1 / 82

Fundamentals of Business Travel Bangkok, 6 October 2008

Fundamentals of Business Travel Bangkok, 6 October 2008. Facilitators. David J Lorimer Manager Government Travel Strategy American Express Business Travel Karen Davies Regional Director, NBTA Asia Pacific. Agenda. Section One: Components of Business Travel Section Two: Technology 101

Download Presentation

Fundamentals of Business Travel Bangkok, 6 October 2008

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript


  1. Fundamentals of Business TravelBangkok, 6 October 2008

  2. Facilitators David J Lorimer Manager Government Travel Strategy American Express Business Travel Karen Davies Regional Director, NBTA Asia Pacific

  3. Agenda • Section One: Components of Business Travel • Section Two: Technology 101 • Section Three: Trends & Forecasting • Section Four: Groups and Meetings • Section Five: Safety and Security

  4. Agenda – Section One • Components of Business Travel • Travel Procurement • The TMC • TMC Value Proposition • TMC Value Proposition • Key Travel Categories • Distribution • Travel Program Management

  5. Travel Program Best Practice • A well rounded travel management program should have the following goals: • Improved service to the traveller, recognising safety and security; • Better control of travel expenses; • Cost effective purchasing of travel; • Practical procedures for implementing corporate goals; and • Achievement of total quality management of all aspects of the travel services program.

  6. Travel Procurement • The Role of the Travel Manager • The Role of the TMC – Travel Agency Relationships • Partnership • Commodity • The Role of Technology • Bringing Value to the Travel Program • Travel Policy

  7. Travel Procurement – Role of the Travel Manager • Multi-faceted function • Service … Quality Control … Analysis … Purchasing • Key skill concepts: • develops • implements • oversees

  8. Travel Procurement - Responsibilities • Creation and distribution of travel information • Corporate travel website • Traveler safety and security issues • Counsel and advise travelers on matters relating to travel planning • Manage supplier relationships • Measure supplier performance

  9. Travel Procurement - Responsibilities • Establish and lead a company travel team • Liaise with purchasing / procurement • Develop and manage department budget • Serve as corporate card administrator • Develop and analyse travel management reports • Develop and track key metrics

  10. Travel Procurement - Responsibilities • Corporate culture insight • Understanding of Travel Management Fundamentals • Travel Management Foundational Elements • Travel Policy • Travel Management Company • Technology • Excellent Vendor Relationships • Restate into Numbers

  11. Travel Procurement- responsibilities must include … • Focus on Customer Service • Identify Key Measures (less is more) • Measure and Report • Reassess • Communicate • Levers of Service, Savings and Control

  12. A decade + of mergers and acquisitions has reduced the number of competitors Who fits your program? Mega Regional Local agency The emergence of online booking tools and the ITMC – Internet based TMC GetThere Concur (Cliqbook) Travelocity Expedia The TMC – Travel Management Company

  13. The TMC - History • 1970’s – late 90’sA travel agent remunerated by commission for booking • Late 90’s to circa 2002A travel manager remunerated by fees (TF and MF) • 2003 +Increasingly an integrated travel management business partner

  14. The TMC – TMC Configuration Options • Full service agency • On-site agency branch (implant) • Regional Reservation Centre (call centre) • Fulfillment center for online bookings

  15. The TMC – Selecting the right TMC • Step one – be patient • Step two – RFI / RFP process • What are you looking for? • The right corporate culture fit • Quality service for travelers • Levers of Service, Savings and Control

  16. The TMC Value Prop – 3 Pillars- Service • Balance of Online / Offline • Transaction fee remunerates TMC per touch, Management Fee remunerates on cost of travel – Which one suits you ? • Level of Touch • VIP’s • 24 hour • Basic ‘out of country’ touch

  17. The TMC Value Prop – 3 Pillars- Savings • Soft and Hard Savings • Supplier Negotiation • Online adoption • Supplier Savings • Maximise buying power - consolidation of spend • Change in ATP (airlines) • Address internal booking workflow

  18. The TMC Value Prop – 3 Pillars- Control • Client Manager importance • Accurate Data Critical • Historical and live data • Manipulation of data • Market share monitoring • Supplier target monitoring • Supplier Shift !

  19. Key Travel Categories • Air • Hotel • Car • TMC

  20. Distribution – The Distribution Channel • The process used for suppliers to get their products and services to the customer • The distribution costs have had major effects on the airlines and GDS systems

  21. Distribution – How do Travel Principles distribute their products? Up to late 90’s • Traditionally Principles encouraged consumer to go via agents – little or no direct distribution. From late 90’s Principles focus on cost of distribution – move to direct distribution

  22. Distribution – Direct Distribution • Call Centres • Direct Principle owned and run websites (www.qantas.com.au) • Content Aggregated Website(www.wotif.com, www.asiabeds.com)

  23. Distribution – Indirect Distribution • GDS (CRS) – Global Distribution Systems • The Supermarket! • Air inventory • Hotel inventory • Car inventory

