Jo-Achim Hamburger, corporate travel manager for AB Electrolux, told the ACTE Forum in Berlin that every day there were 8,500 of his colleagues travelling somewhere in the world.
“They make their own decisions. They all know more than us. They all know how to book cheaper flights than us but they don't know the implications,” he told the delegates.
Mr Hamburger's remarks were light hearted but there was an element of truth in them, both in the way every traveller believes he knows better than the travel manager and the disregard of the consequences.
New research out suggests that Electrolux is not alone in having an abundance of would be travel managers
The European Spend Agenda 2005* reveals that pressure on procurement departments from the chief financial officer and the board to cut costs is growing. More and more procurement officers are expected to report direct to the board which in turn is demanding that up to 13% to be chopped off its overall spend, a massive task.
It is little wonder that procurement officers are moving increasingly into an area which has previously not been under their control, where spending has in many companies lacked “visibility” and where there is a high number of “maverick” spenders – travel.
Mr Steve Muddiman, Ariba's vp marketing EMEA, said: “The number of maverick spenders – individuals who do their own spending – is 40% higher in indirect areas of spend and the area which has the highest number of mavericks is in the spend on services of which travel is the biggest item.”
“But procurement officers know that savings can be 10% higher in this area as a result of policing a contract.”
To rub the point home, the European Spend Agenda 2005 which questioned 227 European companies, mainly from manufacturing and finance and most with an annual turnover of €1bn, found than more than a half of the procurement departments had “minimal” control over spend on business travel.
This means that these companies either had a travel manager who had managed to ward off the attentions of procurement or there was no firm and enforced travel policy in place and backed up with airline and hotel contracts. If the latter, it is likely to be wasting considerable sums each year.
The survey suggests this may be the case with some very large companies and they must therefore be losing heavily because of it.
Getting that control, Mr Muddiman said, is not easy. It is not just that some travel managers resent the arrival of the procurement people who allegedly see buying travel as akin to buying stationery or office chairs.
More it is a clash of culture and a realisation by procurement that buying travel is different from most other purchases – exactly as agents and travel managers have been saying for years. Again more than 50% of the procurement departments questioned said that managing a business travel contract was more difficult that other types of contract.
“There are all sorts of sub-categories of travel and before you can focus on savings, you need to know where you are spending.
“This is not a technology issue but a management process issue. The principle here is about culture. What we have here is an evolution of the procurement function as well as increasing the visibility of their role,” he said.
Travel was not an area where procurement can mandate and police as it can in other areas but it can work with the travel experts.
Mr Hamburger in his passionate defence of the role of travel managers saw a future where such highly qualified people, far from coming obsolete, played a prominent role in travel management.
Mr Muddiman sees something similar. “I don't think you will see the demise of travel managers but their role will evolve.
“You will see specialities appear, people who become expert in certain types of travel, like airlines, hotels, car rentals, expense management. We call them category experts and only when they understand their category will they start delivering savings back to their company.”
*The European Spend Agenda 2005 is compiled by Ariba, a company which helps corporate develop their spend management, the London School of Economics and the European School and Management and Technology in Berlin.