Stone Rolls Out Universally
London - With a responsibility for travel everywhere outside of the United States, Tom Stone—director of travel management for Universal Music International and chairman-elect of the U.K.'s Institute of Travel Management—directs much of his energy to finding the elusive balance between harnessing the benefits of a leveraged global spend and allowing local markets to manage themselves. Stone considers his work to consist of two main duties: Acting as internal consultant and central repository of information for each national market and, he said, "being there when the wheels fall off."
An example of how he seeks this balance was with the selection of travel agencies after he joined Universal in January 2002. Stone decided against consolidating with a single agency worldwide because he believed no one travel management company is the best in every national market. Nevertheless, one of his priorities when he joined was to insist each country reduce to a single agency nationally because of the benefits of consolidated data, ease of communication and economy of scale.
The choice of agent was left to managers in each market. However, this does not mean the travel program is fragmented, Stone said. "I have viewed travel management companies for some time not as suppliers but as an outsourced service," he said. "We spend money through them rather than on them. We are much more rigorous as regards our true suppliers, where we need the benefits of leverage. In terms of policy enforcement, on a scale of one to 10, we hit an eight. Eighty percent of our spend is with preferred suppliers but if an artist's manager flies with a nonpreferred airline, it would be stupid for our executive not to take the same flight as them."
Stone receives exception reports daily, but said they are not lengthy. "We try to accommodate people's needs in the policy," he said. Examples include having two preferred transatlantic carriers—one British and one U.S.—and negotiated deals with most of the European flag carriers.
The strategy works well enough for suppliers. Proven examples of him moving marketshare to preferred hotels have helped establish credibility. What also adds steel to the Universal program is the quality of its management information. Universal used to be part of Seagram, where Stone previously reported as head of European travel to Earl Foster. One of the main lessons Stone learned from his time at Seagram was a unswerving belief in the power of data warehouses to consolidate spend data on a global basis. As was the case at Seagram, Stone uses the warehouse now called TRX. He finds TRX particularly well-suited to the Universal culture, as it deals with the potential problem of having a variety of data sources, such as the use of multiple travel agencies. Additionally, Universal does not have an extensive payment card program, which would be an alternative form of consolidating data. Not distributing cards freely is a legacy of music industry executives' reputation for profligate spending. Therefore, the data warehouse has been the glue that binds his travel program together. "Without TRX, it would be very different," he said.
Every bit as important as managing the cost of travel is delivering a high quality of service. Stone is responsible not only for executives' trips but also for the travel elements of promotional and performing tours by the company's recording artists. Stone frequently has to book each member of a band into a separate hotel because they loathe each other—but, he said, "there are just as many prima donnas in a bank." Most of the artists' demands, he finds, are for genuinely good reasons. What might appear to be the extravagance of chartering a private aircraft is usually because the tour schedule is too tight or too prone to change for scheduled air to be an option.
Stone's projects for the year ahead include further rollout of the OAG online schedule planner, which he has started to introduce in the United Kingdom. It is, he said, a stepping stone to possible introduction of an online booking system. Also on his agenda is encouraging more low-fare options where appropriate, including using budget carriers plus the new generation of restricted midweek fares from BA and other European airlines, and also the super-economy long-haul products of such airlines as BA and United. Other cost-containment measures include introducing a greater range of accommodation types in each city and rolling out a mandated telephone calling card. "We are hemorrhaging money on overseas calls, especially when our people use their laptops to go online," he said.
Stone also has ambitions for his chairmanship of ITM, including working closely with other travel management organizations, stepping up its almost nonexistent lobbying of U.K. and European governments and developing travel management educational programs. .