  24. Distribution

  25. Distribution – Global Distribution Systems • Sabre • Galileo • Worldspan • Amadeus

  26. Distribution – Distribution Today • Non GDS Direct Airline (and other Principle websites ) • Non GDS Content Aggregated Websites (www.asiabeds.com) • ITMC (via GDS and direct link to principle) • TMC (via GDS and direct link to principle

  27. Distribution • Distribution of airline inventory is a major point of discussion • Will the traditional GDS survive? • Airlines and Principles continue to push customers to their direct connections

  28. Distribution Corporation Commissions & Overrides Rebates Transaction Fee Charges Travel Agency Corporate Card Air Carrier Commissions & Overrides Payment Volume Incentives Government Taxes CRS / GDS Segment Fees

  29. On-going Program Management – Bringing Value • Quantifying the financial benefits of a well managed program • Keeping management and travelers informed as to negotiated savings, new technologies like online booking systems and potential future savings • Knowledge of Market Share Regulations and SOX requirements • Cost containment

  30. On-going Program Management – Travel Policy • To be successful, a well thought out policy must be readily available to travelers in the form of an accessible manual. • Travel policy should be: • Fair and equitable • Leave little to individual interpretation • Clear terminology (not necessarily travel terms) • Cost containment should be the principal purpose

  31. On-going Program Management – Travel Policy • Good travel policy is developed by a team from all appropriate departments (finance, HR, administration, sales & marketing) • Rules unpalatable to the creators will be equally unpleasant to the traveler • Keep the policy current to reflect low cost carriers, industry events and political issues

  32. On-going Program Management – Travel Policy Travel is not a PERK! Success of any travel management programs depends on: • Company Culture • Company goals and objectives • Management Support • Communication Skills • Travel Industry Knowledge • … common sense

  33. On-going Program Management – Dealing with Airlines • Airline ticket costs – up to 70% of your travel budget • 1978 – deregulation in the United States • 2003 – Simplified pricing • 2006 – GDS Content Removal • The impact of LCCs – low cost carriers • Will the growth of LCCs impact your business? • Tiger Airways, Virgin Blue, Jetstar etc.

  34. On-going Program Management – Dealing with Airlines • Airline agreements / contracts take many forms: • Domestic vs. transborder vs. international • Back End • Zone fares • % off discount • All are based on volume – market share • What about travel amenities / soft dollars?

  35. On-going Program Management – Controlling Hotel Costs Asia Pacific forecasts for 2008 • The landscape is changing with traditional low seasons shrinking and hotels forging ahead with new models. Source: AMEX 2008 Global Travel Forecast

  36. On-going Program Management – Asia Pacific Country Forecast Increases for 2008 Source: AMEX 2008 Global Travel Forecast

  37. On-going Program Management – Controlling Hotel Costs • Hotel pricing factors • The supply of available rooms • Are new hotels being built? The cost of construction. • The demand for rooms • The economy • Global, national, local • Significant global events: 9-11, London bombings • Distribution costs

  38. On-going Program Management – Controlling Hotel Costs • Steps to Control Costs • Lease rooms where traffic warrants • Preferred rate programs • Negotiate rates net of commissions • Eliminate no-show charges • Secure LRA room rates • Include amenities • Breakfast, health club charges, high speed internet access, local and 800 phone calls, free shuttles

  39. On-going Program Management – Your bargaining position • Know your numbers and possible usage • Number of room nights used • Stay pattern • Meals taken at the hotel • Use of concessionaires • Meeting and Group functions

  40. On-going Program Management – Car Rental Costs • The least controlled travel service • Car costs versus taxi / limo transfers • What is negotiable? • Car size, insurance, refueling options, GPS • The “perks” – Hertz Gold, National Emerald Aisle • WATCH for check-in counter offers • Upgrades, insurance waivers, satellite radio

  41. Agenda – Section Two • Technology 101 • Assessing technology needs • Travel spend • Technology tiers • Front end technology • Mid office technology • Back office technology

  42. Technology 101

  43. Role of Technology It’s not about the software; it is the solution … what you want to accomplish

  44. Role of Technology - Terminology • Front end - profiles / pre-trip approval / reservations • Mid office - quality control • Back office - data collection & reporting / expense management • GDS • SBT / OBT

  45. Role of Technology POINTS TO CONSIDER: • What kind of data do you need vs. want? • Why is data so important?

  46. Role of Technology - 3 Key Data Streams • Booked data • PNR data • Billed data (or spend data) • Has the greatest value for negotiations • Expensed data • Represents the REAL costs to the company and has the greatest direct effect on the company

  47. Role of Technology – Travel Technology Costs Three primary areas of technology cost • Online booking and fulfillment • Data management • Automated expense reporting

  48. Role of Technology – Online Booking and Fulfillment • The phenomenon of visual guilt • Touch or touchless fulfillment • Direct connections • Corporation booking system, TMC 3rd party system, ITMC

  49. Role of Technology – SBT Differentiators • UI (User Interface) • Administrative Module / Configurability • Global Capabilities • Languages • Currencies • Sources – GDS/GNE/Super PNR/Web Fares/Trains

  50. Role of Technology – SBT Differentiators • Operations Assistance • Provisional itineraries • Void / Cancel / Refund / Exchange • Seat selection • Profile Integration • Integration with other related software • Pricing structure / Level

More Related