September 29 2022, Kimpton Fitzroy London
Friday 30 September 2022, JW Marriott Grosvenor
21 November 2022, Hilton London Metropole
THIS IS GETTING SPOOKY. Every time I sit down to write this column, a shock-horror revelation about corporate-card abuse appears in that morning’s national press, and I feel compelled to bin what I was planning to say because I can’t let the story pass without comment.
Last time, I discussed a front-page headline in The Daily Telegraph that screamed: “MoD spends £1 billion on staff credit cards”. I’ve spent a lot of time in recent years studying corporate cards and I am convinced they help organisations gain better control over their spend – not, as the Telegraph article implied, weaken it. Having said that, the newspaper story which made my muesli go down the wrong way today has given even me pause for thought: a Metropolitan Police inquiry into its 3,500 officers who had American Express cards found that no fewer than 1,019 used their plastic outside policy, leading to £3.7 million of unreconciled spend. Even more scarily, six officers were convicted in criminal courts and a further 34 faced misconduct actions, including dismissal.
So does this mean a corporate card helps employees to cheat on expenses after all? I suppose the answer is both yes and no: yes if you introduce a card but don’t manage an expense policy and programme around it; and no if you do manage the programme properly. I have read the summary of the Met Police report by the Independent Police Complaints Commission, which oversaw the investigation. It says the Met has subsequently “instigated a new corporate card system and revised its expenses policy to prevent any reoccurrence... There are fewer authorised card holders, stricter regulations around timing of reconciliation on accounts and increased accountability.”
That’s all well and good, but another sentence in the report’s conclusion is even more telling. “The main issue highlighted by the review,” it reads, “was not about poor policies, but a lack of adherence to them.”
Put another way, there is no point in simply possessing data from a corporate card or, indeed, any other source. You actually have to look at it occasionally and find out what is going on in your organisation. What is more, once you figure out what the numbers are telling you, you have to take action to put the situation right. The Metropolitan Police card fiasco is an extreme example, but I have seen many other cases over the years of companies failing to work the data at their fingertips.
ANOTHER HEADLINE I SAW recently also had a lesson about data analysis for travel managers. “Singing Trainline advert out of tune, rules ASA”, trumpeted the headline on Buying Business Travel’s sister website, ABTN.co.uk
My immediate assumption was that the Advertising Standards Authority (ASA) had banned Thetrainline’s ad for unforgivably featuring the band Black Lace, perpetrators of the 1980s hit single ‘Agadoo’. In fact, the authority ordered one particular version of the ad to be pulled for a completely different reason. It upheld a complaint that a claim Thetrainline users could “save 43 per cent on average” was misleading. The ASA said viewers might think Thetrainline was claiming to be 43 per cent cheaper than other distribution channels for the same ticket type. In fact, the saving of 43 per cent could only be substantiated in the case of buying an advance fare instead of a non-advance fare.
This story caught my eye because one of the biggest challenges travel buyers face is meaningfully measuring how much their travel management company (TMC) or other intermediary is saving them. Similarly, buyers have to find an appropriate yardstick to tell senior management how much less their business is paying for travel as a result of running a managed travel programme.
It used to be much easier: the average air fare paid by the company was benchmarked against the full published fare on the same route. Using this comparison, savings could regularly be recorded in the region of 30 or 40 per cent and it would be off to the wine bar for trebles all round.
However, that won’t wash any longer, for various reasons, including the fact that almost no-one pays full fare today and procurement and finance chiefs are a bit wiser.
Another option is to compare what you paid this year with what you paid last year, but that does not reflect market changes. What is badly needed is context, and that is why some buyers are now trying to evaluate their price fluctuations against a market index or by benchmarking with sector peers. It is no perfect science – not yet anyway – but I think travel managers and their intermediaries will do much more work on this in the next year or so.
WHILE I AM MAKING predictions about data management, here’s another one: I reckon we are going to see a lot more attention paid to aggregating management information from different data sources. My reasons for thinking this include the possibility of reduced airline distribution through global distribution systems and the increasingly autonomous behaviour of corporate travellers, who want to manage and even book travel through independent channels.
Data from all those different sources will need to be recorded in a central repository, and I see signs of TMCs, card issuers and expense tool companies vying to be the provider of that repository. Really sticking my neck out, I think the latter are particularly well positioned to win that race, especially if they offer integrated expense management and online booking – but there’s a long way to go yet.
IF YOU’RE NOT YET CONVINCED that mobile poses a threat to managed travel programmes, I refer you to the new Eurostar app, allowing consumers to download a mobile ticket to their phones. I rang the Eurostar press office to check whether the company is making mobile ticketing available through TMCs. The answer? Not yet – which is a fantastic incentive to corporate travellers to avoid their employer’s official TMC and go direct to Eurostar instead.