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Travel Management Globalization May Lead to Program Cost Savings According to New Research

2011-04-12

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American Express Corporate Travel Pros Say Cost Savings is Driver / Navigating Cultural Nuances Important to Success

American Express Global Business Travel today announced new findings “With the new global survey series with ACTE, we are The Globalization research was conducted by the eXpert insights “As companies look to expand both their global sales footprints and Globalization in Practice

Based on the study interviews, the characteristics of a global managed

Global Governance: A management team is in place made up of

Single Travel Policy: Managing one policy
Data transparency: Collecting, analyzing, and

Cost-Savings Potential with Globalization< Reducing costs is a clear priority for firms in general, and with travel

Consolidation: Rationalizing suppliers, consolidating agency

Data Collection: Companies looking to continue to maximize

Demand Management: Through centralized data capture, a company Navigating Cultural Travel Nuances

“Candid comments from survey participants showed that local business There is also much to learn from travel management practitioners in The year-long study is exploring areas of managed travel where regional "Our industry is now comprised of five generations of travelers and Results from the first stage North American survey reviewed at ACTE this

57% have a more lenient “suggested” compliance approach to their

76% believe employees’ sense of entitlement is the driving force

46% see lack of information around policy benefits is the biggest

69% are supplementing face-to-face prospect and client meetings with

81% use an online booking tool; 79% use an expense reimbursement Additional Recommendations and Best Practices

Assess readiness and culture; have other areas of corporate spending

Identify an executive sponsor to be a long term champion of the

Create a minimum global policy and establish a process for local

Drive online adoption to optimize booking and reduce potential service

Integrate local stakeholders and do not bias toward a single Globalization Report and ACTE Survey Methodology
American Express Business Travel's eXpert insights research practice For the cultural nuances study, American Express Business Travel is About American Express Global Business Travel
American Express Global Business Travel, a division of American Express

Logos, product and company names mentioned are the from “Globalization: Is Your Travel Program Ready?” a study on driving managed travel program globalization, identifying the characteristics of global programs as well as trends and best practices for implementation success today. Following this research, American Express has initiated a year-long research series with the Association of Corporate Travel Executives (ACTE) to explore travel management practices in North America, Asia-Pacific, and Europe to identify the cultural nuances that may impact travel program globalization achievement.

