Amex Europe Head Herrick Pursuing Growth
One year after a promotion to senior vice president and general manager of American Express Business Travel in Europe, the Middle East and Africa, David Herrick in late October in Munich met with BTN editor-in-chief David Meyer to discuss the division's rapid growth, streamlined operations and plans to match the size of Amex's North American counterpart.
BTN: What have you done in your first year?
David Herrick: Much of my first year has been around some basic things and making some organizational changes. I've brought in some people from the outside of the industry and some terrific ones from inside, and we have a nice balance now. I'm a big believer in getting the organization right first and the rest will come.We've got a great organization and some terrific people. For example, Marc Hildebrand, who ran TQ3, is running central Europe and Russia for us. We're increasing our sales force and pulling in more product people.
BTN: How many people do you have?
Herrick: We have 6,500 in Europe. The majority of them are front-line agents. We've probably got 300-plus sales and client general managers out in the marketplace. We have a number of marketing people and advisory services. Sales and client people have to know everything about their customer and everything about the business. There are certain times when they have to be the expert, but other times they need to rely on our product people or our advisory people or whoever to come in and assist with a specific challenge. Within the marketing group we've got specific product people. We have people on the distribution side in the supplier relations group. Our setup is very similar to what you would find in North America, but to a lesser degree in terms of numbers. In Europe, I have 18 markets that make up my region and you have to take into consideration the local cultures. We operate in four subregions. I rely on the heads of each of those from a local perspective on what's going to make it work for us in that market.
BTN: What are the regions?
Herrick: The Nordics: Sweden, Denmark and Norway; U.K. and Ireland; Germany, Austria, Switzerland, Central Europe and Russia; France, Benelux, Spain and Italy. We're very good at providing a global product. What we've got to find is that balance to help our customers. We've rationalized our service centers in Europe. We used to have 50 business travel centers in France. Now we have seven. That happened over the past two years. You'll see that throughout Europe. In the U.K., we had probably 15 or 18. Now we've got one or two in the London area, one in Birmingham and one in Newcastle.
BTN: What is the next major goal?
Herrick: For me, it's all about winning in this marketplace. We're clearly the largest, if not one of the very largest in Europe. We've got to put some water between us and the next players. We've got to go out and take advantage of that key midmarket business. The number of Fortune 100 companies is pretty equally split between America and Europe. When you look at the demographics of Europe, there's no reason why we can't become the size of North America.
BTN: Do you have a percentage growth goal?
Herrick: Our new business is up a very healthy 34 percent this year. That is a combination of some global wins and some regional wins. We'll continue to put a big emphasis on growth. Also, American Express is known as a quality service provider across its product lines. We are that in travel, but are we where I feel comfortable? No. There are clearly opportunities there. We should be known not only as the largest, most comprehensive travel management company, but also the one with the absolute best service. People need to know they are going to get a standard level of service consistently, wherever they work with us. We are doing well, but I'm not ready to say we're there.
BTN: Thirty-four percent growth will be tough to duplicate in 2008. Will you?
Herrick: It is a tough number. There's a lot of large business that's coming into play next year. We just want to make sure we're out there with a value proposition that resonates. The transaction is a small piece of the overall cost. We want them to see that the value we bring is much greater than that. We've got a lot to offer and we can save them much more money.
BTN: How does demand look from Europe?
Herrick: It looks pretty strong. We haven't seen any effect from the United States, although generally in Europe if the United States sneezes, we catch a cold. Certainly our sales and transaction growth continue to be strong.