In creating a travel program meant to resemble a Fortune100 corporation, the state of California, which spends more than $200 million annually on travel, recently consolidated to a single travel agency from 157. The state's department of general services, which oversees travel, also implemented a green hotel certification program and introduced an online booking tool.
"Since we have gone to one travel agency, we have provided an opportunity for state departments to see every day what their travel spend is," said California statewide travel manager Donna Carey. "They have never been able to do that before. We have been trying to think smarter and trying to think more like a corporation.
"One of the things that we have been tasked with is to provide transparency, consistency and uniformity for all of our state departments," Carey continued. "We have an easy process for all of the state departments to follow, and when everybody can do it the same way, it makes it easier instead of people trying to move mountains on their own. We have already moved that mountain for them, so it should be easy for them to reconcile their travel, see who's traveling and view their travel reports every day if they need to."
In April, California signed Travel Store Inc. as its sole travel management company for a two-year contract worth a maximum of $1.7 million. As one of the 157 agencies previously serving the state, Travel Store charged a $15 transaction fee for telephone reservations and a $10 online booking fee. Now, after consolidating all travel with Travel Store, California's booking fees are $10 for agent-assisted bookings and $5 for online transactions.
California also signed up with Concur to use the Cliqbook online booking tool. A tool developed by Travel Store for the state encompasses both Cliqbook and Southwest Airlines' Swabiz corporate booking site, which is loaded with California's negotiated rates.
Still, pushing for adoption of online booking is a challenge. "It's hard to change the way that you have always done something when you have always called the travel agency in the past," said Carey. "One of the hardest things for us is to change the culture. My young staff is very excited to move forward but when they have to go out and meet with the older staff, it is not as easy to get them to move."
For expense management, California uses a system developed by IBM. Carey hopes it eventually will integrate with the booking tool. The state uses centralized American Express accounts to pay for travel-related expenses.
California officials expect that the statewide T&E spend of $200 million will grow during the current fiscal year now that 9,600 public schools across 1,100 districts can access state government funds for travel. Now, about 435,000 employees can apply to use funds from the travel budget. That covers 250 state departments, 479 cities, 58 counties, 110 community colleges and 23 state universities, Carey explained.
Although California still is under pressure to reduce discretionary spending and monitor a growing deficit, travel continues. This summer, for example, state travelers went on trips even as California lawmakers struggled for 100 days past the due date to finalize a statewide budget.
"You still had business to conduct on behalf of the state of California, and fortunately our correctional officers are still picking up inmates across the United States; those things do happen. You just don't stop," Carey said. "Travel is one of the areas that lawmakers, state departments or even the governor always looks to cut. They always think that's easy. A lot of departments now have to receive approvals before they do travel. Certainly our systems [make pre-trip approval] available to them."
In terms of policy, any type of business class fare is strongly discouraged. The state only pays "for the cost of the ticket and one bag per traveler," Carey said, adding that "if a baggage fee is paid at the airport, the traveler must submit the receipt for reimbursement."
Going Green
Since 2008, California's travel department has sought to grant each hotel property within its program a green stamp of approval. The department tasked 13 individuals with visiting each of the 6,500 properties and rating them based on an internally devised scale. Hotels are rated on commitment to green practices, recycling, use of energy-efficient equipment, water conservation, landscaping, transportation and how they purchase goods, according to state materials posted online.
Should the state review a hotel's green credentials and find them lacking, the travel department drops the property from the program.
Meanwhile, now that California plans in 2012 to begin construction of a high-speed rail line between San Francisco and Los Angeles, Carey is preparing to incorporate trains into the travel supply chain. She said she has been considering rail for a number years by examining rental car volumes and estimating savings should high-speed rail serve as a suitable alternative.
Mixing In Meetings
California's travel department this fiscal year added meetings management to the mix. After creating an onsite meetings and conference unit, Carey estimated the team now is responsible for $50 million in meetings spend, though that number could grow as the state gets a better handle on measuring total expenditures. Since July, California booked 333 meetings.
Most meetings are centrally billed through an American Express ghost account, though some state departments use a meetings credit card. The state currently is drafting a request for proposals for an online meetings tool to accommodate bookings and monitor spend more closely, according to Carey.
On The Horizon
To secure hotel rooms for state employees during emergencies, Carey is developing an emergency lodging program that would coordinate with the federal government and hotel operators.
"We do have a lot of fires out here, and we are working closely with our Office of Emergency Services to develop a program so that we can provide help to [travelers], so they are not having to figure out where are they going to find lodging," she said. "We are making sure that other groups [from outside the state] aren't coming over and taking over our lodging. We found that our staff had to stay so far away because the federal government came in and took over."
Other goals include consolidating taxicab receipts by centrally billing them to the state comptroller's office and striking agreements with taxi companies for consistent fares on specific routes, such as Los Angeles International Airport to downtown Los Angeles. Said Carey, "When [receipts] go to our state comptroller's office, they are looking for uniformity and consistency."