ACTEWHITEPAPER1

8/2/2019 ACTEWHITEPAPER1

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1 |From numbers to action2010byAdvito.Allrightsreserved

From numbers to action

White Paper

Improving travel program management

through strategic KPIs and meaningful

savings measurements


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ContentsExecutive Summary 3

Introduction: The data challenge for travel managers 8

Section 1: Strategic KPIs 10

Section 2: Meaningful savings measurement 23

Section 3: Sourcing, combining and managing data 29

Final word: The role of benchmarking in strategic performance management 32

Contents

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Thiswhitepaperarguesthattravelmanagerscanimprovetheperformanceoftheirtravelprogramsbycreatingstrategickeyperformanceindicators(KPIs)whichmeasurehowsuccessfullytheyaremeetingcorporateobjectives,providesasamplesetofstrategicKPIsandsetsforthclearguidelinesforbuildingastrategicKPIprogram.

1.StrategicKPIs Strategic KPIsmeasurehowwellacorporateprogram,suchasthetravelprogram,ismeetingcorestrategicgoals,forexamplecostcontainment,sustainability,processefciencyorrevenuegeneration.

Strategic travel KPIsTheoptimumnumberofstrategicKPIsforacorporatetravelprogramiseightto12,balancingcomprehensivenesswithavoidanceofover-complexity.AnexampleofabalancedselectionofKPIsappearsonpage4.

Executive summary

Travel managers know good data is crucial or their work. Butwhich data do they need? Are they combining the appropriate

measurements or true perormance management, building a ulland actionable picture o what is going on in their travel program?And do they have the inormation which tells them whether thetravel program is being managed in line with their organizationsoverriding strategic objectives?


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BacktoIndex>Executive summary

KPI Relevance Denition

Travelmanagementservicescoverage HowmuchofthetotalT&Espendisinuencedbytravelmanagement?

Virtualmeetingindex Whatistheshareofmeetingsusingvirtualmeetingtechnology(i.e.,videoconferencing)incomparisontoallinternalmeetings?

Valueofmanagedtravel Howmuchhavewesavedbysourcingandsteeringeffectively?

Travelexpenseproductivity Howdoesthechangeinourtravelspendcomparetothechangeinbusinessrevenueovertime?

Travelintensity Howmuchareouremployeestravelingtoconductbusiness?

Policycompliance Howwelldotravelersadheretokeypolicycomponents? Compliancelevelspercategory(i.e.,air,hotel,etc)weightedbycategoryspendasshareoftotal

Changeintotaltravelcost Howmuchistravelmanagementcontributingtoabottom-lineimpactinoperatingexpenses?

Climateimpactofbusinesstraveltransport

reduction

Howenvironmentallysustainableareourbusinesstravelactivities?

Shareofcorporatecreditcardvolume Howmuchofthetotaltravelandrelatedspendcanbetracked?

Travelagencyperformanceindex Howwelldoesthetravelagencyperformintermsofcost,servicedeliveryandstrategicsupport?

NumberofinternaltripsNumberofvirtualmeetings Numberofvirtualmeetings

+((

Salesturnover+neworders

totalT&Espend

2((


Sumofdistancetraveled

2((

currentnumberoftrips

Averagetotalcostpertripinpreviousperiod

Averagetotalcostpertripincurrentperiod((

( (Currentclimateimpact(air+rail+rentalcar)

previousclimateimpact(air+rail+rentalcar)


Managedtravelspend

TotalT&Espend

3

((Agencycostproductivityindex +Grosstransactionvolume

+Travelersatisfactionindex+SupplierevaluationindexGrosstransactionvolume

Managedtravelspend

TotalT&Espend

SavingsagainstmarketindexSum percategory

Cashdiscount+(

(

StrategictravelprogramKPIs


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Value of strategic KPIs Educationallowtravelmanagersandotherrelevantmanagerstogaina

deeperunderstandingofthepurposeofthetravelprogram Decisive interventionmanagerscanintervenequicklywithremediesif

targetrangesarenotbeingmet Communicationeffectivetoolsforconvincingdepartmentsorbudget-

holderstochangetheirbehavior Career progressionprovideashowcasefortheissuestravelmanagers

workonandprovetheyarecapableofhigh-levelstrategicthinking

Tips on building a strategic KPI programStep 1TakeitseriouslyItisastraightforwardtaskforcompanieswithmaturetravelprogramsbutitdoestaketimeandmanpower.

Step 2MapoutyourcorporatestrategicgoalsSimpliedexamplesinclude:costcontainment,sustainability,dutyofcareandgovernance/compliance,employeeproductivityandemployeesatisfaction.

Step 3MapyourtravelgoalstoyourcorporatestrategicgoalsE.g.,costcontainmentreducedtravelpurchasingcosts,reducedtravelprocessingcosts,reducedtripvolumes(travelprogramgoals:savings/costavoidance,demandmanagement,negotiation/sourcing)

Step 4DenetheappropriateKPIstomeasureyourprogressThencreateamatrixtogradetherelevanceofeachKPItoeachtravelgoal.

Step 5IndentifymasterdatasourcesForeachKPI,mapsuggesteddatasources,frequencyofreporting,whohasresponsibilityandtheprocessowner.

Step 6ActonthedataInvestigateandtakeactiononresultswhichfalloutsideanticipatedKPIranges.

2.MeaningfulsavingsmeasurementSincecost-containmentisacriticalcorporategoalformostbusinesses,someoftheirstrategictravelKPIswillalsobesavings-related.However,unlesssavingsaregivenareal-worldcomparativecontext,theycanprove

meaninglessandpossiblymisleading.

The procurement perspectiveChange in pricecostsavingbasedonpricecomparisonwithpreviousyearChange in price compared to change in market indexcostsaving/avoidancebasedonpricecomparisonwithindex,e.g.,volumevariance(changeinnumberofbookingsmade)andmarketindex(benchmarkagainstaveragepriceachievedbyothercompanies)

Sourcing performance metricscostsaving/avoidanceachievedbychangingrequirements,usinge-auctions,etc.

Beyond procurement

Travelprogramsavingsmeasurementsgobeyondthetraditionalprocurementcontextabove.Keysavings/costavoidancemeasurementsinclude:

Behavioral savingsequippingtravelerswithtoolsandmotivationtodotherightthingDemand managemente.g,usingvideo-conferencingandothertravelalternatives

Executive summary


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StrategicKPIasfeaturedinthiswhitepaper

Other/TacticalKPI

Whats your savings hierarchy?ManyofthestrategicKPIsdiscussedinthispaperaredirectlyorindirectlyrelevanttoachievingsavings.Theyincludeeverythingfromonlineadoptionratetousageofvirtualmeetingstopolicycompliance.Totiethemtogether,itisusefultomapthemoutasahierarchy.

Executive summary

KPIhierarchy:Savings

ValueofManagedTravelNetCostofServiceRatioChangeinTotal

TravelCost

ChangeinAverageCostperTrip TravelIntensity

VirtualMeetingIndex

TravelManagementServicesCoverage

Savings/CostAvoidance

SavingsagainstMarketIndex

PolicyComplianceAdvanceBooking

Ratio

EconomyClassRatio

ChangeinNegotiatedPrice

CashDiscountsOnlineAdoptionRate

Process Efficiency Sourcing Behavior ManagementDemand

Management


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3.Sourcing,combiningandmanagingdataSourcing dataAsurveyofAssociationofCorporateTravelExecutivesbuyermemberscarriedoutforthiswhitepaperonbehalfofAdvitofoundthemostpopularsourcesfordataarecorporatecardprovider(86percent),travelmanagementcompany(82percent),travelexpensemanagementsystem(59percent)andaccountspayable(50percent).

Noneofthesesourcesisperfectinisolation;bestpracticeistocombineseveraldatasourcesforthefullestpossiblepicture.

Combining dataTravelmanagersoftencombinedatasourcesthroughadatawarehouse.Thethreebasicoptionsforcreatingadatawarehouseare:In-housecanbeslowandcostlybutguaranteedtobecompliantwith

internalprocessesOutsourcedbuiltbysubjectmatterexpertswhoarefasttoimplementandwellawareofthebarrierstoaccurate,consolidateddataHybridthirdpartybuildsandhoststhedatawarehousebutitiscontrolledin-house;workswellifdatateamhasatravelanalyst

Eachoptionhasitsadvantagesanddrawbacksthebestchoicedependsonanindividualcompanysrequirementsandconstraints.

Analyzing dataManycompaniesconcludetheyneedspecializedconsultantswithpowerfulanalyticaltoolstoperformorassistwiththistask.

4.BenchmarkingAdvitobelievescompanieswouldbenetgreatlyfrommeasuringandthenbenchmarkinganagreedstandardsetofstrategicKPIs,suchasthoseoutlinedinthiswhitepaper.

Executive summary

Best practice is to combine several data

sources or the ullest possible picture


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BacktoIndex>Introduction | The data challenge for travel managers

From measurement to managementThere is a well-known business dictum that what gets measured,

gets managed. Given the complexity o modern commerce,leadership based largely on gut eel has no chance o success.

However,therearealsodangersinherentinthisprinciple.Ifcompaniesmakethewrongchoicesaboutwhattomeasure,theywillformamisleadingpictureoftheirperformance.Andthereisalsotheriskofcomplacency:themanagementprocessstarts,ratherthannishes,withmeasurement.Datadoesnotbecomeusefulunlessitisactedupontomakepracticalimprovements.

Performance management for corporate travelTravelmanagersknowgooddataiscrucialfortheirwork.Butwhichdata

dotheyneed?Aretheycombiningtheappropriatemeasurementsfortrueperformancemanagement,buildingafullandactionablepictureofwhatisgoingonintheirtravelprogram?Anddotheyhavetheinformationwhichtellsthemwhetherthetravelprogramisbeingmanagedinlinewiththeirorganizationsoverridingstrategicobjectives?

