NBTA Group Gathers Benchmarks

<B> NBTA Group Gathers Benchmarks</B>

By Sarah Welt


The NBTA Travel Management Exchange Forum Program, created to provide an outlet for more experienced travel managers to share best practices, this month will unveil a database of benchmarking standards compiled by the group.

The data will be available to TMEF participants on a new section of the National Business Travel Association's Web site, called Travel Vault, that will debut at the annual NBTA conference being held July 18 to 21 in Minneapolis.

Launched four years ago, the TMEF program appears to be on a roll, this year adding a fourth benchmarking group, a professional coordinator and an expanded global scope that brought its forums to Hong Kong and Brussels.

The global program originally was organized to allow U.S.-based travel managers to meet and work with their overseas counterparts, but now all three groups have mostly European travel managers as members.

While swapping information and sharing personal experiences is an integral part of each two-day meeting, the benchmarking is clearly the real draw. Management Alternatives vice president Will Tate, who got involved in the program as travel manager for Dresser Industries, has been hired by NBTA to work with Colgate-Palmolive Co. director of corporate travel services Cynthia Perper as a TMEF facilitator, to help the group develop a spreadsheet of benchmarking data standards.

Coming up with standards is a laborious process, though, acknowledged NBTA president and TMEF participant Mark Johnson, who is the travel manager of Cessna Corp. "It is much better than it was in the first meeting, but it still has a way to go," he said.

Perper noted that "each of the different categories we are benchmarking have to be clearly defined, and you really have to be finite about what you are measuring. For example, if you were measuring agency fees, what does that mean? Is that a transaction fee or a management fee? What other fees are you paying? Does that include labor? Are you including only the travel agency or do you include office equipment or Fedex in your ticket costs? By clearly defining what a data element consists of, you get clearer data output."

Gerald Verhasselt, manager of corporate travel services at San Francisco-based Bechtel Corp., noted that as the group has worked through its data definitions, "there have been some really wide differences. When you start having people explain what is in their data, you find out people haven't understood the definition clearly."

But there has been a lot of progress. Johnson said that at the last meeting, Tate introduced the idea of developing a tool to help travel managers calculate how their travel operation affects the bottom-line value of company stock.

"That's a very powerful piece of information to take to a CEO," Johnson said. "If a travel manager can say, 'Hey, if by me doing this I can affect our stock by X amount,' people are really going to raise their ears."

Johnson said Cessna already has benefited from his participation in the benchmarking group, particularly from the formulas developed there to show "what each ticket is worth on a savings basis and what each ticket is worth on a revenue basis." He had never quantified travel data in that form to senior management before, but the numbers now are part of his management reports to his boss and to the senior vice president of human resources. "Now they see what each ticket is worth to the company," he said.

At Sunnyvale, Calif.-based National Semiconductor Corp., manager of travel services Mark Vilcsek has taken home advice on including penalties and incentives in agency contracts. "We got insight from our peers on different ways to calculate and quantify service levels that I hadn't done previously," he said.

In fact, his growing interest in benchmarking has spurred him and fellow TMEF member Susan Dupart, manager of corporate/site services for Milpitas, Calif.-based Quantum Corp., also to join about a dozen high-tech companies from the Silicon Valley in monthly benchmarking sessions with a more regional flair.

Verhasselt, meanwhile, said he too has put many ideas gleaned from other members to use, and in turn, has shared his airline and CRS RFPs. "I take all the proprietary information out and share them with other people," he said. While he noted that the interactions have been "very helpful," he did suggest that breaking out benchmarking groups by industry, size or geography might provide more useful dialogue.

The TMEF program began, insiders said, in response to waning participation in NBTA by its more savvy travel managers, who complained they were not deriving enough value from the meetings. As a member of the NBTA board, Perper was charged with coming up with a solution. She and the NBTA staff determined that a "think tank" environment would allow travel managers to take a more proactive approach to their day-to-day jobs in what she described as an often "reactive industry."

The group's members obviously agree that sharing real-life data and experiences with their peers is something that cannot be duplicated in an hour presentation.

"NBTA got so big and meetings got so general that they didn't do anything for me. I left and went to ACTE, but this brought me back," said Calvin Smoot, director of purchasing and travel services for The Church of Jesus Christ of Latter Day Saints in Salt Lake City. "Through the processes developed by NBTA and the group, we have developed benchmarks that are in my opinion realistic and truly give us the feeling for where we are strong and weak as an organization. I can look at my numbers confidently and see where I have best practices. It's the best thing I've ever done."

Quantum Corp.'s Dupart agreed that while NBTA and ACTE are important associations, their meetings do not offer "enough opportunity to meet just with our peers and talk about what is going on within our companies. It is very difficult to sit down and talk about things with a vendor sitting there."

The TMEF Program now has grown to four groups, each with about 20 to 25 participants. Members must commit to attend both meetings each year and be willing to share their travel management data prior to meetings for benchmarking purposes.

There is no charge for joining a TMEF group, though potential members first must join NBTA.

TMEF programs will be held in the United States this fall, and Global TMEF programs are scheduled at the NBTA/ITM conference in London in March 2000, and in Hong Kong in April 2000.