Managing Travel Programs Has Changed

What comes to mind when you reflect on the past 2 years? Well, that didn’t go as planned… Here’s hoping we can loosen our seat belts a bit and see the descent just ahead😊

As crisis’ in the past have demonstrated, change and evolution are inevitable. Some of these may have more sticking power, while others could fade out such as stringent pre-approvals. I believe our industry will evolve with a greater sense of community and awareness of the importance of corporate travel to each other and our economy. We are a resilient people!

Regardless of how we traveled before, that too will be different and perhaps more scrutinized for ROI deliverables. For example, the access to and acceptance of video meetings will have lasting impacts on how we approach face to face meetings in the future.

I see so many thought leaders and colleagues coming up with new and innovative ways to look and measure the impact of travel both in and outside of their organization

While RFP’s have long been in play, and improvements have certainly been made, more focus is being placed on the purpose of the RFP. Approaching the process like a ninja with laser focused intent on what suppliers to include and defining what suppliers bring the most value. There is no room for those that haven’t used the past 2 years wisely to develop new offerings and bring more value to organizations.

This brings me to a topic I think has never had greater relevance then it does today.

Connecting The Dots With Data

Long before you can begin to launch an RFP, there is a step where we consistently found ourselves challenged. It’s data, specifically missing data, and gaps in your data sets. For example, what if the traveler upgraded the room or extended their stay? Another example is the ability to link bookings to your corporate hierarchy to ensure correct allocation of travel budgets, without aggregation you are missing this valuable piece. Hotels can have 7 or 8 naming conventions, without normalizing you are missing opportunities for negotiation. Without a way to link meals costs, ancillary air and hotel charges to the PNR you are viewing pieces of the trip, not the true cost of the trip. I could continue to list the gaps, but then you might start to fade out and I’d you to consider the rest of my thoughts here so I will continue on….

It’s very evident, we can no longer afford to have gaps to effectively manage travel programs.

Be A Data Champion

Without a data strategy, it’s a long and laborious task to gather, consolidate, and correlate your travel and expense data. I would argue, without a travel data expert its nearly impossible.

No travel team wants to enter any sourcing exercise without having an excellent data set. But why do we often see segregated travel & expense data being used? Because without a data strategy, each transaction lives in a silo without ever being integrated to the other data elements of the transaction. Not to mention normalizing and validating data. You can see how this create an inaccurate view of reality?

But where do you start? You start with the data and a solid data strategy. Like balancing your checkbook, you can’t leave out transactions and expect it to balance.

Data is critical to successfully managing a travel and expense program and sourcing the right partners. How to do so:

  1. Define desired outcomes that align with business goals.
  2. Establish your audience and identify the needs of each stakeholder.
  3. Identify the source of each transaction within your travel & expense data.
  4. Discuss how you will use your data to streamline processes, monitor travel trends and capture savings. Include ROI’s in your data strategy, for example define a % of hotel savings that can be directly attributed to visibility into patterns and out of channel bookings.

Let’s look at a very specific example: A company with $3M in hotel spend that is preparing to negotiate a new discount rate. On average, hotel leakage (out of channel bookings) is 57% and the average discount rates on a negotiated hotel rate is 5-12%.

  • Company A: Has 57% leakage, negotiates based on the $1.3M reported spend from their TMC and secures a 6% discount rate. Captures the 6% discount on the $1.3M in-channel spend and saves $77.4K per year.

  • Company B: Has 57% leakage, negotiates based on the $3M total spend from their consolidated and normalized data set and secures an 10% discount on the $3M total spend and saves $129K per year on the $1.3M in-channel bookings.

  • Company C: Uses consolidated and normalized data to identify and reduce out-of-channel bookings by half. Uses this data set to negotiate a 12% discount on the $3M total spend and saves $257K per year on the $2M in-channel bookings.

Picture2

By consolidating, normalizing and acting on the data a company can realize a 3.3x increase in savings. The same approach can be extended to airline and ground negotiations. The monetary value of an aggregated data set is apparent.

  1. Partner with an expert who can assist and remove the complexity of consolidating your data sets.
  2. Be patient. This is a process and in the long run taking the time to create a data strategy will ensure future decisions are data driven vs perceived state.

Challenges create opportunities for all of us to do and think differently. Don’t get stuck in the mindset, this is how we have always done it. Be better, smarter, and wiser. Set your program up for success by equipping yourself with all your data and partner with an expert like Grasp who have been creating data champions for 26 years.

 

You may also like

How to Succeed While Working From Home
How to Succeed While Working From Home
25 March, 2020

With the global pandemic of COVID-19, lock downs and mandatory self-quarantines becoming more necessary, companies are t...

Travel Accounting
Travel Accounting
3 February, 2022

Most businesses believe that they operate differently than their competitors. Perhaps they think that they have found a ...

[Case Study] Looking Beyond Plastic for Business Travel Expense
[Case Study] Looking Beyond Plastic for Business Travel Expense
4 May, 2022

To put it simply, a virtual credit card is a card that isn’t tangible and is completely digital. It has a Card Security ...