Inmanycasestheanswerisno.Agoodexampleexaminedinthiswhitepaperisthemeasurementofsavings.Corporationsoftenbringthewrongdatasetstogethertomakecomparisonswhichlackimportantcontext.Asaresult,travelmanagersgainnomeaningfulunderstandingofwhetherthesavingstheyhaveachievedmatchorunder-performtheirtruecost-reductionpotentialandbenetforthecorporation.

The crucial role of strategic KPIsWhilemosttravelmanagersusemetricstomanagetheirvariousprogramcomponentsandinitiatives,theirmeasurementsareoftentacticalinnatureandsometimesmisleadingasindicatorsofprogrameffectiveness.Frequentlyusedmetricstendtomonitorisolatedsilosofdatasuchasmissedsavingsopportunities,theaveragetimeneededforatravelmanagementcompanytoanswerthephoneoraveragedailyhotelrateinthetoptencities.Corporationsfrequentlyfailtoanalyzetheirtraveldataholistically,ortomaketheessentialconnectionthatisthekeytoperformance

management:linkingwhattheymeasuretooverallcorporateobjectives.

Advitobelievesbusinessesshouldcreateasmallset(aroundeightto12)ofstrategickeyperformanceindicators(KPIs)whichgaugetheoverallhealthandeffectivenessofatravelprogram.ThesestrategicKPIswillallowthetravelmanagertoworksmartlyandquicklywithseniormanagementtomakeappropriatedecisionstomeetcorporateneeds.Ratherthanexpectingstakeholderswithouttravelbackground(usuallyamajorityinanygivencorporation)tolearntravelmanagementjargonandidiosyncrasies,itisuptotravelmanagementtotranslatethevalueofamanagedprogramintothelanguageofthecorporation.ThisiswhatstrategicKPIsdo.


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Start collecting your strategic KPIs hereNotmanycompanieshavestrategicKPIsinplacetoday.However,thatcould,andarguablyshould,change.Gettingthisprojectunderwaydoesnothavetoentailaninordinateamountofwork,especiallyforcompanieswithhighlevelsoftravelprogramcompliance.ThiswhitepaperisintendedtoactasastartingpointfortravelperformancemanagementthroughestablishingstrategicKPIsandimprovingtechniquesformeasuringsavingswhichisitselfastrategicKPI,giventhatsavings/cost-containmentisakeygoalfornearlyallbusinesses.

WealsobelievestrategicKPIsareanareawheretravelmanagerscanbenetenormouslybybenchmarkingwitheachother.Wethereforehopethiswhitepaperwillprovidethelaunchpadforanindustry-wideefforttoestablishasetofKPIsthatbusinessescanusenotonlytotracktheirperformanceinternallybuttounderstandwheretheysitincomparisonwiththeirpeers.

Introduction | The data challenge for travel managers

KPIs and SLAs

Whatsthedifference?ItcanbeeasytoblurtheboundariesbetweenKPIsandServiceLevelAgreements(SLAs)perhapsbecauseSLAsaremorefamiliarterritoryformanagedtravelprograms.Butitisimportanttounderstandthedifference,particularlywhenitcomestothestrategicKPIsunderdiscussioninthiswhitepaper.

AnSLAisaformalnegotiatedagreementbetweenaclientandaserviceproviderwhichdenesparametersandresponsibilitiesforthedeliveryofaservice.AdherencetotheSLAisjudgedaccordingtomeasurementsthatquantifytheperformanceofthesupplieragainstthoseparameters.Thesemeasurementsarespecic,operationaland/ortactical.Theymay

beconsideredKPIsfortheparticularagreementinquestion,buttheyarenotstrategicKPIsfortheoveralltravelprogramanditslinktostrategicobjectives.

However,suppliersadmittedlyhaveanimportantroletoplayinhelpingcompaniesachieveprogramand,inturn,corporateobjectivesOnceyouestablishyourstrategictravelprogramKPIs,youshouldreviewrelevantSLAstobesurethattheysupportthoseKPIs.

KPIs are an area where travel

managers can beneft enormously by

benchmarking with each other


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BacktoIndex>Section 1 | Strategic KPIs

What is a strategic KPI?Key perormance indicators measure operational and

management perormance against a stated set o objectives.These objectives should be SMART: Specifc, Measurable,Achievable, Realistic and Time-limited. Although all KPIs are, bydefnition, important, strategic KPIs are the most undamentalo all. They measure how well a program, such as the travelprogram, is perorming in meeting core strategic corporate goals,such as revenue generation, cost containment, governance orsustainability. Simply put, they are the critical ew metrics that linkthe travel program goals to corporate objectives.

What is wrong with tactical KPIs?Nothing.TacticalKPIsareanyquantiablemeasurementsthatcanbetrackedandevaluated,sotheyareveryimportant.However,theyareinadequatetotellthewholestory.Totakeasimpleexample,ausefultacticalKPIistoknowhowmuchcashdiscountisbeingpaidbysuppliers.However,ifanairlineispayingalargediscountbasedonthemostexpensivefarebuckets,thenthepricereductionislessimpressive.ThetacticalrebateKPIthereforeneedstocontributetoamorecomplexstrategicsavingsKPItoenablefullerunderstandingandaction.

How many strategic KPIs?

Webelieveeightto12istheoptimumrange.Asmallernumbermayfailtoprovideabroadenoughperspectiveofthetravelprogram.Alargernumberrisksleavingmanagersadriftinaseaofdata,unsurewhereandwhattoprioritize.

The value of strategic KPIs EducationTheprocessofcreatingstrategicKPIsallows

travelmanagersandotherrelevantmanagerstogainadeeperunderstandingofthepurposeofthetravelprogram.Itensurestheyarealigningtheprogramwithcorporategoals,reviewstheprogramsdatasourcesandstartsadialoguewithotherinternaldepartments(suchasnanceorsustainability).

Decisive interventionBycreatingtargetrangesforeachstrategicKPI,managerscanidentifyataglancewhetherastrategicgoalisbeingmetandintervenequicklywithremediesifitisnot.Interventionisnotthesoleprovinceofthetravelmanager;actionsmayneedtobeownedorimplementedbyotherstakeholders.

Communication StrategicKPIsareveryeffectivetoolsforconvincingdepartmentsorbudget-holderstochangetheirbehavior,especiallyiftheyareshowntobeunder-performingagainstotherunits.

Career progressionStrategicKPIsmaketravelmanagerslookgood.Notonlydotheyprovideashowcaseforthewiderangeofissuestravelmanagersworkon,usingstrategicKPIsalsoprovestheyarecapableofhigh-levelstrategicthinkingtodriveforwardcompanyobjectives.


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ScorecardsReaderstrainedinbusinessmanagementwillbeawareofastronglinkbetweenstrategicKPIsandtheconceptofscorecards.Scorecardsidentifyasmallnumberofnancialandnon-nancialmeasurementsandattachtargetstothemtoanalyzewhethercurrentperformanceismeetingexpectations.Inconsequence,managersareabletofocusattentiononthoseareaswheretargetsarenotbeinghit.

Aswillbeseenlater,thestrategicKPIsproposedbyAdvitowouldtneatlyintoascorecard,withsomeoftheKPIsmeasuringnancialobjectives,butothersmeasuringasmallrangeofnon-nancialobjectives,suchasgovernanceandsustainability.

Examples of strategic KPIsAdvitohasidentiedasamplesetofgenericstrategictravelprogram

KPIsthatwebelievewouldbeusefulformanyorganizationstoconsiderastheysupportvariouscorporategoals(seeFigure1).

Case study

WhyEADShascreatedstrategictravelKPIsEADSownsthecommercialaircraftmanufacturerAirbusandalsomakesmilitarytransportandghteraircraft,defenseelectronicsandsecuritysystemsandspacesystems.

We rely on tactical KPIs as baseline measurements of performance,but more and more we are combining them to produce strategic KPIswhich measure the management of our business. They help us toidentify issues such as why our spend has risen or if we are missingopportunities to improve our savings.

Strategic KPIs are not a collection of numbers. They are a value-adding

set of tools which enable us to take decisions. Its what lies behind thestatistics in trending and more qualitative analysis of statistics thathelps us identify areas of concern and what we have to deal with.Without strategic KPIs, we cannot be relevant to stakeholders and takerelevant actions.

James WestgarthHead of Extended Travel Enterprise, EADS

Section 1 | Strategic KPIs

Scorecards identiy a small number

o fnancial and non-fnancial

measurements and attach targets

to them to analyze whether current

perormance is meeting expectations


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Figure 1StrategictravelprogramKPIs


KPI Relevance Denition

Travelmanagementservicescoverage HowmuchofthetotalT&Espendisinuencedbytravelmanagement?

Virtualmeetingindex Whatistheshareofmeetingsusingvirtualmeetingtechnology(i.e.,videoconferencing)incomparisontoallinternalmeetings?

Valueofmanagedtravel Howmuchhavewesavedbysourcingandsteeringeffectively?

Travelexpenseproductivity Howdoesthechangeinourtravelspendcomparetothechangeinbusinessrevenueovertime?

Travelintensity Howmuchareouremployeestravelingtoconductbusiness?

Policycompliance Howwelldotravelersadheretokeypolicycomponents? Compliancelevelspercategory(i.e.,air,hotel,etc)weightedbycategoryspendasshareoftotal

Changeintotaltravelcost Howmuchistravelmanagementcontributingtoabottom-lineimpactinoperatingexpenses?

Climateimpactofbusinesstraveltransport

reduction

Howenvironmentallysustainableareourbusinesstravelactivities?

