Supplier surveys, new global conferences and even participant counts at the National Business Travel Association convention here this week highlighted the expanding reach of transnational travel program management. The surveys showed that, despite its complexity, such development can help corporations cut costs.
In a survey of 181 clients, BCD Travel noted a 5 percent rise from 2005 figures, to 35 percent of survey respondents that have "globally consolidated" travel programs. BCD said North America and Europe dominated multinational travel consolidation for its clients, followed by Asia-Pacific, Latin America, the Middle East and Africa.
Tracking the extent of multinational travel management program consolidation over the past three years, BCD noted an average increase of 3 to 5 percent in the number of countries covered, with the most significant rise--12 percentage points--occurring in programs involving 11 to 20 countries. Sixteen percent of respondents said their companies' program consolidation has covered 30 or more countries.
In a survey it commissioned in late 2005 of 650 travel managers, including non-clients, and more than 2,100 business travelers across 12 countries, Carlson Wagonlit Travel found that 60 percent of travel manager respondents had some approach to consolidation outside their own country, with just 16 percent not consolidating and 21 percent noting it wasn't applicable. Of those with a global consolidation strategy, 26 percent said they are undertaking a comprehensive global consolidation initiative, 20 percent are consolidating piece by piece as the need arises and another 16 percent are consolidating over a period of time, by region. Interestingly, a comprehensive global consolidation strategy was listed by 30 percent of managers in the Asia-Pacific region, 29 percent of European managers, 23 percent of North American managers and 16 percent of managers in Brazil, which CWT said represents over half of the Latin American corporate travel market.
More than half of the travel managers responding to CWT's survey said cost savings is what senior management most expected the travel management program to deliver.
Consolidation through one agency delivers savings, according to a new American Express Business Travel white paper. Amex contended that organizations "can achieve best-in-class incremental savings of up to 25 percent as a result of sourcing, technology and process transformations." It cited a Killen & Associates report showing that travel and entertainment can account for 30 percent of indirect costs.
Analyzing 90 requests for proposals issued in the first five months of 2006 by large and small companies, Amex found that nearly all wanted management information, program management, consistent service delivery and service level guarantees, quality control and performance measurement, implementation planning and support, travel policy compliance support, reduced fares and preferred supplier rates, and online booking.
At least 70 percent of companies spending more than $10 million annually on air travel also requested a travel card platform and reconciliation process, value-added and consultative services, group travel and meetings management, travel safety and security, data protection, business continuity and disaster recovery planning, and compliance with local or industry regulations. Companies with air spend of less than $10 million had varying levels of interest in these services.
Providing a roadmap for developing a consolidation strategy, American Express recommended obtaining senior management support for data gathering by identifying the benefits of consolidation. With that support, Amex suggested creating a universal information platform that analyzes local and regional programs. Components of this analysis should include a clear understanding of annual T&E spend by market, current service configurations, current supplier deals and contract expirations and travel policies. With this detail, managers can create a business case that identifies the benefits of consolidation, highlights the critical success factors and quantifies the benefits in terms of cost savings, security and operational efficiencies.
Regardless of whether their programs today are transnational, it's clear that travel managers expect global capabilities from travel management companies. Nearly eight of 10 travel managers responding to CWT's survey ranked global operations as a very or somewhat important criteria for evaluating outsourced travel service providers. The top priorities, as ranked by managers, include customer service, experience, price, access to all airline inventory, data reporting, traveler tracking, global operations, supplier negotiations assistance, size based on transaction volume and wholly owned locations.
Global travel programs also require resources to manage. In the BCD benchmarking survey, 66 percent of those with "globally consolidated" travel programs said they dedicated resources to coordinate their programs.
Reflecting the importance of crisis management within travel programs, 83 percent of BCD clients said they use technology to track travelers, and 53 percent said those tools are global in scope.
Exemplifying the expanding scope of transnational travel management, NBTA noted a 190 percent increase (to 435 delegates) in the number of international travel professionals involved in global programs, compared to just 150 at last year's convention. With corporate travel professionals from more than 36 countries among the 5,500 convention delegates, NBTA also announced plans for conferences in China, Brazil and Mexico next year.