Cindy Heston
With travel vendor consolidation potentially adding to the already-rising cost of corporate travel, worldwide travel manager Cindy Heston is looking inward at Paris-based digital video technology firm Thomson to identify opportunities for cost savings and service and process improvements. She discussed these and other issues this week with Management.travel.
What are the key challenges today for travel managers?
It's funny because there are no new challenges. It's all a pendulum that goes back and forth. What I'm feeling today has also occurred in the past. It's the further consolidation, with travel agencies, car rental ( Europcar and National), airlines, even technology with Hi-Mark and TRX. This is not to say there aren't new suppliers popping up every day, which is great, but the legacy supplier base seems to be dwindling. That in itself poses challenges because it can be harder to bring contractual value back to the company. A lot of suppliers this year are just saying they are targeting you at X increase, and that's how the discussion starts, which is relatively new. We're used to more of an expectation of an improvement in the bottom line and not going back to the organization to talk about increases. You balance that with other ways you provide value. What we have been focusing on internally is to have more of a controlled view of the behavior, policies and technology and internal education we have in place, [seeking] ways to improve upon what we have today. Not to exclude what's going on with the supplier base, but I think [consolidation] has pushed us even more, internally, to ask, "What can we do to have a value add with current behaviors and practices?"
Do you do regularly review those policies and procedures?
I "dotted line" into sourcing and report directly to human resources. From a sourcing perspective, we benchmark three times a year as far as objectives, the marketplace and what's going on, and key performance indicators. In sourcing, there's definitely the drive for value and where we can bring savings in supplier negotiations. On the HR side, our company is challenging us to be internal consultants, so rather than calling on McKinsey or another consulting firm for input on internal processes, why not look at our internal resources?
The new magazine we started in December, Procurement.travel, has a regular feature on outsourcing since procurement people seem to have more of an orientation to that than, say, travel managers. But there never seems to be a trend one way or the other about whether people are outsourcing or in-sourcing more. It seems like both are always happening at the same time, and it really depends on the personality of the company. What's your experience?
Back in 2002 and 2003, we tried to outsource everything, including my position. We were outsourced for a good year and a half. They externalized everything and it was like a vacuum. This external company made all the decisions. It was a good exercise because it immersed me in the sourcing side of it. I wanted to go over because I wanted to manage contracts. I didn't want to be trying to make contracts work on which I had no input. I think the worst situation a travel manager can get into is to allow the sourcing organization--whether internal or external--to manage that piece of it and then just be handed a contract and asked to execute. I want to be part of the whole process from negotiation, and all the different aspects of that, through to the execution, because to me it all flows together. That was a whole different Thomson and is not the way it is today at all. For whatever reasons, again more the HR piece, we said we want that knowledge base internally and it was all pulled back in. It was something we tried, and in the end, travel and sourcing have to be more in concert.
So, with this more consultative, internal focus, what kinds of projects are you working on?
We have a few things going on. We constantly were challenged by how to get the word to our top users and how to communicate effectively, including road shows, sending e-mails, updating the travel page. So we conducted a survey with administrative assistants, who probably make 80 percent of our transactions, which found that it's difficult for them to make it to in-person presentations. And even Web-based demonstrations of an hour and a half are difficult. So for the past six months, we have been running 20-minute presentations of about ten slides focusing on specific areas of travel. They can range from the booking tool functions, a new alliance airline agreement, etc., and we archive them on our Web page. On the last call, we had 40 people, so it seems to be catching on. We do 20 minutes of formal presentation, and then open it to Q&A. From an agency perspective, the human factor is important. Part of our new agency agreement is what we call a service-level agreement within our agency. For all countries, we have a "full circle" value program where we incentivize the agency to do contract-beyond services. So if a traveler calls in the day before a trip and cancels the hotel, and says, "I know I'm going to have a hotel no-show," the agent is now encouraged to call and try to get that waived. If they're successful, it's added value, provides savings, and the customer is blown away because they're used to going online and dealing with more robotic responses. And the agency is told it's okay to make those phone calls. Today there's so much focus on "no touch," "low touch," "I don't want to touch anything" ... I think it's awful. This is travel services, not travel technology. I really wanted to bring back to the customer why we use the agency and "here's what they do for you," and on the sourcing side, we're bringing back the money, or value, to Thomson.
After all the global distribution system content conflict last year, do you have a different perspective on distribution technology, and what are you doing differently?
My perspective has always been to have direct relationships with the technology providers, including the online booking tools and GDSs. Now, I'm more involved in meetings and updates and beta testing new technology. Although the [GDS] relationship was already there, it further opened the dialogue and cemented the relationship we have with them. I want to be involved with how they're dealing with these issues and what their plans are for the next round. Where before they were one of the suppliers we met once or twice a year, it's much more interactive now. Sabre was just in here last week and I was charged by some of the things they're working on. They have a new security suite for corporate customers and a new commissions tracking tool, and we signed up for both. So we're now more invested in that partnership.