Shareofcorporatecreditcardvolume Howmuchofthetotaltravelandrelatedspendcanbetracked?

Travelagencyperformanceindex Howwelldoesthetravelagencyperformintermsofcost,servicedeliveryandstrategicsupport?

NumberofinternaltripsNumberofvirtualmeetings Numberofvirtualmeetings

+((


totalT&Espend

2((


Sumofdistancetraveled

2((

currentnumberoftrips

Averagetotalcostpertripinpreviousperiod

Averagetotalcostpertripincurrentperiod((

((Currentclimateimpact(air+rail+rentalcar)



Managedtravelspend

TotalT&Espend

3

((Agencycostproductivityindex +Grosstransactionvolume

+Travelersatisfactionindex+SupplierevaluationindexGrosstransactionvolume

Managedtravelspend

TotalT&Espend

SavingsagainstmarketindexSum percategory

Cashdiscount+(

(


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A broad rangeThisselectionofKPIsaddressesabroadrangeofcorporategoals,bothnancialandnon-nancial.Therearealsomajorvariationsbetween

themintheircomplexity,intermsof: Howmuchdatatheycombine Theextenttowhichtheycoverdifferentaspectsofthecorporate

travelprogramandthecompanyswideractivities

ThetravelexpenseproductivityKPI,discussedinmoredepthbelow,incorporatesmajorcorporatemeasurementsfrombeyondtravel,includingincrementalsalesandturnover.

Attheotherendofthescale,shareofcorporatecardvolumemayinitiallylooknarrowandrelativelytrivial,butagoodcasecanbemadeforittoobeingacriticalstrategicKPI.ThecorporatecardKPI

assesseswhatpercentageofemployeeshavecorporatecardsand,moreimportantly,howmuchofthecompanystotaltravel&entertainment(T&E)spendischanneledthroughthecard.Thereasonthisisimportantisthatmostcorporationshavelimitedmeanstotrackspendbyemployeeswhileonatripotherthanthroughtheircardtransactions.Carddataalsohelpsverifypre-traveldatagainedfromtripreservations.

Maximizingspendthroughthecardisthereforeessentialformeetingimportantgoalssuchascost-containment,spendmaximizationthroughnegotiation,andcompliance.


The travel expense productivity

KPI incorporates major corporatemeasurements rom beyond travel,

including incremental sales and turnover


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WhichstrategicKPIsareinusetoday?

AnApril2010surveyofAssociationofCorporateTravelExecutives(ACTE)buyermembersforthiswhitepaperaskedparticipantsonbehalfofAdvitowhethertheycurrentlyusearangeofKPIs.ItalsoaskedthosewhodidnothavetheKPIsintheirprogramsiftheywouldliketointroducethem.

Thefiguresmustbetreatedwithgreatcautionbecausetherewereonly21answers,butthegroupwaswell-qualifiedandrelativelyhomogeneous,beingoverwhelminglycomprisedofU.S.-basedmultinationalcompanieswithmaturetravelprograms.

TheresponsessuggestthatthisgroupoftravelmanagersusealargevarietyofKPIs,althoughunsurprisinglyitisthemoretraditional,easilymeasurableindicators

whichpredominate,especiallythoserelatedtospendandcompliance.However,theguresalsoheraldsignicantpotentialforgrowthintwodemandmanagement-relatedKPIs:virtualmeetingsandtravelexpensesrelatedtoincrementalturnover.

Doesyourtravelprogramcurrentlyuse,orisplanningtouse,anyofthefollowingKeyPerformanceIndicators(KPIs)?

KPI Yes,currentlyused Notused,butwouldliketoimplement

Notusedandnotplan-ningtoimplement

Averagechangeinfare/rate 85.0% 5.0% 10.0%

Savings/Costavoidance 81.8% 13.6% 4.5%

Totaltravelspend 95.5% 4.5% 0.0%

Onlineadoption 80.0% 10.0% 10.0%

Operationalefciencies/processcosts 78.9% 15.8% 5.3%

TMCfees 85.0% 10.0% 5.0%

Travelexpensesinrelationtoincrementalbusi-nessrevenue/turnover

30.0% 30.0% 40.0%

Spendundertravelmanagementcontrolinrelationtototaltravelcategoryspend

57.9% 26.3% 15.8%

CO2emissionscausedbybusinesstravel 66.7% 28.6% 4.8%

Milesorhourstraveledperyearasapropor-tionofcorporaterevenues

21.1% 15.8% 63.2%

Volumeoncorporatetravelcardversustotaltravelspend

66.7% 9.5% 23.8%

Costoftraveldepartmentinrelationtotravelspend

26.3% 15.8% 57.9%

Travelagencyperformancelevel 86.4% 9.1% 4.5%

Policycompliance 85.7% 9.5% 4.8%

Usageofvirtualmeetings 42.1% 42.1% 15.8%

Economyclassratio 76.2% 4.8% 19.0%

Advancebookingratio 81.0% 19.0% 0.0%

Customer(traveler)satisfaction 77.3% 13.6% 9.1%

Source:Surveyofcorporatemembers,AssociationofCorporateTravelExecutives,April2010

Figure 2KPIscurrentlyinuseamongACTEcorporatemembers



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A detailed look at two strategic KPIsWehighlighttwoKPIshere:

Travel management services coverageAgoodexampleofhowastrategicKPIcanhaverelevancetomultiplehigh-levelcorporategoals

Travel expense productivityArguablythemoststrategicandalsomostcontentiousofalltravelKPIs

1. Travel management services coverageThisisthevolumeoftravelandentertainment(T&E)-relatedspendmanagedorinuencedthroughthetraveldepartment.LikethecardcoverageKPIdiscussedabove,itiscriticalbecausespendwhichisnot

managedcannotbecontrolled.

Incontrasttootherprocurementcategoriesinwhichmanagedspendreferstospendwithpreferredsuppliers,suchadenitionwouldbecounterproductivefortravel,astheprogramstrategymightbetocombinepreferredsupplierprogramswithlowerspotprices(e.g.,bestavailableratesorrestrictedpromotionalairfares).Withpolicycomplianceoftenoutsourcedtothetravelmanagementcompanyandconguredwithintheonlinebookingtool,Advitondsthatspendusingthedesignatedbookingchannelsinwhichthespendcanbeinuencedtotthecorporatepreferencesisagoodproxy.

Abilitytocontrolspendrelatesdirectlytokeycorporategoalsinmorewaysthanmayatrstbeapparent:

Cost containment/competitive procurement Onlyspendthatisidentiedandmanagedcanbeincludedinsuppliernegotiations.Furthermore,unidentiedspendisoftennon-compliant,meaningitisusuallymoreexpensivethanthatwhichischanneledtowardspreferredsuppliers.

SecurityUncontrolledtravelerscannotbetracked,makingitverydifcultforacompanytofulllitsdutyofcareobligations.Riskmanagementisastrategicpriorityformanybusinesses.

GovernanceEnsuringtravelersarecomplyingwithaccountingandotherlegalobligationsisincreasinglycrucial.

Efcient management of overhead resourcesThehighertheproportionofspendmanagedbythoserunningthetravelprogram,thegreatertheirproductivity.

Measurement difcultiesTravelmanagementservicescoverageisadifcultKPItomeasurebecauseitisdifculttoascertainhowmuchT&Espendisunmanaged.ExpenditurebookedthroughthecompanysretainedTMCand/ortransactedthroughacorporatecardcanberegardedasmanagedbutmuchoftherestconsistsofamixtureofknownunknownsand

unknownunknowns.

Agoodplacetostartistheexpensemanagementsystem.Ifitisfullyautomated,thencapturingthespendshouldberelativelyeasyprovidedthatexpensecategoriesarewelldenedandalignedacrossregionsandbusinessunits.Iftheexpensemanagementsystemissemi-automatedormanual(anExcelspreadsheet),ndingthenumberswillbemuchharder.Thenextplacetolookistheaccountingsystem,althoughT&Eexpenditureisnotalwayscodedastravel.Ifitisameeting,forexample,itmaybecodedasmarketing.

Thissortofforensicworkispotentiallyverytime-consuming,soitmaybe

necessarytomakeafewsampleinvestigations(e.g.,oneortwodepartments)andthenmakeeducatedassumptionsfortherestoftheorganization.

ObtainingacombinedmanagedandunmanagedT&Espendtotalis,therefore,alwaysgoingtobeaninexactscience.However,itcanstillbeaccurateenoughforthepurposesofthisstrategicKPI,whichistoprovideaninsightintowhethertheorganizationiscontrollingitsspendtoanacceptablelevel.Thefactthat58percentofrespondentstotheACTEsurveysaidtheydeploythisKPIshowsitcanbedone.



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2. Travel expense productivityReturn on investment in travel does it make sense?Thelastcoupleofyearshaveseenincreaseddebateaboutwhether

companiescancalculateareturnontheinvestment(ROI)theymakeintravel.Thishasresultedfromgrowingpressureonbusinessestojustifythesignicantcostbothnancialandenvironmentaloftheirtravelprograms.

TwowhitepaperspublishedlastyearstudiedtheU.S.businesstravelmarketandattemptedtoestablisharatiobetweentheamountcorporateAmericaspendsontravelandtheincrementalprotthisexpenditureachieves. 1Thestudiessoughttobuildthisratiothrougheconometricmeasurementsanalyzingtherelationshipbetweentravelspend,overallbusinessexpenditure,revenueandprotability.

Opinionamongtravelmanagementprofessionalsisdividedover

whetherthestudiesprovedaquantiablelinkbetweentravelinvestmentandprotabilityatanationallevel.Certainly,quanticationcouldnotbemadebyasinglecorporationforitsannualtravelbudget,stilllessonatrip-by-tripbasis.

