Profiles In Travel Management: Card Corrals Conference Costs

Company: Cadence Design Systems Inc.
Headquarters: San Jose, Calif.
2005 U.S. Booked Air Volume: $7.5 million
2006 U.S. Booked Air Volume, Projected: $9 million


When Marcia Saurman arrived at Cadence Design Systems seven years ago as global travel manager, she first honed in on process improvements in the unmanaged travel program at the electronic design technology and engineering services company, tweaking policy and renegotiating with suppliers. In February 2005, she aimed to curb small, unmanaged meetings by implementing American Express' corporate meetings card, resulting in approximately 30 percent in savings for the company over the past two years.

Now director of global travel at Cadence, Saurman said the company has conducted 35 such meetings to date and that corporate meetings card use is extremely high, though Saurman is not able to capture 100 percent of all small meetings. The product continues to gain ground. "It's not widely deployed, but we're getting excellent usage on it and wonderful visibility of meetings spend that we didn't have any visibility into," she said.

At Cadence, the company's marketing department, which also uses the corporate meetings card, handles large meetings and events, but it previously lacked a management strategy for such small departmental meetings as those handled by administrators and managers. "Those types of meetings were being handled by an admin who would sign a contract with the hotel. There you have the risk of it not being mitigated or not understanding what elements were negotiable," said Saurman. "We were paying too much money and how the meeting was being paid for and accounted for was all over the place."

In 2004, Cadence's account manager at American Express, which serves as the company's preferred card supplier as well as its travel management company in Europe, presented Saurman with the corporate meetings card, which looks exactly like the traditional American Express corporate card, but is direct-billed to the company instead of the individual. Saurman immediately liked the streamlined process the product presented, viewing it as both a way to gain leverage with suppliers and a means for administrative assistants to facilitate meeting arrangements. "I worked closely with accounts payable and procurement, explaining that we could use this as a replacement payment vehicle," said Saurman.

Prior to the corporate meetings card, it wasn't unusual for Saurman to receive a substantial expense report that just said, "hotel."

"It wouldn't be attributed to a meeting, so there was no way for us to know what our spending on small meetings was," Saurman said. "We saw the corporate meetings card as a way to break out the meetings expenses and know how much we're spending."

In talking to administrative assistants, Saurman explained that by using the card, they would not have to do a purchase order or expense report. "We said, 'We'll pay for everything and do the billing and reconciliation,' " she noted. "They won't have to send out the contract through legal, because we'll take care of that. We are not meeting planners and we don't want to be. We just want to have the control factor and make it easy, convenient, efficient and give value to the end user."

Furthermore, Saurman stipulated in contracts that in order to be accepted into Cadence's preferred supplier program, a hotel must agree that no individual other than those in her department can sign a contract with the hotel for any type of event.

Though there were some issues to work through with accounts payable due to Sarbanes-Oxley requirements, Saurman said it was a smooth transition and she began to see immediate results. "One of the first things we saw was a 25 percent increase in the total dollar amount put through on Amex overall, which helped us achieve our minimum spend threshold to qualify for our dividend payment," she said. "It continues this year as well."

Another big difference, Saurman said, was in the billing and payment process.

"It's paid through accounts payable," she said. "We're writing one check a month to American Express instead of cutting multiple checks to suppliers that we employ for various events. It's controlling risk, leverage, preferred suppliers and spend and it brings us to a threshold where we can achieve an incentive."

Though American Express offers a reconciliation tool for the corporate meetings card, Cadence has yet to implement it. Saurman said it is on her radar for 2007: "There's always room for improvement, but we've come a long way."