In my current assignment I have the privilege to work for a large multi-national company. In this article I will go through our journey over the last six months after we decided to outsource the travel function, and the reasons why.
Early this year the company decided to outsource the meet and travel function and buy those services from an external company — for at least the coming two years. The company, with presence in about 30 markets and a somewhat semi mature meet and travel programme, did a large company reorganisation where one part of the company was left without a global meet and travel function. The "other" part of the company was served with meet and travel services throughout a transitional time period, with the existing resources of both an internal team and some consultants.
The challenge was to implement a global meet and travel function reasonably quickly after the transition period ended. It needed to manage meet and travel and at the same time improve the programme through managing 14 improvement projects which closed the gap and used industry best practice.
Prior to implementation, the company and I created a meet and travel strategy.
Scope of the projects
The areas below, all in order to set up a "world class meet and travel function" to manage and improve the current travel programme.
- Implementing TMCs
- Air and hotel programmes
- Setting up data consolidation
- Manage meetings area
- Payments
- Savings programme
- Setting up the meet and travel function
- Analyse and implement new technology
- Best practices
- Implement new services
- Risk
- Implement online booking tools
Here are some of the reasons why it was best to outsource the process.
Time
The new global travel team consists of these persons.
- Global owner of programme (client role)
- Outsourced team
- Programme lead
- Four regional travel managers
- One traveller services manager
- One business analyst
The new team's challenge was to quickly get up to speed and manage all operational aspects of the programme. This included serving travellers with support, managing complaints/escalations, managing the supply base and all communication towards the travel community. At the same time we had to work strategically and improve the programme, most of them as a lead function and some as a support function, but always as "a driver".
It is almost mission impossible to hire seven resources that are fully competent in the meet and travel area and "ready to go" within a couple of months in order to start up the above in a quick manner.
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Internal and external team members bring different things to the table ©Weekend Images/iStockCosts
An assessment of the previous set up was made, along with the cost of managing the meet and travel programme, including the cost and resources from the other company that provided the transitional services.
The cost of outsourcing meet and travel was lower than the previous set up in apple to apple comparisons which was not, or rather did not, become the facts in this case. Why is that? Well, the new travel team was to assume the same responsibilities as the previous set up, but then some more as well.
The new outsourced team would improve the existing programme through running the already-mentioned projects and at the same time assume some local responsibilities into the team. This is mainly managing travel in the larger markets, ie the global team would assume global, regional and some local responsibilities. The total cost became lower and value deliveries/efficiencies increased.
Competence
I have worked within this industry for a long time; mainly on the buying side but also on the supply side. I know that it is extremely difficult to find skilled resources (why is that by the way?), preferably with a background from both sides. Normally you tend to find people with either/or, but in order to have a holistic picture on how to manage a programme efficiently and in partnership with your supply base, these backgrounds were preferred.
The only way to find highly skilled travel professionals efficiently and in short amount of time was to send out an RFP and get the resources from an external party. We sent the RFP mainly to the advisory functions of the larger global TMCs.
Flexibility
We (as in the company and the outsourced team) are not sure what the optimal set-up in the two-year time frame will look like; that is when the programme has "settled" and we have implemented best practices. It might be that we only need four or five resources, rather than seven.
Also, within the next two years the programme will run with full speed, but the need for different skill set will come and go throughout. The most efficient way to manage this is through an outsourced set-up. Of course with a thought to the outsourcing contract containing KPIS etc, but also having the flexibility to expand or decrease as a team during the initial two years.
There are some other reasons why the company chose to outsource, such as getting access to benchmarks and access to technology etc.
In this case a company reorganisation led to the opportunity to outsource the meet and travel function; but since it is both more efficient and less costly — maybe you should considering outsourcing yours?
How is the programme going?
The programme is going pretty much 100% according to plan and we are delivering strategic value. For example, there has been an update of the policy, increased savings and both an increased and better service/support to the traveller community, while at the same time successfully running the operational part of the programme.
There have been hiccups but those have been manageable and are mainly in the areas of sorting the outsourcing contract in time and getting all the necessary administrative parts in place — such as access to all relevant internal systems at the client side.
As for the programme itself: I have run many travel programmes but this one is a meet and travel programme, with a large focus on the service and support part towards the traveller community. This is more so than your "normal" saving/corporate targets, which is very interesting indeed.