Oneofthemanychallengesisthattravelisnot,innancialterms,aninvestment,sinceputsimplyitcannotbestatedasanassetonabalancesheet.TakingaightfromLondontoBeijingdoesnotofitselfgeneraterevenue,butissimplyacostofbusiness.Andevenifatripclosesasale,itisdifculttoisolatethatsingletripasthesoleinvestmentwhichgeneratedtheextrabusiness.AsthetravelconsultantScottGillespiehaswritten,therearenomeasurableoutputsrobustenoughtoapplytomosttripsormeetings,

andsturdyenoughtobemeasuredrepeatedlyandaccurately.

2

ROIAnappropriateKPIformeetingsmanagement?EvenifROIdoesnotconvinceasaconceptfortransienttravel,coulditbeausefulKPIformeetingsmanagement?Thephraseisusedmuchmoreofteninthiscontext,althoughitremainscontroversialformeetingstoo.

Intheory,ROIisappropriateformeetingsbecauseameetingisadiscreteeventwithnotonlyanidentiableinvestmentprogrambutalsoidentiabledesiredoutcomes.Examplesincludewhetherthoseattendingaproductlaunchforanewcarbuythevehicleingreaternumbersthanthosewhodonot,orwhethersalespeopleworkingtowardsatravelincentiveimprovetheirsalesgures.

Ofcourse,onlyasmallnumberofmeetingscanproducedirectlyquantiablenancialreturnsofthissort.However,theeffectivenessofmeetingscanbemeasuredinotherwayssuchastheimprovementindelegatesproductknowledge,orpre-andpost-eventsurveysoftheirsatisfactionwiththecorporation.

1Can we afford not to invest in business travel? ,IHSGlobalInsightandNationalBusiness

TravelAssociation,Sept.15,2009; Return on Investment of U.S. Business Travel,Oxford

EconomicsandU.S.TravelAssociation,September20092ROI on travel & meetings why bother?,GillespiesGuidetoTravel+Procurement

(http://gillespie411.wordpress.com),Feb.2,2010



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Travel expense productivity an indicator, not an absoluteTheideaofanROIforbusinesstravelishighlyalluringbecauseitwouldbetheultimatestrategictravelKPI.Ifoneconcurs,however,thatitis

impracticable,thentravelexpenseproductivitymaybethenextbestthing.ThisKPItrackschangeintravelspendagainstchangeinbusinessrevenue(salesturnoverandneworders)overtimetoprovidearoughindexofwhetheracorporations(orbudgetholders)expenditureontravelisatanappropriateleveltotherevenuethecompanygenerates.Assuch,theKPIgoesbeyondthetypicalaveragepriceperspectiveandincludesthenumberoftripstakenanimportantprerequisitetocapturetheimpactofdemandandbehaviormanagementinitiatives.

Inparticular,ifthisKPItrackswithinaconsistentpercentagerangeeitheracrosstimeoracrossdifferentbusinessunits,thenasuddenmoveoutsidethatrangecaneffectivelyraisearedag.Iftheratio

fallsdramatically,itmayindicatetravelhasbeencuttoomuchandthecompanyisfailingtobuildrelationshipsandpursuenewsalesopportunities.Iftheratiorisessharplybeyondthenormalrange,thenitcouldcreatediscussionoverwhethercertainprojectsorsalesprospectsjustifythecostofpursuingthem.

Clearly,therecanbemanyreasonswhichwouldexplainamarkedchangeinthetravelexpenseproductivityKPI,butatleastconstantmonitoringofthisindicatordrawsattentiontothesituationandpromptsaninvestigationintotheunderlyingreasons.Itisthereforeidealforchallengingbudgetholders,andcanproveausefultoolwhenacompanyplansnewprojects.Inparticular,seniormanagersoften

ndthemselvesunderpressurefrompotentiallyconictingstrategicobjectives,perhapstocontaincostsontheonehandbuttoglobalizetheirbusinessandincreaserevenuesontheother.ThisKPIcanhelpthemassesswhethertheyhavethebalanceright.AlthoughthisKPIishighlysophisticated,30percentofthetravelmanagersintheACTEsurveysaidtheyalreadyuseitandanother30percentwouldliketodeployit.

Tips on building a strategic KPI program

Step 1Takeitseriously

Aswithanyworthwhilecorporateproject,astrategicKPIprogramcannotbebuiltinanafternoon,norcopiedandpastedfromanothercompany(orthiswhitepaper,forthatmatter!).Itwillrequiretimeandeffort,asignicantlevelofstakeholderparticipation,andanappetiteforsweatingdataatamoreeffectivelevel.Consideralsothematurityofyourtravelprogram.Companieslackingawell-observedtravelpolicyand,aboveall,reliabledatasources(suchasaconsolidatedcorporatecardprogram)arelikelytondthistaskbeyondthem.ThosewithamatureprogramshouldnditrelativelyeasytocreatestrategicKPIsand,indeed,arealreadylikelytohavesome.

Step 2Mapoutyourcorporatestrategicgoals

Createalistofyourcompanyscorestrategicgoals.Agrosslysimpliedexampleofsuchalistcouldbe: Costcontainment Sustainability Dutyofcare Governance/compliance Traveler(oremployee)productivityandsatisfaction



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Step 3MapoutyourtravelprogramgoalsMapoutwhichaspectsofyourtravelprogramrelatetoyourcorporatestrategicgoals:

Cost containmentreducedtravelpurchasingcosts,reducedtravelprocessingcosts,reducedtripvolumes

o Travel program goals: savings/cost avoidance, demandmanagement, negotiation/sourcing

SustainabilityreducedCO2emissionscausedbybusinesstravel o Travel program goals: sustainability, demand management Duty of careensuringtravelersecurity,safetyandwell-being o Travel program goals: security/duty of care, traveler satisfaction Governance/compliance e.g.,Sarbanes-Oxley,codesofcompliance

forpharmaceuticalsindustrymeetings o Travel program goal: compliance

Eventhoughmanycorporationssharetop-levelgoals,therankingoftheirimportancetothecompanyandtheirprecisedenitionvarysignicantly.Itisthereforecrucial,aspartofthiseffort,tounderstandthecorporationsgoalhierarchyandseniormanagementexpectationsforthepresentandforeseeablefuture.Rememberalsothateveninpubliccompaniessomegoalsarenotstatedformallybutareappliedaspartofacompany-wideinitiative(e.g.,anincreasedfocusonsustainability)oremergingconcepts(e.g.,afocusoninnovationbypromotingcollaboration).

Step 4 DenetheappropriateKPIstomeasureyourprogressOnceyouunderstandhowyourtravelprogramgoalsrelatetoyourcorporategoals,youcancreatestrategicKPIstomeasurehowwellyouareperforminginachievingeachofthem.Makeaninventoryofrelevant

metricsyouusealreadyaspartofmanagingtheprogramonaday-to-daybasisandidentifygaps.ConsiderapplyingsomeofthesamplestrategicKPIsprovidedingure1togetstarted.

Asademonstrationofhowthatexercisemightgetunderway,wehavegroupedthesampleKPIsbytheirprimarygenerictravelprogramgoals(Figure3).BecausemanyKPIssupportseveralgoals,creatingamatrixthatmapsKPIsandprogramgoalscanalsobehelpfultomanagecomplexity.

Case study

TheEADSscorecardEADShascreatedascorecardfortravelthatbreaksdownintothefollowingfourcategories: Demand managementIncludesnumberofvideo-conferencingsessions

per1,000oftravel;andutilizationofvideo-conferencingfacilities Tracking spend versus budgetWeeklymeasurementforeachcost-

center Process effectivenessWiderangeofKPIs,suchasonlineadoption,

coveringentireprocessfrombookingtoexpensereclamation Supplier performance and value-addIncludestravelersatisfaction,

processingofexpensereportswithinagiventime,etc.

EADSisconsideringaddingafthelementtoitsscorecardintheformoftravelerwell-beingandcorporatesocialresponsibility,butisstrugglingtondtheappropriateKPIs.Iwouldliketoseemetricsintroducedthatmeasurehowwellwearelookingaftertheenvironment,saysheadofextendedtravelenterpriseJamesWestgarth.



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Goal KPI


PolicycomplianceTravelmanagementservicescoverageValueofmanagedtravelChangeintotaltravelcost

DemandManagement

ClimateimpactofbusinesstraveltransportreductionTravelexpenseproductivityTravelintensityVirtualmeetingindexChangeintotaltravelcost

Negotiation/

Sourcing

Shareofcorporatecreditcardvolume

TravelmanagementservicescoverageValueofmanagedtravel

Compliance/BehaviorManagement

PolicycomplianceTravelmanagementservicescoverageTravelexpenseproductivityValueofmanagedtravel

Sustainability ClimateimpactofbusinesstraveltransportreductionVirtualmeetingindex

Security/DutyofCare

TravelmanagementservicescoverageTravelintensity

TravelerSatisfaction Travelagencyperformanceindex

Figure 3KPIsgroupedbytravelprogramgoal Asyoucanseefromtheselection,strategicKPIsarenotabsolutenumbers.Theyaremetricsrelatedtoagivenbaselineinordertobemeaningful;thisrelationshipcouldbe,forinstance,eitherchangeover

time(e.g.,currentperiodagainstpreviousperiod),changeagainstabenchmark(e.g.,changeinpriceagainstchangeinmarketindex)oratravel-specicmeasureagainstabroadercompanymeasure(e.g.,travelexpenseproductivity).

EachstrategicKPIistypicallysupportedbyseveralsimpler,tacticalKPIs.Theseareoftenmetricsthatyoualreadyuseandhavelistedintheinventory.

WhilethestrategicKPIswillbeusedforpurposessuchasexecutivescorecardreviews,thetacticalKPIsbuildupmoreofthegranularinsightatravelmanagerneedsforday-to-daycontrolandquickperformance

dashboards.

