IBM, TRX and the U.K.'s University of Sheffield are among the sponsors of a new initiative led by the Association of Corporate Travel Executives' new Global Center to produce a report in six months on the efforts of corporations to reduce their carbon emissions, ACTE announced at its Global Conference in Miami this month.
Reducing carbon emissions shared the spotlight with next-generation technology and the growing influence of procurement on travel practices as the dominant themes of the conference.
ACTE Global Center chair Susan Hopley said the initial report, which will cost nearly $100,000, would assess the details, costs and results of companies individual carbon emissions reduction efforts. Companies that provide their data will get a copy of the initial report in exchange for their participation. Companies can pay $7,500 for an annual report or $10,000 for a biannual report on the ongoing findings of this research effort. Hopley told BTN that effort also has the support of U.K. governmental bodies and that she hoped travel management companies also would provide data to ACTE on their efforts to reduce and offset their corporate customers' carbon footprints.
A few large corporations already have completed a survey created by the University of Sheffield, which is conducting the research. Sheffield researchers also will examine the state of current governmental carbon emissions taxation efforts and the viability of existing carbon offset programs.
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ACTE also announced at the conference that it is encouraging corporate travel buyers to take the lead on demand management initiatives within their organizations and pursue "nontraditional means of communication," such as remote conferencing technologies, to replace nonstrategic travel, president Greeley Koch said.
ACTE said it is forming a committee to look deeper into travel alternatives, establish best practices and attain better data on demand management, a procurement concept that looks at eliminating, reducing or substituting usage. Through preliminary research, Koch said, "Companies are estimating 40 percent of their travel is for nonstrategic travel. In other words, 40 percent of the time, it's administrative travel. They're traveling from one office to another office to do things that are necessary for the business, but aren't revenue-generating."
Koch said more companies are exploring remote conferencing technologies as viable replacements for nonstrategic trips. In turn, Koch said, trips that offer more value to their companies could replace non-revenue-yielding travel. "We don't see that this is going to eliminate business travel," Koch said. "If anything, it will make the business travel that takes place more important since it's focusing on revenue-generating business travel. What we're hearing from companies is they have a set budget for travel. It's up to the division to figure out how to allocate. If they can reduce an administrative trip, they'll be sure to put in a revenue-generating trip."
ACTE executive director Susan Gurley said remote conferencing technology has improved so that it can be a valuable replacement for some business travel. "A lot of international law firms started this 10 to 15 years ago and decided it was the worst investment ever," Gurley said, noting that the machinery was "clunky" and ineffective. "The technology is now such that it's becoming more efficient. If it's not perfect today, it will be tomorrow."
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Representatives from major airline alliances Oneworld, SkyTeam and Star Alliance said alliance deals are not a good fit for every company, as buyers and consultants noted hits and misses in contracting a single deal across airline partners.
TCG Consulting senior consultant Barry Rogers said it is hard for companies to determine whether to contract with an alliance or individual carriers, but noted one client that negotiated individual deals, then went back to the alliance with better pricing. "I've seen them work well, I've seen them fail," Rogers said, adding that several companies that contracted with alliances returned to individual carrier contracts in the next negotiating cycle.
One buyer said a good deal of labor-intensive data analysis goes into determining if alliance deals are the right fit. He asked, "Why don't we just send you the data to determine if we should do an RFP?"
Star Alliance director of sales and market development for the Americas Nanci Cheberenchick said alliance deals "are not right for every company. If you're pricing together different contracts from different carriers with different points of sale, you're probably a good candidate."
Tom Milano, Delta Air Lines general manager of global corporate sales, said further globalization among companies, even midsize ones, are driving further SkyTeam contracting. "We're looking at accounts differently than we did before. You don't have to be a Fortune 500 company."
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Buyers need to be cognizant of changing technology influencing travelers, even changes that seem to be happening outside of corporate travel, said a pair of travel technology supplier speakers.
Such instant feedback sources as traveler blogs and podcasts aid travelers in booking decisions, and vendors are using these technologies to do the same. "These trends are more in the consumer market, then they find their way into our world," said Bev Heinritz, general manager of online booking tool GetThere. "There's new technology coming together that we all need to be watching, and we're looking at all the ways to blend these into procurement."
Such next-generation interactivity can affect preferred vendor usage, so companies should adjust their travel policies accordingly, said David Cerino, chief marketing and product officer for distribution technology supplier Farelogix.
"If your travelers challenge your choice of a hotel provider because their favorite road warrior's MySpace blog says that the hotel is being renovated, or a particular city podcast comes out and says that there's all types of construction around the hotel, then how is your hotel going to fare as a part of our total hotel program?" Cerino said. "If your policies do not support these types of travelers' expectations, then your policy could be affected negatively."
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With so much buzz around end-to-end travel and expense solutions, expense managers need to ensure such a system is a fit for their program, said a panel of travel buyers. Providers have been focused on linking online booking to expense reporting
(BTN, March 19), but Lea McLeod, director of travel and meeting services for Hewlett-Packard, said it's up to each company to decide what definition of "end to end" works best for them. The strategy doesn't always have to be global, as a regional or isolated effort in linking processes could be as effective, she said.
"The scope doesn't need to be 'boil the ocean' to be successful," McLeod said. "The challenge is to identify what you can do and where you can do it."
Bristol-Myers Squibb is implementing an end-to-end solution, said director of corporate travel services Lisa Jacobsen. BMS started in France and plans to expand to the United States. The keys were to focus on certain segments, map out a timetable, have standard operating procedures internally and detailed service level agreements for external suppliers, she said.
Linking processes doesn't work for every company, said Robert Ridpath, global travel manager for Nortel, and travel managers should avoid snagging the latest end-to-end claims on the market just to keep up with other expense managers.
"Jumping on the bandwagon and putting in an end-to-end solution is absolutely the wrong way to do it," Ridpath said. "You need to understand your processes."