the end and future of managed travel
DESCRIPTION
After 20 years of professional management, the corporate travel category has reached the point of diminishing returns. It needs to explore new frontiers, ones that use new technologies and new principles. This deck describes those new frontiers.TRANSCRIPT
The End and Future of Managed Travel Scott Gillespie Gillespie’s Guide to Travel+Procurement
• Managed Travel 1.0
• Winds of Change
• The Optimization Problem
• It’s Time for a New Approach
• New Frontiers
• Discuss and Debate
Where we’re headed
• 1994: Delta caps commissions, triggers TMC transaction fees and cost center mentality
• Late 90’s: Corporate online booking tools put travel policies in spotlight
• 2007: UK’s Corporate Manslaughter Act makes duty of care a high priority
Strategic drivers of MT 1.0
MT 1.0 has diminishing returns
Gillespie’s Guide to Travel+Procurement
Countries
T&E Spend $$$
$
20% of Global T&E Spend
Worth going after?
Gillespie’s Guide to Travel+Procurement
Airlines
Air Spend $$$
$
20% of Air Spend
Worth going after?
MT 1.0 has diminishing returns
Gillespie’s Guide to Travel+Procurement
$$$
$
20% of Spend
Worth going after?
Spend
City pairs, or hotels, or travelers, or trips
MT 1.0 has diminishing returns
Consolidate TMCs Consolidate T&E card programs Consolidate travel data and reporting Comply with duty of care Use KPIs and benchmarking 80+ % online adoption 90+ % travel policy compliance Optimize air, hotel and car programs
After 20 years, best practices for MT 1.0 are well known
Trip costs have been mastered
Gillespie’s Guide to Travel+Procurement
The castles have been built
Travel Policy None Harsh
High
Costs
Trip Cost
Solid, safe, enduring – a valuable base
Immobile, inflexible
not
Castles
Ships We need
Where are the new frontiers?
Global networks create greater competition for good talent
iPhone culture impacts more than Gen Y
User experience drives brand loyalty, especially in travel
Travel suppliers have stronger, more insightful pricing and packaging power
Greater emphasis on traveler well-being
Winds of Change
The optimization problem
Travel Policy None Harsh
High
Costs
Trip Cost
• Lost productivity • Reluctance to travel • Recruiting, retention problems
Total Trip Cost
Traveler Friction
The optimization problem
Travel Policy None Harsh
High
Costs
Trip Cost
Total Trip Cost
Traveler Friction
The Great Unknown
To date…
Best practices are well known Mature programs deliver diminishing returns New forces are at work Half of the travel optimization problem is not well understood
it’s time
new approach
for a
Where are the new frontiers?
Brand.com to CDE is a new frontier
Brand.com
Corporate Traveler
Corporate Booking
Data Traveler’s Expense Report
Net of Discounts
“B2CDE”
Edit Rights are a new frontier
Corporate Traveler
Brand.com
Corporate Booking
Data
Corporate TMC
Right to edit or cancel the booking
Everybody is happy!
Trip Changes
Net of Discounts
Managed Travel 2.0 is a new frontier
1. Shop anywhere – period.
2. Book anywhere – so long as data is captured quickly
3. Book anybody – so long as suppliers are safe
4. Book anything – so long as it is in budget
22
Traveler Dashboards are a new frontier
Door to door
Trip Tailoring is a new frontier
Detailed Expense Estimate
Detailed Trip Itinerary Door to door
2 3-4 5-8 9-16 17-32 33-64 65+ 1
22% of trips taken by infrequent travelers
Who needs Trip Tailoring?
Source: Scott Gillespie’s analysis of an anonymous data set
Travel Budget Owners are a new frontier
Trip Cost
Traveler Friction
Good trips results
Within my budget
Traveler Friction is a new frontier
Travel Policy None Harsh
High
Costs
Trip Cost
Traveler Friction
• Frustration, Stress • Safety, security • Lost productivity • Reluctance to travel • Recruiting, retention problems
Traveler Friction None High
Sales
High
Effective Range
Traveler Friction’s Impact on Sales
Traveler Friction None High
High
Employee Attrition
Traveler Friction’s Impact on Attrition
Acceptable Range
Traveler Friction None High
Traveler Friction’s Ideal Range
HR’s Input
Sales Input
Traveler Friction None High
Traveler Friction’s Optimal Range for Sales People
Optimal Range
35 pts 55 pts
Better Management of Salespeople Bowden, Christina 84
Barton, Elsie 82
Goldstein, Gretchen 78
Watts, Tim 77
Merritt, Shirley 77
Dougherty, Kristine 66
Steele, Eric 60
May, Alex 55
Jones, William 50
Bender, Hazel 48
Chung, Donald 43
Underwood, Harvey 41
Teague, Wesley 35
Hamilton, Elsie 29
Walsh, Marcia 25
Vick, Franklin 20
Encourage more travel
Reduce travel friction: - fewer trips? - better trips via policy exceptions?
Trip Cost
The Future
Traveler Friction
The Past
Implications of Change
Gillespie’s Guide to Travel+Procurement
For Travel Managers
Trip costs Business impact
For Travel Suppliers
Travel buyers Travelers and budget owners
As you make the transition
Embrace the journey
Share your discoveries!
Thank you! Scott Gil lespie
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