5Q with HRG Consulting's Ian Flint

Hogg Robinson Group in July named Lee DeVet vice president of HRG Consulting in North America, reporting to head of global consulting Ian Flint. DeVet now is building teams in Canada and the United States, he explained during a conversation at last week's National Business Travel Association conference here with Flint and The Transnational. Flint provided information on HRG Consulting's development and fielded questions on such topics as global hotel programs and environmental concerns.

Can you offer an update on HRG Consulting?

HRG Consulting is an independent business within the HRG Group, which was launched on the [London] stock exchange last year as a services company. Within that company there are five separate businesses. One happens to be a travel management company, but the consulting is independent, to really protect our integrity with our clients. We are growing. We are very European-based, and we are now looking closely at North America, and Lee has joined us. He is looking to develop onboard project managers and analysts to have a completely independent business in North America, but of course there is a crossover and an exchange between all the consultancy elements of HRG. So we develop models, and Lee will look at how to develop them further for the U.S. market, and how to Americanize them a bit. We are fully aware that the language, and way of doing things, is not always the same on the U.S. side. The U.S. is a very big, domestic market. It's a slightly different focus than Europe, which is internationally focused. That's the way business is.

For which tools and services is HRG Consulting, on a global level, seeing a higher demand?

We are seeing quite a diversification. We are quite proud of the tool we have developed for airline analysis, which has data feeds for all the airlines around the world, so we know their exact capacity, frequency, etc., and can factor that into any analytical requirement. There is no point in having a fantastic discount if [the airlines] can't take the business you've got. And a lot of people are now looking at the environment. We have a carbon calculator, which actually does comparisons between an air journey and a rail journey--more relevant perhaps in Europe, but even if you look at the East Coast and the West Coast of the United States, you have a good rail network as well. The comparison will also tell what happens if you hire a car--and the type of car you have, whether hybrid, etc. Interestingly, if one person is traveling from A to B by air, the carbon dioxide emissions for rail are far less. If one person is traveling by car, the emissions are higher than for rail. But put four people into the car and it comes in lower than traveling by rail.

Is the carbon calculator at the point of sale, so people can proactively make such comparisons as they are booking a trip?

We want to have that. At the moment, it is online and can be a standalone item. We would like to be able to build it into the booking tools, so they can see that. We're getting there, but we are not there yet. In terms of environmental issues and social responsibility ... Europe is very strong on it right now and the U.S. is catching up pretty quickly. There are companies who are big enough who say, "I should be seen doing it." But then you ask if they have an environmental policy, and how they make people aware of that policy right through the ranks. Some companies are better than others. It really is the company that has to decide at the very top if it wants to do it, and then ingrain that into its travelers. So there are those differences, and differences in how they use the tools to their benefit. It is great to have data, but how do you interpret it?

In terms of hotel programs, many companies are feeling cost pressures as rates continue to rise in markets around the world. How can you help clients alleviate those pressures?

We do a lot of hotel programs. We have to be careful because, like airlines, for hotels it comes down to yield management. If they are having a really good time, then it is more difficult to negotiate. We have some companies that have been able to achieve a degree of savings, but more importantly, they have been able to maintain their rates. The key is to analyze the baseline: what rates you are paying, how many hotels you are using in a city ... and can you deliver? You'd be surprised how many use hotels they really do not need. A supplier will take your word for a while, but they'll pull [a preferred deal] if you are not going to deliver. So the way we approach it is [to] find out where you stand and understand your culture, and see if we can take it to what we know would be a high adoption level and acceptance around the world.

How do you help with hotel program adoption, which generally is lower than adoption of managed programs related to travel management companies, airlines and corporate cards?

What we would like to do for clients is offer an all-encompassing service. We also look at policy. You say that adoption rates aren't very good; it's usually down to a weak policy. If it is a mandated policy--I know that is a swear word in some businesses--you are going to have a better chance of reaching those adoption levels and those savings levels. We try to get buy-in. We don't just say, "We have looked at your hotel program, we have gone out to bid, we have received back these bids, these are the cheapest and you should have them." We say, "Here are the hotels you use, here is the range of new offers, here is the average city rate and here is the rate you have been paying. Now let's go out to those markets and ask why we should be using those hotels." At the market level, they know better than we do, because we don't know every hotel in the world. It is amazing how often you'll hear, "Don't use that hotel right now, because there is scaffolding in the front," or all sorts of other things, but, "There is a brand new one that just opened two blocks down." Immediately, a request for proposal goes out [for that property] and we factor it in. So, they have been part of choosing that program and you start getting a higher compliance level. Also, when companies are embarking on a global hotel program, you do an analysis of how many markets have an agreement with the same hotel at different rates--for the Waldorf-Astoria in New York, Australia will have a different rate from France, from the United Kingdom, from wherever--because they didn't know. They didn't have that communication and that consolidation. You get a better deal by consolidating it because hotels now know that you manage it. And that's what they want to see.