Global travel policies can save corporates a lot of money. According to a study by IT company Amadeus and the Association of Corporate Travel Executives (ACTE), 4% of corporates can save more than 45%, 11% between 30-45% while the bulk, 73%, up to 30%.
Obviously it is the multi-nationals which are best placed to adopt and get the most benefit from a global travel programme. But the paper Global Travel Programmes Come of Age suggests that there are trends and patterns emerging which point the way to a successful adoption of such a strategy for all companies.
The survey found that companies with a global travel programme tend to have adopted a three-tier strategy of travel management: headquarters, regional centres and localities. A.T. Kearney, the global consulting company, does exactly this with each level having a defined role.
For example, head office defines strategy, analyses data, manages all contract negotiations, analyses all spend and performance and handles all supplier relationships.
The regional centres are the link between the head office and the localities and liaise with regional suppliers. The localities deal with local suppliers and oversee delivery.
44% of corporates with a global policy structured them this way with just 28.6% doing it on a global basis only.
All of the 240 travel managers who responded to the Amadeus/ACTE questionnaire said their focus was on consolidation of suppliers which included their TMC, corporate card provider and airline. They were also integrating IT processes which included the use of one online self-booking tool and to a lesser extent, automated expense management.
Equally important to a global strategy was a global policy. This required consistency in booking, how travel was paid for, which suppliers were sued and in what conditions.
It was here that some companies regulated their travellers with 12.3% imposing a "very strong" mandate. But by far the most, 56.6% had adopted a policy of "firm direction."
The "very strong" policy was usually found in the US with European companies aiming to "sell" their travel policy than mandating it, the study said.
But moving on from putting the structure in place to achieving savings was where the challenges arose. The biggest hurdles to clear were integrating technology and getting global data.
The first involves implementing automated processes like online booking, the use of e-tickets, and online expense reporting. 85% of the study's respondent cited integrating technology as a "significant challenge."
An online booking tool is seen as a major part of any global travel programme. In companies where it is most used, the savings on the average price of an airline ticket are 12-15% with transaction costs halved.
But while 80% of US travel managers who responded said they used a self booking tool, the figure for Europe was 59%.
However online booking levels in Europe are increasing sharply with the market for 2006 estimated at $7.3bn, a rise of 66% on 2005.
But savings can also be made in adopting a single process.
Keith Mullineaux, General Electric's regional travel manager EMEA, told the survey that moving to one process and to a single European operation took four years. But this is now reaping substantial benefits, including a 33% saving on "operational handling costs."
One of the gaps in integrating technology seems to be in a single expense management system with only 18% of respondents saying that they had one in all regions.
The second key challenge, highlighted by 77% of the respondents, is collecting and analysing comprehensive data. In Europe, 81% said it was their "most pressing concern."
The study described data as the "cornerstone of a global travel programme." Companies, despite the "steep costs", were using third party aggregators to collect and standardise data for them.
Suppliers and card providers were both working to provide more and better data for their clients.
But there are regional differences which make this difficult. Northern Europe uses automated processes but Southern Europe tends to use a travel agent.
In Russia, the survey found that the lack of bank settlement plan facilities for airline tickets meant these were done manually.
In China, regulations on the use of the national GDS and the need to use local card providers were a problem.
But while adopting a global travel programme is a slow and difficult process, the rewards are substantial. Perhaps surprisingly, most respondents (87%) said cited the improved ability to tack travellers for security reasons as the greatest benefit.
But increased negotiating clout was cited as the second most important benefit by 86%. Reduced costs came, again surprisingly, third cited by 84%. Last were improved efficiency (82%) and improved service (80%.)
* see BTE's recruitment site www.businesstraveljobs.com