TomapoutwhichtacticalKPIislinkedtowhichstrategicKPIisausefulexercisetodocumentthecause-and-effectofhowacertaininitiative(e.g.,adrivetomaketravelersbookearlierasmeasuredbythetacticalKPIadvancedbookingratio)caninuenceothertacticalKPIs(e.g.,averagesegmentfare)whichultimatelylinktoastrategicKPI(e.g.,changeintotalcostoftravel).

NotalltacticalKPIshaveconnectionswithstrategicKPIswhicharethereforeultimatelylinkedtocorporateobjectives.Butevenifameasurementcannotbelinked,itdoesnotmeanitshouldbe

abandoned.Itmaybeveryrelevanttowhatyouaredoingbutcannotbeusedasproofofprogressagainstspecicobjectives.



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Step 5IdentifymasterdatasourcesEventhebest-denedandmostcarefullyconsideredKPIsareuselessiftheycannotbesupportedbyqualitydata.Mostcorporationsuse

avarietyofdatasourcestomanagetheirtravelspendallwithadifferentscope,levelofdetail,reliability,etc.(Figure4).Whileconsolidateddataistheholygrail(seeSection3),forthepurposeoftrackingKPIsitisinitiallyjustasimportanttoidentifywhichdatapointintheformulaforeachKPIshouldcomefromwhichdatasource.

Bepreparedtolookinsomeunfamiliarareasfordatasources.Forexample,theEADStravelteamisworkingwiththegroupsfacilitiesmanagementdepartmenttoobtaindataonvideo-conferencingforitsdemandmanagementKPIs.

Formoreonsourcingdata,seepage29.

KPI Suggesteddatasource

Travelmanagementservicescoverage

Onlinebookingtool(OBT)Travelmanagementcompany(TMC)Financialsystem

Virtualmeetingindex

ExpensemanagementsystemFacilities/IT

Valueofmanagedtravel

ProcurementtoolExternalstudies,marketindexreports

Travelexpenseproductivity

ExpensemanagementsystemEnterpriseresourceplanningtool(ERP)

Travelintensity ExpensemanagementsystemTMC

OBTPolicycompliance Travelmanagementservicescoverage

Travelintensity

Travelersatisfaction TMCOBTExpensemanagementsystem

Changeintotaltravelcost

Expensemanagementsystem

Climateimpactofbusinesstraveltransportreduction

CardproviderTMCIndividualsuppliers(e.g.,rentalcar,rail)

Shareofcorporatecreditcardvolume

CardproviderExpensemanagementsystem

Travelagencyperformanceindex

ProcurementtoolCommunityrating/TravelmanagementsocialmediatoolTMC

Figure 4KPIdatasources(sampleforillustrationonly)


Even the best-defned and most careullyconsidered KPIs are useless i they

cannot be supported by quality data


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Step 6TrackandactonthedataStepsonethroughvewillonlyproveworthwhileifyoutrackandactonthedata.

Useyourdatatoestablishbaseline;workwithstakeholderstoestablishatargetortargetrangeagainstwhichprogresswillbemeasured.Recallthatvariancefromatargetrangecanbenoteworthy:IfyourKPIstrackwithinaconsistentpercentagerangeeitheracrosstimeoracrossdifferentbusinessunits,thenasuddenmoveoutsidethatrangecaneffectivelyraisearedag.

Crucialtomakingdataactionableistheefforttomakeitquicklyandeasilyunderstandable,bothpurelyvisuallyandinthecontextofoverallcompanyexpectationsorprecedentsfordatarepresentation.

Travelmanagerswillgenerallyndthattheyhaverecoursetodashboards

and/orscorecardsfortherepresentationoftheirKPIdata;thechoiceshouldbedrivenbytheneedsofthetargetaudienceforthedata.Scorecardsinherentlymeasureagainstgoals,dashboardsneednot;dashboardspresentrawnews,whilescorecardsareeditorialsofsorts.

Ascorecard,whichisusuallypartofabroadercorporatemethodologyandisareportcardofhowagivenperson,businessunitorentityperformswithrespecttocertaingoalsoveragiventimeperiod,canbeusefulinpresentingKPIstoC-suitemanagement.Adashboard,asasetofindicatorsaboutthestateofandreal-timechangestotacticalinformation(oftendisplayedascharts,graphsorgauges),isoftenmostusefulforstakeholdersinvolvedinthenutsandboltsoftheprogram.

Atrafclightsystemisaclassicdashboardcomponent,placingamberagsagainstKPImeasurementsthatfallslightlyoutsideanexpectedrangeandredagsagainstmeasurementsmoresignicantlyoutsidethoseranges.

Dashboardsvs.scorecards

Bothdashboardsandscorecardsdisplayperformanceinformationinacompactway,buttherearedifferencesbetweenthetwo.

Dashboard Scorecard

Purpose Displaysperformance Displaysprogress

Usage Performancemonitoring Performancemanagement

Updates Real-timefeeds Monthlysnapshots

Data Events Summaries

Context Exceptions,alerts Targets,thresholds

Source Linkedtosystems Linkedtoplans

Source: Dashboard or Scorecard: Which Should You Use?,The Data Warehousing Institute, Jan. 2005



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Amberandredagscanthenbeinvestigated,boththroughquantitativeandqualitativesources,tounderstandwhathascausedthevariationfromtheexpectedrange.Quantitativesourceswillmostlikelyincludescrutinyof

tacticalKPIs.Qualitativesourcescouldincludetalkingtocolleaguesinlocalmarkets.

ThegoodnewsisthatstrategicKPIsareinherentlypowerfulcatalystsforactionbecausetheyaredesignedforseniormanagementtoview,understandandauthorizeresponses.ItshouldthenbepossibletomonitorwhethertheactionstakenhavebeensuccessfulbyseeingwhethertheKPIsreturntotheirexpectedranges.

Eveninthepost-recessionlandscape,manytravelmanagersarestillnotmeasuredbeyondthesavingstheyachieveinindividualtripcomponentsandonlineadoption.Thisshouldnothindertravelmanagersfrom

proactivelyapproachingthestrategicprogramKPIsthatgobeyondtheirdirectresponsibility.Atravelmanagercanandshouldplaytheroleofaprocessownerwhoensuresthatthebiggerpictureisbeingaddressedandmanagedfromatotalprogramperspective.ForeachKPI,theyneedtoidentifywhoholdsultimateresponsibility.

Forinstance,travelmanagerscaninuencebutnotcontrolthenumberoftripstaken;theKPIsoftravelintensityandvirtualmeetingindexaretypicallycontrolledbytheactions(andnon-actions)ofdepartmentheadsorbusinessunitleaders.Thetravelmanager,however,canusetheKPItodiscusswhatdrivestravelerbehaviorandrecommendwaystoimproveperformance.

Suchdialoguewithkeystakeholders,withthetravelmanagerasfacilitatorandadvisortothebusiness,promotesoverallprogramstrengthandhighlightsthevaluethattravelmanagementcanbringtothecorporation.

Case study

EADStakesactiononhighfaresEADSregularlysummarizesitstoptenaveragecity-pairfareincreases.Thetravelteamrespondstothisdatawithdetailedinvestigationstounderstandwhythefareswentupandhowtoremedythesituation.Amongthereasonsforincreasesittypicallydiscoversare: Negotiationsshouldhavebeenmoreaggressive Anairlinehasquittheroute,reducingcompetition Themainfareclassusednolongerexists Inaccuratefareloading

Asaresult,remedieswhichcanbeappliedinclude: Betternegotiation

Re-congurationofbookingtooltoreectnewbookingclass Loadingofcorrectfares Bettercommunicationwithtravelersaboutwhichairlinetouse



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Cost containment is a primary strategic objective at mostcorporations, so savings measurements naturally eature among

their strategic KPIs. However, these measurements need to bethe right measurementsones which provide true insight intowhether the actions the company is taking are reducing the costo travel. Thatmaysoundobvious,butinrealitybusinessesdonotalwayscreate

savingsmeasurementswhicharemeaningful.Knowinganaverageticketpriceis$200,forexample,isnotparticularlyhelpful.Evenknowingthatlastyearitwas$250isnotnecessarilyhelpfuleither.Knowingyouhadthepotentialtobringitdownto$180butonlyachieved$200,ontheotherhand,isuseful.

Goingfurther,thecasecanbemadethatsomeKPIsarepotentiallycounter-

productive.Theycandrivebuyingbehaviorthatpushesupthecostoftravelasbuyersorbudget-holdersmakedecisionswhichhelpthemmeettheirtargetsbutarenotbenecialoverallforthebusiness.

Stage 1LayeredmeasurementThekey,therefore,tomeaningfulsavingsmeasurementistoprovidecontext.Asastartingpoint,travelmanagerscanapplygenericprocurement/nancemeasurementapproaches.

1. Change in price(i.e.,(averagepreviouspriceaveragecurrentprice)xcurrentunits)Thisisanattractivemeasurementbecauseitiseasytomake,butitslackofcontextmakesitoflimiteduseinisolation.Withtravelbeingarecurringdemandthislookslikeagoodapproach(andisoftenmandatedbythenancedepartment).However,themeasurementcanbedeceptivebecausecomparingspendyear-over-yearormonth-over-monthgivesanillusionofmeaningfulcontext,especiallyforastakeholderinahurryandwithoutfullunderstandingofthepricedriversintravel.Anadditionallimitationisarelianceonaforecastedorexpecteddenitionofprice.Oftenprocurementtracksthenegotiatedprice

ratherthanactualpriceachieved.Thisanimportantdrawback,sinceitmeansthatsavingsmighthavebeenachievedonpaperonly,withtravelerpreferenceandbehavior,restrictedavailabilityandother

factorsoftencreatingamajordifferencebetweennegotiatedpricesandactualprices.

