Negative financial expectations and positive results yielded by applying procurement practices to travel management are accelerating interest in what companies decide to measure, the models of measurement they devise and the tools they use to do so.
Business Travel News' 2008 Procurement Practices study examines how and how much such practices are being applied to travel. It provides an understanding of the expectations travel and procurement practitioners have about travel and travel spending in the near term as well as their outlook on the relative importance of controlling costs versus ensuring a suitable level of service.
While building on the baseline of original research that we conducted last year, this year's study is an attempt to drill down even further to understand the use of specific contractual agreements that establish service levels and measurements of current and prospective travel supplier performance and traveler behavior.
Download a PDF of the full study here, including all data, charts, stories and a roundtable discussion of four practitioners fluent in marrying procurement with travel.
Making The Most Of Business Travel Metrics: The true measure of a successful travel management program is its ability to properly support each business mission at the lowest appropriate cost. The mission of a strategic sourcing initiative is to establish quantitative assessments to both derive greater value and drive lower costs for a commodity. Combined, they can institute meaningful travel process improvements.
Perspective On Travel As A Commodity No Longer Bleak: Commodity used to be a dirty word to travel managers, invoking their worst suspicions of what procurement would do to the services they manage.
Buyers Seeking More Precise, Stringent SLAs, KPI Metrics: While an increasing amount of procurement-oriented travel buyers are using service-level agreements in some of their supplier contracts, some buyers, as corporations increase scrutiny of T&E spending in the current economic environment, are reevaluating their SLAs to make them more stringent and including risk-reward criteria in the form of financial incentives for exceeding goals and penalties for shortfalls.
Companies Adopt Mandates, Scorecards, Demand Management: Use of numerous procurement practices, including supplier mandates, demand management and scorecards of metrics, is reaching critical mass among travel programs, and such practices also are becoming more widely used on the meetings side, which has been slower to adopt them.
Procurement Practitioners Who Make Metrics Count: Deloitte chief procurement officer
Mike McMahon, United Technologies Corp. travel commodity manager
Marcia Tellez, KPMG's director of operations for firmwide procurement
Patricia Barrett and Pfizer vice president of worldwide procurement
Tom Donatelli shared metrics and experiences at a
Business Travel News editorial roundtable.