Profiles In Travel Management: Novartis To Leverage New Global Travel Policy - 2008-04-28

Company: Novartis
Headquarters: Basel, Switzerland
Annual N.A. Tickets Issued: 100,000

Novartis International recently began rolling out a global travel policy that will serve as leverage in its inaugural global air bid launched in March and in an ongoing revision of its hotel program.

The firm's travel team targets a 100 percent agency compliance rate by taking a hard-line approach, including potential nonreimbursement, against out-of-policy bookings made outside preferred channels.

The new policy aims to achieve compliance through well-defined and firm approval procedures, most notably the "one-over-one" exception rule, which requires any non-lowest logical airfare or out-of-policy bookings to be approved by the traveler's supervisor's manager, who in a "relatively flat" organization like Novartis is fairly high in the management order, said Paul Tomaszeski, executive director of Novartis Pharmaceuticals business support services. "When most travelers hear what the process is for getting the exception approved, they fly on the original in-policy flight," he said.

For offline bookings, Carlson Wagonlit Travel agents receive travel reservation request information and provide an air itinerary with the lowest logical airfare.

Online transactions are subject to the one-over-one rule as well. A dedicated agent in CWT's Canadian call center monitors online transactions made through Novartis' CWT Horizon booking tool and will not issue a ticket for an out-of-policy request.

To further drive compliance, Novartis has reserved the right to deny reimbursement for bookings not made through CWT agents or Horizon. To make transaction fees more visible, Novartis charges the air ticket transaction fee back to each traveler's corporate card.

The global policy first launched in the U.S. pharmaceuticals division and the New York corporate office last November. Eventually, it will cover all of Novartis' 98,000 employees worldwide, but the travel team has built flexibility for local operations, which are then reviewed and authorized by Basel, Switzerland-based global category manager of business travel David Coulson.

"We could focus only on savings with the potential to delay travelers with less than high-quality service and numerous connections," said Coulson. "That is not in our travelers' interests and certainly not in Novartis' interest."

The company's first global air bid includes about 100,000 annual tickets issued in North America alone. Novartis sent out requests for proposals in March and held a bidder's conference.

"Part of what we are explaining within the RFP is that our new policy will really drive our marketshare to preferred carriers," Tomaszeski said. "Carlson basically owns that booking, and they are driving and selecting the carrier and flight the traveler is going on, so it should align itself with our discounts and lowest logical airfare rules and drive share."

A travel steering committee made up of senior-level executives, including the CEO, recently adopted a global category management role, and now takes a project approach to making such policy changes as instituting a tracking process to measure compliance by country, division or department for key performance metrics like advance airfare purchase.

The company also is using CWT to push hotel program compliance, but has built in exceptions for meetings. Tomaszeski's team tweaked the policy to move travelers to mid-tier hotels that "are suitable to business travel, but offer some favorable rates, last-room availability and late cancellation clauses."