Profile In Travel Management: Co. Consolidates TMCs - 2007-05-07

Two years after setting out to maximize savings and better negotiate vendor contracts by consolidating the Hercules Inc. travel program, global travel manager Karen Bevis has brought the number of U.S. agencies serving the Wilmington, Del., chemical manufacturing company down from 35 to one. Because of this, she also was able to implement one online booking tool that further has helped streamline her travel program.

Prior to contracting American Express as the consolidated travel management company in 2005, Bevis did not know how much money her company was spending on travel in the United States. Using credit card data, she found Hercules was using a minimum of 35 agencies throughout its 13 locations to book travel.

"In Europe, it was impossible to tell, because we didn't have a local credit card program," she recalled. "You didn't know how to get to the travel agencies to find out exactly how much money they were spending."

U.S. agency consolidation was the first step, followed by Europe, Canada and the Asia/Pacific region in 2006. "We're not located in big cities," she said of choosing one agency. "Most of our operations are located in rural areas and we felt American Express could handle our business around the world and be able to touch all of the locations we were running."

After that process was complete, Bevis set out to find an online booking tool she could implement, first in the United States and then eventually across Hercules' worldwide locations. By demonstrating the savings it would yield, purchasing an online booking tool was an easy sell to senior management, she said. Two years ago, she chose Amadeus' E-Travel Management tool, which allows employees to plan, book and purchase itineraries using preferred suppliers within company policy.

"One of the major things was to sign on with a global distribution system around the world and we were able to have American Express support us in getting up on Amadeus in the U.S. and in Europe," Bevis said. "Following that, we brought on the booking tool and one of the reasons we selected E-Travel is that we felt that it went hand in hand with Amadeus' global distribution system."

Simultaneously, Bevis implemented GE MasterCard as Hercules' single global credit card.

"The benefit to Hercules is that they can see exactly where they're spending their money and how much," she said. "Most of all, people now understand it's easier to pull all your data from one source rather than having to go all around the world to get that data."

After implementation, Hercules' online adoption initially was less than 10 percent. Currently, the tool is used for more than 50 percent of company bookings.

Last year, she told American Express agents to insist Hercules employees use the tool when booking roundtrip travel. However, Bevis explained, because the company has to take into account that there are some company locations, even in the United States, where the Internet is not available—"It's probably about 10 percent of our locations," she estimated—a true mandate would be impossible.

Now, "the savings are becoming bigger and bigger all the time," she said. "We can track advance purchase days, we can track online prices versus telephonic prices, we can track where car rental programs are being used and abused and we can analyze our costs for hotels—and everybody in the travel industry knows how difficult it is to get their finger on hotel rates."

Last June, Hercules moved travel from under finance to procurement. Bevis is the sole member of the travel department, though she now considers everyone in the procurement program her partner, even adopting some of the department's statistical methods to measure the success of her travel program.

"We look at the benchmarks that American Express puts out for the size and type of company we are and we meet and beat all three of those every time," she said. "On our TMC transaction fees, we've been able to meet and beat everybody that's out there."

In 2007, she is working on bringing E-Travel to Latin America and Asia. "That typically takes me about six months because you have to build the data and do the set-up," she said, adding that she expects to complete the process by June.

Bevis said vendor contracts are up in May and she expects all suppliers to remain the same, mostly because the company is still in consolidation mode and she is happy with the supplier selections she made.

"The best we can be is to have E-Travel and the credit card program up around the world and with that will come the lowering of average ticket prices," she said, noting that Hercules looks at its travel policy quarterly to ensure it's meeting benchmarks. "In the travel business, you can't ever sit back and say, 'Well, I'm done.' "