2. Change in price against change in market indexAveragefaresandhotelratesaresubjecttomarketdynamicsandvolatileunitpricesresultingfromyieldmanagement(eitherthroughactualpriceuctuationsorinventorymanagement).Consequently,amorerealisticperspectivecanbeobtainedbylinkingachievedfaresandratestoanindexshowingotherpricesbeingpaidinthesamemarket.

Inturn,indexingcreatestwochallenges: Whatistherightindex?Thelevelofgranularitycanmakeabig

difference.ForaccommodationinNewYork,forexample,doyoumakeyourindextheaveragedailyrateforupperupscalehotelsinManhattan,businesshotelsinthewholeofNewYorkCity,allhotelsinthestateoranevenbroaderbase?

Manynancedepartmentsinsistonastrictsavingsdenitionofabottom-linepricedecrease.Thismeansthatsavingswhichbeatthemarketbutarenotrealsavingsarereferredtoascostavoidance.Eitherway,wesuggesttrackingbothmeasurementsandbeingconsistentinthewayapricechangeismeasuredandpublished.

Theimportanceofunderstandingtheoptionsofhowsavingsmaybedened,andofunderstandingtheimplicationsandprosandconsofthedenition(s)yourorganizationchooses,cannotbeoverstated.Theperfectdenitionmaynotexistor,atbest,willvaryfromcompanytocompanybutyourprogramwillbenetfromyourawarenessofyourchoicesandtheirconsequences.3

Section 2 | meaningful savings measurement

3Foranexcellentintroductiontocommonsavingsdenitionsandtheirimplications,see

Savings Metrics, Rat Farms and KPIs Gone Bad,GillespiesGuidetoTravel+Procurement

(http://gillespie411.wordpress.com),Jan.29,2010.


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Market/Destination

AverageRNpriceJan-Jun09

AverageRNpriceJan-Jun08

Roomnights(total)Jan-Jun09

Roomnights(total) Jan-Jun08 Totalrevenue09 Totalrevenue08

Marketindexdevelopment

Volumevariance

Costevolutionduetopricevariance

Costevolutionduetohotelindustrypriceevolution

Addedvalueofprocurement

SYDNEY 160 212 500 240 80,000 50,880 1% 55,120 -26,000 1,005.51 27,005.51

SHANGHAI 168 167 50 60 8,400 10,020 -13% -1,670 50 -1,107.16 -1,157.16

CAIRO 134 96 70 60 9,380 5,760 -6% 960 2,660 -396.48 -3,056.48

DELHI 94 130 40 50 3,760 6,500 -21% -1,300 -1,440 -1,076.70 363.30

SEOUL 235 175 500 600 117,500 105,000 4% -17,500 30,000 3,106.38 -26,893.62

BRUSSELS 185 275 800 900 148,000 247,500 -3% -27,500 -72,000 -5,592.45 66,407.55

COPENHAGEN 178 270 700 80 124,600 21,600 -4% 167,400 -64,400 -7,220.47 57,179.53

PARIS 199 242 2,500 1,500 497,500 363,000 -2% 242,000 -107,500 -12,523.50 94,976.50

FRANKFURT 147 193 1,000 600 147,000 115,800 -5% 77,200 -46,000 -9,688.60 36,311.40

BARCELONA 164 187 2,300 2,000 377,200 374,000 -7% 56,100 -52,900 -30,584.43 22,315.57

LONDONUK 155 199 1,800 2,000 279,000 398,000 -8% -39,800 -79,200 -28,548.54 50,651.46

MEXICOCITY 164 153 200 140 32,800 21,420 15% 9,180 2,200 4,714.34 2,514.34

VANCOUVER 128 147 400 300 51,200 44,100 -1% 14,700 -7,600 -305.76 7,294.24

HOUSTON 185 163 600 780 111,000 127,140 0% -29,340 13,200 -419.54 -13,619.54

NEWYORK 205 276 1,800 1,200 369,000 331,200 1% 165,600 -127,800 2,484.00 130,284.00

13,260 10,510 2,356,340 2,221,920 671,150 - 536,730 -86,153.41 450,576.59

Case studyHowNestlmeasureshotelsavingsthroughvolumevariance

andmarketindicesNestlistheworldsleadingnutrition,healthandwellnesscompany.Itstravelprogrammanagementprovidesamatrixofitsyear-on-yearincrementalroomratesavingsineverydestinationworldwide.Itthenaddstwoindicestogivetheguresmeaningfulcontextandcalculatethevaluecreatedbytheeffortsoftheprocurementdepartment:

Volume varianceHowmanyroomshasthecompanybookedatthatdestination?Iflastyearwehad17percentfewerbookingsthantheyearbefore,thatwillhavehadaneffectonsavingsbecauseitmeantwe

didnothavethevolumetonegotiateforthisyear,saysBrendaMiller,globalmanagerfortravelandmeetingserviceswithNestl.

Market indexThistrackshowNestlsaveragenegotiatedrateatadestinationcompareswiththebenchmarkedaveragenegotiatedrateachievedbyotherbuyers.IfNestlisalreadyachievingagoodraterelativetoitspeers,thenitcannotexpecttoseeitsaverageratefallasfastastherestofthemarketinthenextroundofnegotiations.Thenewratewillstillbebetterthantherestofthemarketbutthesavingisnotgoingtobeasmuchincrementally,Millersays.Figure 5Nestlsamplehotelsavingsmatrix(AllguresinU.S.dollars)


Denitions:Market index development =currentmarketindex-previousmarketindexVolume variance=(currentroomnights-previousroomnights)xcurrentprice

Cost evolution due to price variance=(currentprice-previousprice)xcurrentroomnightsCostevolutionduetohotelindustrypriceevolution=(previouspricexmarketindexdevelopment)xcurrentroomnightsAdded value of procurement=((previouspricexmarketindexdevelopment)-currentprice)xcurrentroomnights


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Millerbelievesthetwoindices,whichshealsousesforairtravel,giveamuchmoreaccuratepictureofhowherdepartmentisperforming.Inthersthalfofthisyear,airlinesmademorefaresavailableinlowerbusiness-

classbuckets,shesays.Thatincreasedaccessfortherestofthemarket

tolowerfaresandbroughtaverageticketpricesmuchclosertothegoodfareswewerealreadygetting.Thenumbersweprovideexplainedthat.Ontheotherhand,thenumbersalsoshowthevaluewebringtothecompanys

travelprogramratherthanjusttakingadvantageofthedownturn.

3. Sourcing performance metrics (e,g., discounts achieved by changingrequirements, using e-auctions, etc.)Thesespecicmeasurementsarehelpfulforassessingwhatimpacttheprocurementprocesshadinachievingalowerprice.However,onceagaintherearepotentialpitfallstobeawareof:Unit price of old contracts versus unit price of new contracts

Thismeasurementtracksthelevelofdiscountbuyershaveobtained,butcanbemisleadingifitinadvertentlyrewardsbuyersforconcentratingonthehighest-pricedfareorratecategorieswherethepotentialforobtainingdiscountsisgreatest.Published unit price versus negotiated unit priceThismeasurementpotentiallyencouragesbuyerstoworkwithhigh-marginsupplierswhohavethegreatestcapacityforofferingdiscounts.Thecorporationmightobtainfarlowerpricesbyusingalow-costcarrier,butsincebudgetairlinesdonotusuallyoffercorporatediscounts,thebuyerwouldnotberecognizedorrewarded.Withincreasinglysophisticatedyieldmanagementtechniquesandtheincreasingprevalenceofbestavailablerates,lookingatnegotiatedunitpriceisinanycasebecominganincreasinglyanachronisticformofanalysis.

Behavioral savingsTheaimofbehaviormanagementistoimprovecompliancetopolicyandideallytoachieveresultsbetterthanpolicy.Savingsthroughbehaviormanagementthusrefertoequippingtravelerswiththetoolsandmotivationtodotherightthing.

Travelmanagerscancomplementsupplierprogramswithbest

availablemarketprices(alsoknownasspotairfaresandspothotelrates),initiateprojectstoincreasetheadvancebookingratioandruneducationandawarenessprograms.

Withmostorganizationswithsignicanttravelspendhavingmaturepreferredsupplierprogramsandminorincrementalsavings,thepotentialthatcanbeachievedthroughbehaviormanagementissignicant.Asthesesavingsfalloutsidetraditionalprocurementmetrics,itisimportanttodenerelatedmetricsandachieveconsensusonhowtheymightbeconsideredinthesavingframework.

Onepointofcaution:Oftensavingsareclaimedpredictivelyfollowingnegotiation.Behavioralsavingsinitiativeswilltendtohelpyourealizethesavingsyouvealreadyclaimed.Itisimperativetounderstandtheoverlapandavoiddouble-countingthesuccessachieved.



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Demand managementButalloftheabovecontextualizationstillfailstopresentacompletesavingspicture.Forexample,whataboutdemandmanagement?Most

ofthediscussionabovehasbeenaboutcostpertrip,butthenumberoftripsacompanymakesaffectsitsleveloftravelexpenditureevenmoreprofoundly.

Traditionally,numberoftripshasnotbeenconsideredrelevanttosavingsmeasurement,becauseprocurementhasnotbeeninvolvedinmakingdecisionsonwhethersomeoneshouldtravelornot.Suchattitudesarenowchangingwiththeevolutionofdemandmanagement,forexamplethroughencouragingvideoconferencingandothertravelalternatives.

Demandmanagementappearstobemakinganimpact,butitis

animpactthatishardtoquantify.Howcanonedemonstratethataspecicprocurementortravelmanagementprojectreallyledtosendingonlyoneemployeetoameetinginsteadofseveralorreplacingthattripwithavirtualmeeting?

