<B>State Farm Seeks Control</B>
By David Jonas
<I>Bloomington, Ill. - </I>After more than a year of sowing the seeds of travel management efficiency, State Farm Insurance is harvesting the rewards of a revamped reservations process and improved vendor contracts. Now, the company is looking for more direct control over its program with its own State Farm corporate card and a possible Airlines Reporting Corp.-accredited Corporate Travel Department designation.
In the past several months, State Farm has retooled and expanded its e-mail reservation request form. The results have been a more consistent process for travelers and a better method of aggregating and applying travel data.
The current electronic form is the product of consolidating 28 different forms that had been used previously throughout the company. Now, travelers booking three weeks out or more--which accounts for more than half of all reservations--are requested to use the new form, available nationwide on the State Farm intranet.
Melinda Samp, supervisor of the State Farm Business Travel Center, said usage for bookings in that range has reached 97 percent. She added that the form enabled the travel department to cut three staff members and return those positions to other departments. "Although we have had more reservations this year," she said, "our reservationists have become more proficient and spend more time on customer service. They don't have to call travelers back, ask questions and play phone tag."
Not only does the new form reduce errors, minimize the need for subsequent communication between travelers and the travel department and drive other efficiencies, but it also provides a mechanism for comprehensive data capture. Indeed, once the standardized form took hold, State Farm began running internal reports on requested suppliers, booking dates, city pairs and other information.
"It has been very useful in that we don't have to depend on the agency. It is in our own hands," Samp said.
Meanwhile, State Farm in the past year updated its reporting process. Through McCord Travel Management, its consolidated agency, State Farm now receives bundled reports furnished by Hi-Mark and e-mails them directly to department heads.
"We interviewed several departments to see what they were looking for and then created new reports that help us see trends, cost-savings areas and monitor usage by carrier, for example," Samp said. "I used to get a FedEx box with 100 pages, now I receive it all electronically on a monthly basis."
As part of the restructured travel process, State Farm last year implemented a zone concept, whereby the company's 24 reservationists handle calls from a specific geographic region. Including corporate headquarters--which accounts for about half of the company's travel--the country was carved into four zones. The system identifies a traveler's region by area code when calling the 800 number and connects them to the appropriate zone.
"There is a higher likelihood of working with a reservationist that you have worked with in the past, one who has learned the area, flights and airports," Samp said. "It makes reservations more proficient and leads to better service." State Farm also consolidated all executive travel services into a single executive desk handling the company's 150-plus top executives throughout the United States.
Though not mandated, State Farm offers a third booking option through the GetThere self-booking tool. Currently, the system is used by 5,000 travelers with plans to extend that to another 10,000.
However, the increase in transaction and monthly maintenance fees has prompted a reevaluation of the product (BTN, June 25). Also, due to certain implementation "hiccups," State Farm opted to create its own profile form.
The company also completed new vendor contracts, including a new Trans World Airlines discount serving as a precursor to a new, larger American Airlines deal (BTN, June 11).
Overall, State Farm expects its annual U.S. booked air volume to remain at about $20 million for 2001 as a decreasing average ticket price offsets the slight uptick in tickets purchased.
The company also reached a new arrangement with Enterprise Rent-A-Car that went live in May. That deal includes a 24-hour billing cycle, consistent with other car rental companies but new for Enterprise, and liability damage waivers.
"Enterprise finally is moving on to airport properties and trying to be more of a business travel vendor," Samp said. "But you still cannot book them through the GDS and get the contracted rate."
State Farm also is looking at a few major initiatives to bring large elements of the travel program in-house. The company in the past year formed its own bank and currently is running a small pilot of a State Farm Visa card to test ghost card activity. The goal is to complete the pilot by year-end and begin shifting away from the American Express card early next year.
The entire travel agency function also soon may be in State Farm's hands as it seriously considers the merits of an ARC-accredited Corporate Travel Department certification. "We are working with a few other companies who are looking at CTD and interviewing others that are up and running to learn potential issues as well as enhancements," Samp said. "If a CTD doesn't make sense, we'll remain a rental plate, which has been a good fit, but we feel we are ready to take on more."
Also in the works is an enhancement to travel guidelines, hotel consolidation and a strong push for a paperless process aided by electronic itineraries sent out through the ResAssist system. Samp also plans to expand the travel intranet, which already offers weekly and daily travel alerts and certain program information.
Samp has been with State Farm for three years. She serves on McCord's client advisory board as well as those of American, TWA and Northwest airlines.