NBTA 2008 presents an opportunity for travel procurement to make a difference
Travel buyers look at strategic meetings management at annual conference
By Susan Avery -- Purchasing, 9/11/2008 2:00:00 AM
Rising costs of corporate travel services and economic uncertainty enticed more travel buyers than ever before to the 40th Annual National Business Travel Association (NBTA) International Convention & Exposition in Los Angeles recently. In fact, more than 6,400 travel buyers and suppliers attended the event.
"There has never been a better time for travel buyers to make a difference at their companies," said Robert Greyber, senior vice president at Egencia Corporate Travel North America in Bellevue, Wash. At an educational session at the convention, he summed up the mood of the event and suggested buyers "take advantage of the opportunity for innovation."
Educational sessions covered such diverse topics as supplier relationship management (SRM), strategic meetings management, procure-to-pay best practices and social networking.
The expo consisted of more than 400 supplier companies—travel management companies, airlines, hotels, car rental companies, technology providers and others. Suppliers were on hand to consult with buyers and introduce new products and services.
Since many companies hesitate to reduce their travel spending—they believe it is necessary to successful corporate strategy in an increasingly competitive world—a hot topic at the event was compliance—how to sell travel programs to travelers so they buy services through preferred suppliers. Purchasing through contracts with preferred suppliers is one way to help control costs with negotiated rates and volume discounts.
Another way is by better managing demand—educating travelers to make smart, more cost-effective decisions about the travel they do. These decisions may consist of taking a day rather than an overnight trip, staying in a mid-tier hotel or driving to a destination.
SRM.
Setting the stage for an educational session on innovating supplier relationships, Corey Hance, client consulting services manager at Egencia, said the topic is "particularly relevant" for travel buyers in attendance given the softening economy, airlines slashing routes and adding fees and fluctuating hotel room rates.
"Everyone is looking to get the most for their dollar," he said. "Travel buyers are looking up and down the supply chain to determine which suppliers to work with as partners."
Sanjit Menezes, vice president at consulting firm Anklesaria Group in Del Mar, Calif., agreed that travel buyers are under tremendous pressure to reduce costs. "But, it is not about negotiating rates, it is about generating value through breakthrough process improvements," Menezes said.
He added: "Suppliers may be doing things that are causing you to spend more money, and you may be doing things that are causing your suppliers to spend more money."
Also presenting at the session was Doris Middleton, travel manager at Energizer in St. Louis. She recently renewed an agreement her company has with its travel management company (TMC). Working with the TMC, she helped raise customer satisfaction levels among travelers to 80% from about 50% in two years by setting clear expectations for service early on and broadly communicating them "so that everyone is on the same page." Typically when satisfaction levels are high, travelers are more likely to work with the TMC, a preferred supplier, to book travel, helping to keep costs in check.
The service level agreement includes penalties rather than rewards to encourage supplier performance. "We expect suppliers to meet expectations," Middleton told attendees.
And to improve efficiency and reduce costs, Energizer instituted fees for travelers booking trips directly with the TMC ($50) and using the company's automated booking tool ($10). Again, as a way to manage costs, travelers will more likely choose the lower cost option unless they're putting together a complex itinerary.
Meetings.
Travel buyers and suppliers attending the NBTA event also were talking about strategic meetings management programs and ways to improve efficiencies and reduce costs of this buy, which for some companies can equal spending on airline travel.
At an educational session on strategic meetings management, Pamela McTeer, senior supply manager at MillerCoors in Chicago, said that the meetings buy is the responsibility of the strategic sourcing function at her company because it needs visibility into the spend and to better mitigate risk associated with it. MillerCoors spends approximately $40 million on about 500 meetings annually. It outsources much of the buy to two meeting planning companies.
In the exhibit hall, travel buyers found a variety of new offerings and tools to help streamline the travel procurement process. At the Travelocity Business booth, the company boasted its clients have set a new standard with 85% of bookings made via the GetThere online booking tool, up from 80% at the close of 2007. It also announced a new portal for travel arrangers. In related news, parent company Sabre Holdings recently acquired BidStork, a tool for use in negotiations with hoteliers.
Orbitz for Business unveiled a ranking of the top business travel markets in which costs (average domestic airfare and average daily rates for hotels) have demonstrated price fluctuations. For example, the U.S. market that has seen the greatest percentage increase dollar-wise in average transaction is Columbus, Ohio. Salt Lake City tops the list of U.S. cities on a percentage basis that have seen an average air transaction decrease in 2008. The company also announced an agreement with ExpenseWire, a Rearden Commerce company, to provide its expense management tool to Orbitz for Business customers.
Hogg Robinson Group rolled out an enhanced version of its HRG i-Suite. The web-based portal offers ability to integrate a new self-service reservation tool, data consolidation and reporting and traveler tracking capabilities.
Egencia, an Expedia company, debuted its On the Go tool and the integration of content such as hotel reviews, city guides and SeatGuru by TripAdvisor online that helps customers make informed decisions when planning travel. In the U.S., the On the Go tool delivers updated itinerary information via text, e-mail and voicemail to business travelers. In Europe, travelers who are more likely to have Internet-enabled phones or PDAs (personal digital assistant) are able to access data such as itineraries, flight schedules and local weather conditions from a mobile device.
TripIt announced a partnership with Sabre VirtuallyThere. TripIt provides a travel itinerary and social networking service for business travelers. By forwarding their flight, hotel and rental car confirmation e-mails to TripIt, travelers receive a combined master itinerary with all their plans in one place. The company is expanding the tool to include meetings, events, restaurants, car services, trains and cruises. The service also provides daily weather, local maps, driving directions and city guides.
StarCite introduced two new products for small and mid-sized businesses that allow these companies to bring control, consolidation and oversight to their meeting planning process. This, the company says, helps reduce costs and maximize investment in meetings and events. It also took the opportunity to unveil its new StarCite Group Rate Advisor report, which provides meeting planners and suppliers with hotel rate forecasts using meeting planning data from RFPs (request for proposal) flowing through its meetings platform.
Worktopia used the expo to launch its Universal Meeting Solution. UMS automates the process for meeting planners to search, compare and book space for simple meetings, arrange catering, audio-video equipment, overnight accommodations and other amenities. The tool provides attendee management capabilities, meeting activity reports and user enrollment tools.
BMO Spend & Payment Solutions, part of BMO Financial Group, is combining its Spend Solutions suite with on-demand offerings available through Ariba. With the Spend Solutions suite, companies can manage spending from sourcing suppliers and contract management to procurement and invoice presentment and payment.
At the Visa booth, the company shined the spotlight on its updated and expanded commercial payment card best practices study. Results show procure-to-pay automation helps companies improve efficiencies and reduce costs.
NBTA holds its 2009 International Convention and Expo August 23-26 in San Diego. For information, go to www.nbta.org.
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