looking to reveal the cultural nuances in North America, Europe, and Asia-Pacific that may be impacting global travel programs and traveler decision-making behavior.”
research practice of American Express Global Business Travel’s Advisory Services in partnership with the Business Travel Media Group (BTMG), which interviewed senior corporate travel management professionals of recently globalized programs. The travel professionals revealed the leading driver to globalize was to achieve cost savings, with many indicating 20% savings was their organization’s target and projecting savings could surpass that mark. Traveler safety and security was also identified as a prominent objective when respondents were asked about other benefits to globalization. Finally, interviewees acknowledged the need to have a solid change management strategy and executive buy-in in place to address local market sensitivities likely rooted in regional cultural differences.
functional efficiencies to drive scale and grow their businesses, more and more will look to globalizing travel program management,” said Christa Degnan Manning, director, eXpert insights research, American Express Global Business Travel. “Yet globalizing travel can be one of the more complex categories of spend to centralize. Through our experience we’ve found companies need to assess their readiness, secure executive sponsorship, align key stakeholders in each region, and devise a long-term change management program outlining the benefits for both the enterprise and the traveler moving forward.”
travel program are:
cross-functional and regional roles to guide global corporate travel implementation and activities. Focus is on consensus building however an effective governing structure has authority and executive support to enforce travel policies, define exceptions as appropriate, booking processes, and supplier choices. in all countries is a primary characteristic of a global program. Of the participating companies interviewed, the minimum number of countries managed was in the 16 to 25 range while the largest managed 51 to 75 countries under a single policy. Defining a minimum policy to apply globally and allow for local markets to apply modifications was cited as a best practice, particularly as local market regulations and law can impact travel policy. consolidating global data is a key attribute of a global program by providing visibility into travel spend across all regions and markets. This is a critical dependency for companies to achieve cost saving objectives, particularly by leveraging the data during supplier negotiations. p> globalization often being initiated out of procurement or finance departments, it is no surprise that companies choosing this path are motivated by cost savings. The study identified the areas where cost savings can best be realized.
and service support, and allocating internal resources more efficiently can drive savings through globalization. Harnessing increased global travel volume for leverage with suppliers is the most prevalent cost savings tactic. For the companies studied, it was not unusual for the globalization team to uncover contracts with 40 or more agencies, so consolidating this area alone could lead to savings in the form of lower aggregate fees, more consistent service, and better data capture overall. savings over time should continue to look at improved data collection as a strategy. Having the information to make the most informed decisions during negotiations and choosing suppliers based upon the company’s personal market data is critical to sustained cost savings as the travel supply market changes itself over time. can identify new savings opportunities and additional areas to control costs through demand management. Techniques for demand management can vary based on supply market demands, but generally can include advance purchase practices, preferred supplier selection, and policy, compliance and general traveler behavior management overall. Increasingly, demand management involves supporting employees’ decisions around virtual meeting technology. practices and relationships can stand in the way of effective globalization today,” continued Christa Degnan Manning. “With the new global survey series with ACTE, we are looking to reveal the cultural nuances in North America, Europe, and Asia-Pacific that may be impacting global travel programs and traveler decision-making behavior.
terms of what has been successful to date in mitigating these barriers to success – and this will be gleaned from the in-field interviews and discussions we will conduct at all of the global ACTE events worldwide this year.”
cultures may influence travel behavior and potentially impact globalization, including: compliance environment, employee travel behavior, governance, and travel and meeting technology alternatives.
travel professionals," said ACTE Executive Director Ron DiLeo. "To advance travel management to the next level, we need to understand both geographical and generational nuances in a way that is relevant locally, regionally and globally. This study gives our industry the new material needed to leverage that knowledge in a way that appeals to behaviors embraced by each and all of these generations.”
week showed that North American-based travel professionals revealed:
programs, with only 44% having a mandated approach. behind non-compliant behavior barrier to changing traveler behavior, with 43% indicating insufficient program governance is a barrier online technologies like web conference; 41% said internal meetings are increasingly being conducted through telepresence solution and 51% use a pre-trip approval/reporting tool for Globalization:
been consolidated strategy and governance markets alterations fragmentation market collaborated with Business Travel Media Group (BTMG) Content Solutions to produce the Globalization report. To gather the research, BTMG conducted in-depth interviews with implementation experts as well as corporate travel management professionals from eight corporations recently involved in globalizing their programs. Representing diverse industries, companies participating in the study ranged in size from 10,000 to more than 300,000 employees with travel populations ranging from 4,000 to 100,000 individuals. Total annual travel spending varied, but half of study participants claimed more than $200 million USD in business travel expenditures annually. Three out of eight proved that travel program globalization presents a significant opportunity for midsize travel programs with annual spend in the $10 million to $50 million range.
partnering with the Association of Corporate Travel Executives (ACTE) to survey travel program management behaviors in North America, Europe and Asia-Pacific. Through a series of primary surveys, telephone interviews, and in-person discussions at ACTE global events throughout the year, the study seeks to be the first of its kind incorporating quantitative benchmarking data on regional program characteristics and qualitative details on cultural implications effecting travel program management success today. The survey results debuted this week are based on 164 initial survey responses from corporate travel management professionals based in North America.
Company, is a global industry leader in business travel and meetings management committed to helping businesses succeed through cost-effective program management, world-class customer service, and enhanced traveler productivity and support worldwide. Through leading online, offline and on-the-go solutions, consulting services, business insights and research, supplier negotiation expertise, and meetings and events capabilities, innovative services are delivered to clients to maximize their return on investment. Learn more at www.americanexpress.com/businesstravel.
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