct discounting: Industry consolidation,
alliances and supplier discipline will all continue to perpetuate a supplier
seller's market that started in 2008 and shows no sign of abating. Taras posed
a question: "Could a next step include reduction or even elimination of
corporate direct discounting? If this occurs, how would companies and other members
of the corporate travel ecosystem need to alter their strategy, policies and
Integrating transient and hotel spend and establishing integrated reporting and
payment, common sourcing, contracting and risk policies—all are possible for a
company committed to an optimized meetings strategy.
Harnessing big data:
Effectively harnessing, filtering and applying big data as part of a company
strategy will produce tangible results. These can be realized across cost
control, policy, user experience, influencing behavior during trips, enhanced
risk management and reporting, among other aspects.
When asked what the last 20 years of history could teach us
about the future of the corporate travel industry, Taras replied, "While
technology can serve as an outstanding enabler, corporate travel programs will
only be as effective as the strategy they have created and how they align with
the strategic imperatives of the organizations that they serve. This will
include integrating systems, effective policy, detailed reporting, supplier
programs and securing senior leadership support."
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