Forthetimebeing,savingsconsideredattributabletodemandmanagementaretypicallycategorizedascostavoidancebuttheyremainimportanttotrackaspartofthetotalcostperspective.SomeofthestrategicKPIsprovided,suchastravelexpenseproductivity,travelintensityandvirtualmeetingindexwillhelpcompaniesgetclosertoprovidinghardfacts.

Case studyNestlmeasuressavingslostthroughtraveler

behaviorNestlprovidesadashboardreporttoC-levelexecutivesdetailinglostsavingsowingtotravelerbehavior.Thereportincludes: Ticketsissuedwithinsevendaysoftravel Lowestfareswithinpolicynotaccepted Missedroomnightsi.e.,whentravelershavebookedaightinvolving

overnighttravelbutnotbookedahotelroomaswell Onlinebookingadoption

Itmaysoundobvious,but

Thereisabigdifferencebetweenclaimingnegotiatedsavingsandactualsavings.

Savingscriteriaalwaysneedtobeclearedwiththenancedepartmentinyourorganizationsometimescostavoidancecanbeclaimed,sometimesnot!



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Stage 2Puttingitalltogether:thesavingsKPIhierarchyAshasbeenseen,trueunderstandingofsavingscanonlybeachievedbymeasuringnumerousinuencingfactors,bothinternalandexternal.

Theseincludemarketdevelopments,theactionsoftheprocurementdepartmentandthebehavioroftravelers.LookingatthebigpicturemakesitclearthatmanyofthestrategicKPIsdiscussedearlierinthis

whitepaperaredirectlyorindirectlyrelevanttoachievingsavings.Theyincludeeverythingfromonlineadoptionratetousageofvirtualmeetingstopolicycompliance.

Totiethemtogether,itisusefultomapthemoutasahierarchy.AnexampleofsuchahierarchythatincludesstrategicandtacticalKPIsisincludedinFigure6.

Figure 6KPIhierarchy:Savings


StrategicKPIasfeaturedinthiswhitepaper

Other/TacticalKPI

ValueofManagedTravelNetCostofServiceRatioChangeinTotal

TravelCost

ChangeinAverageCostperTrip TravelIntensity

VirtualMeetingIndex

TravelManagementServicesCoverage


SavingsagainstMarketIndex

PolicyComplianceAdvanceBooking

Ratio

EconomyClassRatio

ChangeinNegotiatedPrice

CashDiscountsOnlineAdoptionRate

Process Efficiency Sourcing Behavior ManagementDemand

Management


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Thehierarchicalapproachillustratedhereforasavings/costavoidancestrategicobjectivecanofcoursebeappliedtoallstrategicobjectives(i.e.,sustainability,travelersatisfaction,etc.)

Thisillustrationisalsosimplied;readersmayrightlynotethattherearepotentialoverlapsintheassignmentofKPIstofoundationcategories(i.e.,ProcessEfciency,BehaviorManagement).Onlineadoptionratecould,forexample,beplacedunderBehaviorManagement.Thestructureofthehierarchywilldependonanindividualcompanyspriorities,strategy,initiativesandcompanyculture.

Itshouldbeclearbynowthatthequestforaperfect,20/20visionofsavingsisonethatcanneverbefullyachieved.However,judicioususeofKPIsandanunderstandingthatsavingshavetobemeasuredfrommultipleperspectivescangivebuyersmorethanenoughvisibilityto

reducecostwithintheirorganization.

Case study

Budgettracking,demandmanagementandfareriseinvestigationshowEADSmeasuresitssavings

LikeNestl,therearesomedistinctiveaspectstotheEADStravelsavingsstrategy.

Tracking spend versus budgetPrimarily,EADStakesatop-downapproach.Wenditmuchmoremeaningfulifthegroupsetstargetsforhowmucheachbusinesscanspendontravel,saysheadofextendedtravelenterpriseJamesWestgarth.Financialcontrollersarewellawareofwhatthetargetsare.Wemeasure

whethertheyhitthem.

Cost analysisEADSdividesitscostanalysisintothreecategories: Unitcostthetraditionalareaoftravelmanagement.LikeNestl,

thereissignicantfocusonbookingbehavior,includingaveragetimebetweenbookinganddeparture,usageofrestrictedticketsandnumberofhotelbookingsinpolicy.

Transactioncoste.g.,onlineadoptionrate(bookingofinegeneratesahigherTMCfee)

Effectivemanagementofdemandattemptingtoquantifyhowmuchissavedbyeliminatingtravel.EADScollectsdataonuseofvideo-conferencingandhasalsointroducedaprogramtotrackwhethertwopeoplefromthesamecost-centeraretravelingtothesamedestinationonthesameday.Anyduplicationishighlightedinthetravelersitinerariesanditisloggedifoneofthemcancelstheirtripinconsequence.


The structure o the hierarchy will

depend on an individual companyspriorities, strategy, initiatives and

company culture


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Creating actionable intelligence is only possible i the travelmanager has access to clean, comprehensive data. Sourcing

data, then combining and managing it is thereore an essentialpart o a strategic travel teams job description. This sectionoutlines some o the most important points or dealing withthese logistical tasks.

Sourcing dataOneofthechallengesfacedbytravelmanagersisthattheyhavetoco-ordinatefeedsofdatafrommultiplesources.ThesurveyofACTEtravelbuyermembers(mostlyfromU.S.-basedglobalcompanieswithmaturetravelprograms)carriedoutinApril2010provesthepoint(Figure7).

Corporatecardprovider(86percent)andTMC(82percent)arethemostpopularsourcesbuttravelexpensemanagementsystem(59percent)andaccountspayable(50percent)arealsousedbyatleasthalfofrespondents.

Acco

untsp

ayable

Creditc

ard

ERP

system

(from

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alLe

dger)

Onlin

ebo

oking

system

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ncyMIS

Trav

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eman

ageme

ntsystem

Spen

dman

agem

ents

yste

m

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er

50.0%

86.4%

81.8%

31.8%

18.2%

Figure 4Whatareyourprimarysourcesoftravelexpensedataforreportingandbudgeting?Checkallthatapply.

Source: Surveyofcorporatemembers,AssociationofCorporateTravelExecutives,April2010.

Section 3 | Sourcing, combining and managing data


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Workingwithinternalsourcescanbeproblematicbecauseexpensecategoriesoftenvaryacrossthebusiness.Thisleadstosometravel-relatedexpensesbeingmissediftheyare,forexample,labeledas

training.

However,asthesurveyindicates,managersofmaturetravelprogramsusuallyhaveaccesstohigh-qualitydatafeedsthroughthosetwocrucialexternaldatachannelscardandTMC.Ifahighpercentageofspendisnotdirectedthroughthesetwochannels,anyattemptstoanalyzeandactupondatawillproveanuphillstruggle.Ifahighpercentageisdriventhroughthem,thereiseverychanceofsuccess.Travelhasabigadvantageoversomeotherprocurementcategoriesbecausewehavegreatdatasuppliers,saysNestlglobalmanagerfortravelandmeetingsBrendaMiller.

Combining dataEventhoughtravelmanagershaveaccesstosomeexcellentsourcesofdata,therecan,formanyreasons,begapsandoverlapsinthosesourcescoverage.Asanexampleleavingasidedataconsolidationcapabilities,thetravelmanagementcompanyprimarilyprovidesdatabasedonbookingsmadeviatheagency.Sothissourcemissesmostoftheon-tripexpensessuchasmealandtaxi.

Andevenacardcannotoffereverything.Thedetailprovidedbyindividualplasticcardsisoftensparse,especiallycomparedwithcentralbillingaccounts(alsoknownaslodgecards),andsomecardshavebetterlevelsofacceptancethanothers.Also,manyprogramseveniftheyoffercorporatecardscannotmandatetheiruseandthusmissoutonimportantspendinformation.Theexpensemanagementsystemisthesourcethatshouldhavethebroadestviewontravel-relatedspendinformation,butunfortunatelyoftendoesnotprovidesufcientdetail.

Case studyWhereEADSsourcesitsdataInitially,theEADStravelteamgathereditsdatafromthreeprincipalsources: Pre-trip:ReservationsdatathroughTMCandonlinebookingtool Ontrip:Corporatecard Post-trip:Expenseprocessingprovider

Ithasnowaddedfourmorecategoriesofdata: Technicaldata:e.g.,onlinebookingresponsetimes FinancialandHRdatafromERP:e.g.,personnelhierarchies Travelerdata:e.g.,satisfactionsurveys Facilitiesdata:e.g.,video-conferencingutilization

Itisthereforecriticaltoconsolidatedifferentdatasourcestoobtainafullpicture.However,somedegreeofprioritizationisalsonecessary:selectamastersourceforeachdatapointthatdrivesaKPIandthenselectothersourcestoprovidecomplementaryinformation.

Data for negotiationThemoresophisticatedtypesofspendandsupplieranalysisrequirecompaniestosynthesizedataabouttheirownexpenditurewithexternalinformation,e.g.,benchmarkedspendingofpeercompanies,orevenairlineschedules.



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Data warehouses the optionsTravelbuyerswhousemorethanonesourceofdataoftenconcludetheyneedamechanismtocombinethem,usuallyinwhatiscalledadata

warehouse.Icantemphasizehowimportantadatawarehouseis,saysEADSheadofextendedtravelenterpriseJamesWestgarth.Thereisaninitialinvestmenttogetitupandrunning,butonceinplaceitpaysforitselfrepeatedly.

