Pitney Bowes Team Revamps Travel
<B> Pitney Bowes Team Revamps Travel</B>
By Sarah Welt
<I>Stamford, Conn.</I> - Pitney Bowes Inc. has revamped its entire travel program this year drawing on the expertise of its recently assembled travel council.
In doing so, Pitney Bowes re-selected its primary travel agency, as well as negotiated discounts with airline, hotel and car rental vendors--going out to bid simultaneously.
Pitney's new cross-functional team consists of members from several different divisions--corporate purchasing, finance, human resources and strategic sourcing--who have united to focus on communication, expense reimbursement, policy and technology. The team also included Pitney's manager of business diversity and outside consultant Carol Ann Salcito, president of the Stamford, Conn.-based Management Alternatives.
"The cross-functional team was unusual in terms of travel," said Connie Cirillo Freeman, manager of travel services. "It was the first time people from different business units/disciplines were involved in travel selection."
The company's travel council meets quarterly and has met twice since its February startup. The team, similar to the strategic sourcing group, contains members of all the different business units. It is focusing on streamlining the travel process and taking expense out of the equation. Its four tracks are communication, expense reimbursement, policy and technology.
In facing its program, which has $17 million in air spending, Pitney Bowes' team decided the first step was to choose a lead travel agency. It re-selected the Stamford, Conn.-based Robustelli World Travel in April. While Pitney had a relationship with Robustelli, the company sent out requests for proposals to over 25 agencies. The effort resulted in negotiations with four major agencies, including some megas.
While Robustelli has the majority of Pitney's business, the company also works with several minority or women-owned and operated travel agencies as part of its corporate objective.
Pitney Bowes in the United Kingdom recently selected Britannic Travel of London, and in Canada, it chose American Express, though those two agencies have not yet been implemented. Once they are, the two agencies will work with Robustelli to consolidate data worldwide.
Pitney Bowes last month signed Hertz as its exclusive car rental vendor. Similar to its agency and airline contracts, cost reduction targets are built into the car agreement, Freeman said.
"Going forward we are looking at programs we can put in place that could possibly result in cost savings,'' she said, adding that Pitney also will look at traveler behavior, and consider alternate places for car return and pick up.
On the hotel front, Pitney Bowes has negotiated all local properties and has received preferred rates with Connecticut properties based on volume. Cost reduction isn't easy with hotels acknowledged Freeman. "It's a seller's market, so we are looking at cost containment with hotels right now." Because the ink is not yet dry on airline contracts, Freeman would not disclose preferred suppliers. However, she did say that the goal is to work with as few preferred carriers as possible. Freeman said the company has not changed its negotiation strategy for air, but it has increased the involvement of different business units.
"I feel we have more buy-in because everyone in the business units has been involved in the decision," Freeman said. Some net fare deals will be involved and some aspects of the company's contract are global. The RFPs for air went out to all travel suppliers at the same time and, "As soon as we completed the agency selection, we went to airlines," Freeman said.
The company chose Robustelli again because, "They were the most competitive in terms of pricing," Freeman said, adding that, "In terms of service we had an excellent track record."
The new contract has a management fee arrangement, though Freeman said the company already had been migrating to this approach. "Before the cap we had commission sharing, and a year or so before the cap we started migrating to fees."
The contract also contains performance incentives for Robustelli. The regional agency is to target the lowest airfare, and there are performance level incentives, deadlines for reporting and customer satisfaction benchmarks.
The travel council just started looking at expense reimbursement and a subcommittee of the council is looking at options to improve the process, including ways to improve without using technology.