When HRG took over travel management for the UK Ministry of Defence, it was charged with making savings on the £100m annual spend. Chris Fry, the TMC's commercial director, tells ABTN how they got on.
It was more than two years ago that Hogg Robinson Group (HRG) tendered for the travel management contract for the UK Ministry of Defence (MoD). Many would have wondered why.
The MoD had and still largely has an unenviable record of slapdash purchasing which seems to cost the UK taxpayers many millions more than it should have done.
The record of British departments of state in handling travel also leaves a lot to be desired. A report out earlier this year spoke warmly of the government's strategy on travel management as operating in a "policy vacuum with a lack of leadership and management." A polite way of describing chaos.
When it won the contract with the MoD, HRG was faced with a massive challenge to bring a creaking, outdated approach to travel into the modern age. As an example, servicemen and women on leave could queue for hours to sign the usual forms in triplicate to get a rail warrant to go home.
Rail warrants have been in use since at least World War One and are not terribly streamlined. But they were typical of the way that UK government departments conducted their travel business.
But what attracted HRG to the Mod business was its RFP. Not only was it a net spread wide engaging with all possible agencies, Chris Fry, Hogg's commercial director recalls, but it also indicated the department wanted to change. The MoD man Hogg was dealing with was Mike Homes who was "totally open for change," said Mr Fry
"It was quite clear they wanted to change. It was a huge, multi-dimensional programme they had in mind. There was a lot of discussions with them and we identified their objectives early on."
For example, they wanted to move on from the rail warrant and this was just one area where Hogg could help them save money, both on the cost of tickets and the cost of process. On hotels there seemed to be problems collecting information on bookings and not too much compliance. It was, Hogg realised, not a travel policy that had moved with the times.
The TMC knew it could save the ministry money but that was not the problem. There was just so much change that was needed in the MoD's approach that the real challenge was whether Hogg could achieve it in the allotted time.
"There were people saying that we were trying to tackle too much. It was a huge task and people were saying ‘We never thought you would do it'," Mr Fry said
Hogg's first move on winning the contract was to set up a three man team headed by Terry Grainger, one of its senior travel consultants. "It was very important to put in someone who was senior. It became his full time job. He was effectively the travel manager for the Ministry of Defence," Mr Fry said.
The ministry's travel programme was outsourced to Mr Grainger and his team who became its managed travel partner.
At the same time as Hogg took the reins, Cap Gemini was appointed to deliver a technical platform which could handle the new processes Hogg was urging the MoD to adopt.
One of Hogg's principal aims in streamlining the department's process was to move a lot of the business online. But even here there were problems because, in the nature of the MoD's business, not everyone has access to a laptop.
There was also the need, Mr Fry said, to "spot the opportunities to get the armed forces to back the new programme." This was helped he said by the fact that the changes were being driven "from the top down."
It boiled down to getting the MoD to adopt the "best practices you would expect in a corporate programme. But because of the opportunities for change, the figures were huge," he said. "You can imagine that to drive change, you had to be robust in how the new processes would work. But the more success we got, the more the momentum of our programme increased."
Hogg was charged with knocking about a quarter off the ministry's £100m budget - a massive figure. But against the expectations of some, this was achieved. The success led the Defence Travel Management Organisation to receive a commendation from the Chief of Defence Materiel, Sir Kevin O'Donoghue last month.
The citation referred to the organisation's "role in delivering significant financial benefits across MoD." It was the second time the travel management programme had been recognised, the first time for achieving the objectives laid out in its RFP.
Hogg has now moved into its second year as the MoD's travel partner and is still finding ways to cut spending. One area being worked on is the deals with suppliers. "We feel we are making continuous progress now. But we shall continue to keep or foot on the accelerator," Mr Fry said.
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