Bob Papworth talks to Corrado Simontacchi, EMEA purchasing manager, goods and services, for Belgium-based chemicals company Huntsman
Huntsman’s approach to travel management has altered dramatically in recent years. What brought the changes about?
My responsibility is for all corporate indirect purchasing within the EMEA region, and my total budget is between US$80 million and US$90 million, with a global travel and entertainment spend of around US$65 million, which is close to the pre-recession levels of 2008.
In 2009, we reduced our total budget by 50 per cent. In travel terms, that meant cutting the budget by half, and cutting the number trips by half.
Then, in the second half of that year, we relaxed the rules a little – the budgets were still 50 per cent lower, but we allowed more trips. More trips with no more money meant a move to ‘smart’ travel.
So how does the concept of ‘smart travel’ work?
Travel is a commodity like any other and to get the best possible deal, you have to shop around. We explain to our people why certain suppliers are preferred, but at the end of the day the choice sits with them.
Our first concern is the safety and security of all our travellers, followed by the lowest logical fare and cost containment. There is pressure on budget at a cost-centre level, but the role of anyone providing a travel service is to help travellers, not to hinder them. We keep the pressure on everyone to learn to travel smarter.
How can you possibly mandate that?
We do have a global travel policy, which is mandated – at least on paper. We don’t enforce policy to the extent where, when you book, I tell you how to travel. We do check compliance, but that comes down to budgets. If it is within budget, then it is probably OK.
At the end of the day, I am a traveller myself, and I am one who hates having someone tell me what to do, so I know what it’s like. If you try to impose that on people, you might win the battle, but you won’t win the war.
Does Huntsman’s senior management buy into this liberal approach?
Of course. What this gives me is complete visibility – I have a complete picture of the cash savings, and that is a big help when I deal with the board. They can see that it is working. As I say, traveller safety and security will always come first, but cost containment is a big focus throughout our organisation.
What about the travellers themselves – how have they adapted to the new regime?
In a world where there isn’t 100 per cent transparency, you can’t rely on one service provider and, given my wider purchasing role, I simply don’t have enough time to deal with lots of different providers. I need someone else to do that on my behalf, and the travellers understand and appreciate the fact that they are empowered to find a balance between flexibility, comfort and cost.
Your background within Huntsman is very varied – purchasing, finance, marketing, strategic planning, customer service, even IT – how does travel management fit in?
Today, most of the time, if you need to manage a travel programme, you are effectively involved in change management. The travel industry is evolving all the time, so change is always happening. If you look at the differences in corporate cultures across Europe, the Middle East and Africa, for example, you have to be flexible – to change the way you approach [travel management].Within Huntsman, you have been involved with various IT projects. What are your views on travel technology?
We all talk about technology, which is fine, but frankly I still do not believe that technology is delivering at the right level. There is a lot more to be done, a lot more the providers could do.
You’re a board member of the Belgian Association of Travel Management, and attended the ACTE Global Education Conference in Barcelona in October. How do you rate such organisations?
I think they are very valuable, particularly for those who are not full-time travel managers and who have other responsibilities. For me ACTE provides a very good opportunity to understand what’s going on in the market and to share best practice.
If you could change one thing about travel management in today’s world, what would it be?
I would like to see more transparency from the industry. Things have improved, but there is still a kind of incestuous relationship within the supply chain, and that is not good for the industry as a whole.
If I had a magic wand, my first priority would be to gain greater clarity within the industry, to move to new-generation travel management, Travel 2.0. The battle between suppliers and purchasers, like the one between ‘travel’ and ‘procurement’, is still going on. I am lucky because [my background means] I am not looking at my role from a procurement point of view – my role is to help our travellers.
Huntsman is a global manufacturer of “differentiated chemicals”, encompassing a wide range of industries such as plastics, automotive, aviation, textiles, footwear, paints and coatings, construction, technology, agriculture, healthcare, detergents, personal care, furniture and chemicals.
The company is known for its innovations in packaging and integrated growth in petrochemicals, and has about 12,000 employees operating from a number of locations worldwide. In 2012, Huntsman had revenues of more than US$11 billion.