Therearethreebasicoptionsforcreatingadatawarehouse:

In-houseThiscouldbeastand-alonedatawarehouseoritcouldbeonealreadyusedforotherfunctionswithintheorganization,suchasanERPsystem.Ifthatisthecase,thenfeedinglinksfromkeytravelproviderscanbestraightforward,andthetraveldatawillbereportedonthecompany

protandlossstatementsasalineitem.However,extraresourceswillbeneededeitherwaytosupportaninternalsolution,whetherstand-aloneoraspartofalargerdatawarehouse.Settingthisupcouldbeslowandcostly,butonemajoradvantageisthatthenalproductisguaranteedtobecompliantwithinternalprocesses.

OutsourcedThistaskcanbehandedtoanexistingtraveldatasupplier,suchasaTMCorcardprovider,ortospecialisttraveldataconsolidatorssuchasTRXorPrism.Oneadvantageofoutsourcingisthatthirdpartiesaresubjectmatterexpertswhoarefasttoimplementandarewellawareofthepitfallswhichobstructthepathtoaccurate,consolidateddata.Theirexibilityandsecuritystandardsareofanacceptablestandardformostcorporations.However,bewareofonepotentialproblem,whichisthepossiblereluctanceofotherdatasupplierstohandoffdatatotheoutsourcedprovider.

HybridAhybridsolutionisforathirdpartytobuildandhostthedatawarehousebuttomanipulateandcontrolitin-house.Thiscanbedone

throughasoftware-as-a-servicelicense.Itworksparticularlywellifthetravelteamincludesadedicateddataanalyst.

Yetanotheroptionistocreateahybridtheotherwayround,anoptionfavoredbyEADS.Thebestanswerforusistohavethedatawarehousecreatedinternallybutmanagedexternally,saysWestgarth.Iamveryinterestedinoutsourcingourdatamanagementbecauseitisnotacorecompetence.However,notonlydoestheoutsourcedpartyneedgoodtechnicalskills,butitneedsfunctionalskillstodelivertherightreportsontime.

Analyzing data

Addedtothequestionofoutsourcingdatamanagementisthequestionofwhetheratravelteamhasenoughexpertisein-housetoanalyzeitsdata.Someofthemostdetailedanalyses,suchasforairlinecontracting,requirepowerfulanalyticalenginesandscenariomodeling.Manybuyersconcludetheycannotperformsuchtasksaloneandturntoaconsultancywhichcanintegrateightscheduledata,discountdata,marketforecastandairlinecostdata,andthencreateanalgorithmtoprovidearangeofnegotiatingoptions.



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As the section on measuring savings demonstrated, measurementscannot be looked at in isolation. They need context, such as

historical comparisons and market perspectives. In addition,companies oten fnd it useul to compare perormance betweenbusiness units internally, and they also like to make comparisonsexternally with peer companies. Comparisons o this natureespecially externallyare known as benchmarking.

Therearenumerouswaysinwhichcompaniescanbenchmarkagainsteachother,includingcomparingstrategies,processesandperformance.Atitsmostbasic,benchmarkingisafour-stepprocedure:

1. Mapoutyourownexistingbusinesspractice.2. Analyzethebusinesspracticeofpeercompanies(similarindustrysector,similarsize,similarspend,similarpolicy,similargeographicspread,etc.).Beawarethatthedenitionofpeermaychangeaccordingtothepracticeyouwanttobenchmark.

3. Compareyourownbusinessperformanceagainsttheanalysisofthepeercompanies.

4. Initiateactionstoclosethegapswhereyouidentifyyourperformancelagsbehindyourpeers.

Benchmarkingtravelprogramsbetweendifferentcorporationshasalongandcomplicatedhistory.Whileformalandinformalsharingofbestpracticeforprocessiswidelyrecognizedasextremelyvaluable,feelingsaremoremixedaboutdata.Withsomanyvariables,cancomparisonseverbemeaningful?

TheskepticismcouldarguablybeevengreaterforbenchmarkingofstrategicKPIs.Thiscreatesadoublebarrierofpotentialincompatibility:differentstrategicaimsanddifferenttravelprogramcongurations.Ontheotherhand,someofthestrategicKPIsmayprovideabasisforhelpingyouselecttherightpeergroupandmakebenchmarkingmoremeaningful.

AdvitobelievesbenchmarkingstrategicKPIswouldbeextremelybenecialforcompanieswithmaturetravelprograms.Ofcourseeachcompanyhasadifferentstructureandstrategicpriorities.However,the

purposeofstrategicKPIsisnottoproduceabsoluteguresbutanindexorarangeagainstwhichtomakecomparisons.Thisisnotjusttrueforcompaniescomparingthemselveswithothercompanies,butalsowithinorganizationsbusinessunitagainstbusinessunit,forexample.

Turning a vicious circle in a virtuous oneOnereasoncompanieshavenotbenchmarkedstrategicKPIsisthattherearestillnotmanywhichtrackthem.Butthisisaviciouscircle:onereasonnotmanycompanieshavestartedproducingstrategicKPIsisthattheyhavefewrolemodelstocopy.

Wehopethiswhitepaperwillactasacatalysttoconvertthatvicious

circleintoavirtuousone.Ideally,itwillencouragemorecompaniestocreatestrategicKPIsandtheywillprovetherolemodelforstillmoretojoininwiththem.

Therearenohardandfastruleshere,butthestartingpointcouldbesomeofthestrategicKPIsoutlinedinSection1,namely:

Travelmanagementservicescoverage Virtualmeetingindex Valueofmanagedtravel Travelexpenseproductivity Travelintensity Policycompliance Changeintotaltravelcost Climateimpactofbusinesstraveltransportreduction Shareofcorporatecreditcardvolume Travelagencyperformanceindex

(Seepage4foradenitionofeachofthesestrategicKPIs.)

final word | the role of benchmarking instrategic performance management


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ConclusionBenchmarkingisperhapsthelastlinkinachainwhichrunsthroughoutthiswhitepaper.Itaddsyetanotherlayerofcontexttodataand

remindsusthatgooddataisallaboutachievingdeeper,actionableinsightintohowacompanyisrun.

StrategictravelKPIsareimportantforpreciselythisreason.Traveldoesnotexistinitsownbubble.Itisavitalfunctionwhichensuresacompanyconstantlyrenewsitself,whetherintermsofseekingnewmarketsandcustomersordevelopingnewproducts.Atthesametime,thecostsgeneratedbytravelaffectprotabilitysignicantlyandthereforeitisimportanttondaccuratewaysofmeasuringthosecostsandmonitorhowsuccessfullytheyarebeingcontained.

Theprioritizationofcostcontainmentwhichcharacterizescorporations

indevelopedmarketsmeanssavingsKPIsareperhapsthefrontlineofstrategictravelKPIs.However,theyarenottheonlyimportantstrategicnancialindicator.ThetravelexpenseproductivityKPI,forexample,cangaugewhethertheleveloftravelexpenditureisappropriateforacompanysrevenues.

Widerstill,nocompanycanmeasureitprogresspurelyinnancialterms.Issueslikesustainabilityanddutyofcarearealsoattheforefrontofboardroomagendas,asiscompliance.EachoftheseissuesaffectstravelandtherearestrategicKPIstomeasureallofthem.

Itisworthrepeatingthecautionarynotethateffectiveperformancemanagementrequiresahighdegreeofstakeholderparticipationduringthedesignphase.Italsoneedstobefullyalignedwiththeperformancemanagementframeworkandterminologyusedinthecorporationandlinkdirectlytothecompanysspecicgoalprioritization.Assuchthiswhitepapercanprovideaframeworkandsomefoodforthoughtbutshouldnotbeseenasablueprintthatcanbeappliedidenticallyforeveryorganization.

Thatsaid,AdvitormlybelievesthatstrategictravelKPIsarethegluewhichjoinatravelprogramtothecorefunctionsofthecompanythat

theprogramserves.Theyensuretheprogramremainsrelevantandappreciatedbyseniormanagement.Theyalsoprovideapermanentlyevolvingagendaforaction,allowingtravelmanagerstomaintainoptimumperformancemanagementoftheirtravelprograms.AcknowledgementsAdvitowouldliketothankthefollowingforthesignicantcontributionstheymadetothiswhitepaper:

ScottGillespie;BrendaMiller,Nestl;JamesWestgarth,EADS;Association of Corporate Travel Executives

final word | the role of benchmarking instrategic performance management

Costs generated by travel aect

proftability signifcantly and thereore

it is important to fnd accurate ways omeasuring those costs and monitor how

successully they are being contained


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| F b i b d i ll i h d

BacktoIndex>

About AdvitoAdvito provides travel-management advisory, procurement and outsourcing services that guide clients through a complex travel environment. Advitosocus on consulting delivers proven value, unbiased counsel and a customized approach or every client and every engagement, together with industry

expertise and access to data to drive quantifable decision-making. Advito is headquartered in Atlanta and London and operates in key businessmarkets around the world. Advito is an independent operating unit o BCD Travel, the worlds third-largest travel-management company, owned byBCD Holdings N.V.About BCD Holdings N.V.BCD Holdings N.V., a Dutch amily-owned company ounded in 1 975 by John Fentener van Vlissingen, is a market leader in the travel industry. TheBCD Holdings companies are BCD Travel (global corporate travel management), Park N Fly (o-airport parking), TRX (travel transaction processingand data integration), Airtrade (consolidating and online travel), VakantieXperts (leisure), Vayama (online travel USA) and Parkmobile International(mobile parking and trafc applications). BCD Holdings employs approximately 13,000 people and operates in more than 90 countries with total sales,including ranchising, o U.S.$ 14.8 billion. For more inormation, visit: www.bcd-nv.com.

For more information please contact

Six Concourse Parkway NE,

Suite 2400,

Atlanta, GA 30328

www.advito.com

[email protected]
http://www.bcd-nv.com/http://www.advito.com/mailto:[email protected]:[email protected]://www.advito.com/http://www.bcd-nv.com/

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