Business Travel News last month announced Richard Wooten, director of corporate travel for Lockheed Martin Corp., is the 2005 Travel Manager of the Year. BTN editors selected Wooten for pushing the automation envelope with Lockheed Martin's travel management partners to develop and implement real-time pre-trip approvals and alerts and unused-ticket exchange technology.
In addition to overhauling, consolidating and mandating global corporate travel policy, Wooten last year expanded Lockheed Martin's travel program beyond the United States, Canada and the United Kingdom to include 23 other countries. He also persuaded a low-cost carrier to provide corporate discounts and content to global distribution systems, both firsts for the carrier.
A 10-year industry veteran, Wooten has been at the forefront of travel management technology and automation since joining Texas Instruments more than one decade ago to work on one of the first corporate self-service initiatives. Before his arrival at Lockheed Martin in 2001, the firm used two travel agencies, had disparate, soft policies and no online booking tool. Today, Lockheed Martin is globally consolidated with TQ3Navigant, maintains a single, strongly worded umbrella policy for its 57 business units around the globe and drives 82 percent of its bookings online through GetThere's DirectCorporate tool.
Of all the accomplishments of the Lockheed Martin travel team—which is comprised of four travel subject experts and a procurement-trained project manager—Wooten considers the global policy launch the most significant.
"Back in the first part of 2003, I recognized that we needed to certainly strengthen our policy. I know everyone doesn't like the mandate word, but we needed to put some stronger language in the policy that would improve our usage of self-service and then definitely support our improved travel suppliers," Wooten said. "We took the approach to apply our LM21 program—essentially the Lean and Six Sigma processes that we use throughout the corporation—to look at corporate travel policy, which is unique. That was the first time at Lockheed Martin that we used Lean and Six Sigma in that way."
As Wooten does with most travel initiatives that require substantial corporate cooperation and senior management buy-in, he organized an "Operating Excellence" event, bringing together representatives from the company's corporate finance, corporate treasury, expense management and travel departments to address, dissect and retool policy.
"We just went through the policy and took apart each piece of it and did some brainstorming, research and reporting to understand things like, if we change a statement in the policy, what financial impact it would have on the corporation. It took about a year, start to finish," he said. "The policy is owned by our CFO, so we had to have that senior management approval to make it happen. It took a lot of behind-the-scenes encouragement and we really had to lay out a good business case for everyone to buy in."
In addition to helping drive compliance and lowering corporate travel management costs, Wooten said the policy—implemented in the first quarter of 2004 and achieved through rigorous procurement-led processes—offers Lockheed Martin increased flexibility for its program. "If we needed to change TMCs, it would be much easier to make the transition because they would only have one policy to adhere to. That's also a big piece of reducing cost, because it takes labor and time to go try to administer so many different policies," he said.
By mandating use of company-approved hotels, Lockheed Martin's U.S. hotel program compliance soared from 45 percent in 2003 to 70 percent in 2004, and experienced a 29 percent increase in overall travel agreement savings during the same period.
"From 2002 through 2004, we were able to decrease our total hotel spend about 9.5 percent while we increased the number of booked rooms by 11 percent," Wooten said, noting that such savings may be harder to show if room rates rise during the next few years. "One of the things that certainly drives savings in our hotel agreements is our use of reverse auctions. We did seven last year for the 2005 program, for specific, high-volume markets. We did the analysis and found that it's certainly still delivering savings, so we've expanded to 15 market cities for this year."
Wooten's focus on driving program compliance in key markets enabled him to leverage opportunities with two low-cost carriers, one of which had never offered corporate discounts. By presenting the clear value of doing business with Lockheed Martin, which booked $206 million in U.S. air volume in 2004, Wooten last year undoubtedly influenced Independence Air's decision not only to begin listing fares in GDSs, but also to offer his firm corporate discounts on all fares—a prerequisite for Lockheed-approved suppliers.
The company this year implemented a similar business model for its newly minted relationship with AirTran, already a GDS participant.
"We were looking at redoing all of our contracts toward the end of last year. One of the things we saw was that there was some opportunity for some low-cost carriers, specifically in some niche markets where we had some non-approved carriers that were doing pretty well," Wooten said. "We look at air just like we would as if we were purchasing computers or any other commodity. We buy in great volumes and we expect a discount on all fares. That was one of the big hurdles that the carrier had to get over. The other piece was, because we have 82 percent self-service, the way we're structured today those bookings would have to go through our GDS channel. That was another hurdle and once those were jumped, then they were brought into the program."
All told, the negotiation process with Independence Air took roughly six months and "quite a bit of convincing." After presenting the carrier's senior management with detailed analyses of the opportunity at hand, Wooten said its top executives realized the mutual benefit of agreeing to the terms of Lockheed Martin's supplier program. "We had many discussions about their opportunity to get to the marketplace and, once they saw the results and the benefits from Lockheed Martin on this, they found that other corporate clients were willing to participate and that expanded their business. I think they found that it was a win-win," Wooten said, noting that having access to corporate-approved, low-cost carriers has had the added benefit of increasing Lockheed Martin's leverage in dealings with the legacy carriers. The addition of these low-cost carriers has contributed to some of the success of the company's air program during the past few years. From 2002 to 2004, he said, airline cost remained flat while the number of trips increased 12 percent. The company's average domestic airline ticket price fell 12 percent from 2001 levels.
Working closely with vendors to develop mutually beneficial travel management solutions has become an integral part of Wooten's day-to-day operations. Through open communications with agency partners TQ3 Navigant and GetThere, Wooten has initiated the development of several innovative technologies that since have benefited other corporate travel managers.
