IBTM Hires Hands To Help Build ROI Tool

The Institute of Business Travel Management last month announced a project to create a Web-based benchmarking tool that will measure the return on investment of corporate managed travel programs.

"The constant need for travel managers to show the return on investment and to show the value that they bring to the corporation is increasing, and we continue to hear that from the membership," said Daphne Bryant, foundation director at IBTM, which is the National Business Travel Association's research and education foundation. "They need some benchmarking, they need some best-in-class, they need the ability to prove the value of a managed travel program and to benchmark against that. We heard it from the industry advisory council, the board was tuned into that, and so we thought it was something that needed to be done sooner rather than later. The board decided to make that one of our initiatives over the next 12 to 18 months." Bryant issued a request for proposals to industry-specific and general consultants before partnering with both Partnership Travel Consulting Inc. and Simat, Helliesen & Eichner Inc. on the project.

Andrew Menkes, Chairman and CEO of Partnership Travel Consulting, said PTC will seek industry collaboration and consensus to create the scoring index central to the new tool. "What this project will do is independently quantify the attributes of a well-managed travel program, including finance, administration, sourcing, technology, quality and compliance. All of those together will produce what we call the 'Managed Travel Index' and companies will be able to benchmark their MTI score against like companies," he said. "Instead of taking a general number like average ticket price or average hotel rate, you're stratifying it by geography and by classification. This will present more meaningful benchmarks that are tied to other components."

Menkes likens the MTI, which he describes as both "granular and relational," to the SAT exam. "We all agree that the perfect score is 800 in math and 800 in communications skills. Very few people get 1600, but at least we agree on what is perfect. Obviously, ours, instead of being in two pieces, is more like six or seven components that are weighted. Based on the answers that you give to a question, it will assign a score to them, but you're not going to see the individual answer value, you're just going to get a rollup number. You'll then know what your MTI score is based on how honestly you've answered the questions. That goes into a database housed by IBTM so, as thousands of other companies fill in their forms, you'll then be able to compare your score against other companies that are geographically similar or based on spend or by industry," Menkes said.

Bryant anticipates IBTM will be able to roll out a benchmarking tool at the August NBTA conference in San Diego. "I'm not sure how the final product will look, because we're still looking at some of those components, and it depends on what the travel managers tell us is going to be most useful to them. We're looking at a couple of different options, but it will probably be something that will be hosted on an IBTM server that will be accessible through the Web," she said.

Menkes said that an August debut is achievable, but much will depend on industry collaboration. "Up until now, proving the value of a managed travel program has been difficult and at a minimum, it's subjective," he said. "This is going to be a collaborative process that will involve suppliers and buyers participating in the development of the tool. We don't want it to be our view of what a well-managed program is, it should be the industry's view."