In early 2004, Wooten began looking at the possibility of developing a rules-based policy alert system and, after holding several weekly meetings with the team at TQ3, ultimately developed and launched the PolicyFlyr exception-reporting product in the fall of last year.
"One of the challenges that we have in running a program this size is communications to our travelers and getting the right communications into the hands of the right person to have any effect," Wooten said. Every time a traveler books out of policy, he added, "You can go through and pull reporting and go look up e-mail addresses and try to send out information manually, but that is a tremendous effort. We wanted something that was automated, something that would go out in the background and look for opportunities and then just automatically send out the e-mail notification."
By configuring an automated, flexible, rules-based, booking review system, Lockheed Martin maintains control over which booking behaviors will be red-flagged for employee alerts and what exactly those alerts will say.
"We can go in and configure a rules-based e-mail ourselves, being the travel department, and put in the text of the message or change the text of the message if we need to do that periodically," said Wooten. "Currently, the noncompliance alerts go just to the traveler. We want to have it set up for some policy questions to go also to the employee's manager. That sounds easy, but it's not easy to do."
Wooten said the Lockheed Martin travel team identifies new rules and exceptions daily, making the system's flexibility key to its functionality. Just recently, he noted, the company realized it should flag bookings that do not conform to the Fly America Act—which requires travelers flying on federal government-funded business to use U.S.-based carriers—for e-mail alerts. "What we want to do is have the system scan to see when a non-U.S. flight carrier is purchased, before the trip's taken," he said. "An e-mail would then be sent to the traveler and to the traveler's manager to warn them that there could be some consequences if they don't change that back to a U.S. flight carrier."
In the second quarter of 2004, Lockheed Martin held another Operating Excellence event to address the cost savings that could be realized through automating the exchange of unused and nonrefundable tickets. "It was really a two-phased approach. First, let's get the info in front of the travelers to make them aware that they have unused tickets and tell them how they can reapply those tickets. To do that, we worked with both GetThere and TQ3," Wooten said.
Once the partners had determined how to feed information to the online booking tool and display it to the end user, they tackled the second phase of the process—automating the unused ticket application. "Now, when the system recognizes an unused ticket, TQ3's quality-control system looks for those kinds of opportunities and automatically gives it over to an agent to try to apply the exchange. That was really a difficult task for TQ3 because the ticket rules are not uniform from airline to airline, or even within the same airline." Wooten implemented automated ticket exchange in March of this year and has, to date, seen a 12 percent reduction in unused tickets.
In the coming year, Wooten will work with GetThere and TQ3 to develop a system for booking and tracking recruited job applicants. "We've got another Operating Excellence event scheduled in September," he said. "GetThere has indicated that they have some capabilities now that you can either enable the recruiter to book online for the applicant or actually have the recruiter send the applicant one-time access to book his or her own travel. Of course, the recruiter would have pre-approval ability once the applicant has purchased their travel. That's a big area and a big opportunity for us and we're going to focus on that."
Streamlining the ticketing process and improving touchless transaction rates remain high on Wooten's list of priorities in the coming year. This year, the company implemented a same-day ticketing system to accommodate the automation of records and fulfill traveler expectations.
"We were running into issues with travelers getting to the airport not having a ticket. We dug into that and found that it was primarily travelers that had a travel arranger. They would call in, they'd book a trip, tell the agent to hold it and then forget to call back, then hand over the preliminary itinerary to their manager and when they got to the airport, of course, there was no ticket," Wooten said, noting that eliminating ticket holds facilitated instant ticketing upon reservation completion. "The traveler's expectation was, 'Why didn't you instant ticket?' That was the experience they received if they went out to different Web sites because that's all instant."
With an 80 percent touchless transaction rate, Lockheed Martin may be closing in on its self-service threshold, but Wooten and his supplier partners are determined to further push the company's first-pass yield. "On the touchless side, a lot of the effort was what Lockheed Martin required TQ3 to document in the edits portion of the PNR. We went through and looked at all the edits that we were capturing and really tried to understand why we were capturing this information," said Wooten. "We found that with a tremendous amount of it, we weren't doing anything. We went through each one and said, 'Is this an impediment to getting you to touchless?' Then we'd focus on those and drive as many of those edits out as possible." The company's emphasis on of self-service contributed to a dramatic decrease in TMC costs during the past three years. Between 2001 and 2004, he said, more streamlined booking processes drove TMC costs down 46 percent.
While Wooten works towards increased automation and cost savings, globalization and further consolidation of the Lockheed Martin travel program continue to serve as a backdrop for all of the team's efforts. In 2004 , the company added 23 countries to its travel program, which previously included only the United States, United Kingdom and Canada.
"One of the things that enabled us to do this is the arrangement between the joint venture of TUI and Navigant in the United States. Up until that time, our approach was that if we wanted to go global, we'd have to go negotiate for 26 different countries and we really didn't want to go down that path. Having TQ3 at one point really helped facilitate that," said Wooten. "The only area that we have a presence in that we haven't gone into is South America and we're taking a look at that right now."
BTN has recognized Wooten before, as a Best Practitioner of 2002 for raising the efficiency of the travel agents serving the Lockheed Martin account
(BTN, Aug. 26, 2002) and as a Best Meetings Practitioner of 2004 for deploying companywide meetings policy and technology, an honor he shared with Lockheed Martin travel commodity manager for global hotels and groups and meetings programs Frank Melesky
(Meetings Today, Aug. 2, 2004)Though Wooten reports into the company's strategic sourcing division and often refers to travel as a "commodity," he places a high personal premium on the free flow of ideas among the company's travel management partners. "It's a team approach, but TQ3 is definitely receptive to my ideas. That's the thing I like. They never come back and immediately say no. They say, 'Let's go work on that. Let's go study that. Let's go see if we can make it happen.' That goes a long way for me."