The End and Future of Managed Travel Scott Gillespie Gillespie’s Guide to Travel+Procurement

• Managed Travel 1.0

• Winds of Change

• The Optimization Problem

• It’s Time for a New Approach

• New Frontiers

• Discuss and Debate

Where we’re headed

• 1994: Delta caps commissions, triggers TMC transaction fees and cost center mentality

• Late 90’s: Corporate online booking tools put travel policies in spotlight

• 2007: UK’s Corporate Manslaughter Act makes duty of care a high priority

Strategic drivers of MT 1.0

MT 1.0 has diminishing returns

Gillespie’s Guide to Travel+Procurement

Countries

T&E Spend $$$

$

20% of Global T&E Spend

Worth going after?

Gillespie’s Guide to Travel+Procurement

Airlines

Air Spend $$$

$

20% of Air Spend

Worth going after?

MT 1.0 has diminishing returns

Gillespie’s Guide to Travel+Procurement

$$$

$

20% of Spend

Worth going after?

Spend

City pairs, or hotels, or travelers, or trips

MT 1.0 has diminishing returns

Consolidate TMCs Consolidate T&E card programs Consolidate travel data and reporting Comply with duty of care Use KPIs and benchmarking 80+ % online adoption 90+ % travel policy compliance Optimize air, hotel and car programs

After 20 years, best practices for MT 1.0 are well known

Trip costs have been mastered

Gillespie’s Guide to Travel+Procurement

The castles have been built

Travel Policy None Harsh

High

Costs

Trip Cost

Solid, safe, enduring – a valuable base

Immobile, inflexible

not

Castles

Ships We need

Where are the new frontiers?

Global networks create greater competition for good talent

iPhone culture impacts more than Gen Y

User experience drives brand loyalty, especially in travel

Travel suppliers have stronger, more insightful pricing and packaging power

Greater emphasis on traveler well-being

Winds of Change

The optimization problem

Travel Policy None Harsh

High

Costs

Trip Cost

• Lost productivity • Reluctance to travel • Recruiting, retention problems

Total Trip Cost

Traveler Friction

The optimization problem

Travel Policy None Harsh

High

Costs

Trip Cost

Total Trip Cost

Traveler Friction

The Great Unknown

To date…

Best practices are well known Mature programs deliver diminishing returns New forces are at work Half of the travel optimization problem is not well understood

it’s time

new approach

for a

Where are the new frontiers?

Brand.com to CDE is a new frontier

Brand.com

Corporate Traveler

Corporate Booking

Data Traveler’s Expense Report

Net of Discounts

“B2CDE”

Edit Rights are a new frontier

Corporate Traveler

Brand.com

Corporate Booking

Data

Corporate TMC

Right to edit or cancel the booking

Everybody is happy!

Trip Changes

Net of Discounts

Managed Travel 2.0 is a new frontier

1. Shop anywhere – period.

2. Book anywhere – so long as data is captured quickly

3. Book anybody – so long as suppliers are safe

4. Book anything – so long as it is in budget

22

Traveler Dashboards are a new frontier

Door to door

Trip Tailoring is a new frontier

Detailed Expense Estimate

Detailed Trip Itinerary Door to door

2 3-4 5-8 9-16 17-32 33-64 65+ 1

22% of trips taken by infrequent travelers

Who needs Trip Tailoring?

Source: Scott Gillespie’s analysis of an anonymous data set

Travel Budget Owners are a new frontier

Trip Cost

Traveler Friction

Good trips results

Within my budget

Traveler Friction is a new frontier

Travel Policy None Harsh

High

Costs

Trip Cost

Traveler Friction

• Frustration, Stress • Safety, security • Lost productivity • Reluctance to travel • Recruiting, retention problems

Traveler Friction None High

Sales

High

Effective Range

Traveler Friction’s Impact on Sales

Traveler Friction None High

High

Employee Attrition

Traveler Friction’s Impact on Attrition

Acceptable Range

Traveler Friction None High

Traveler Friction’s Ideal Range

HR’s Input

Sales Input

Traveler Friction None High

Traveler Friction’s Optimal Range for Sales People

Optimal Range

35 pts 55 pts

Better Management of Salespeople Bowden, Christina 84

Barton, Elsie 82

Goldstein, Gretchen 78

Watts, Tim 77

Merritt, Shirley 77

Dougherty, Kristine 66

Steele, Eric 60

May, Alex 55

Jones, William 50

Bender, Hazel 48

Chung, Donald 43

Underwood, Harvey 41

Teague, Wesley 35

Hamilton, Elsie 29

Walsh, Marcia 25

Vick, Franklin 20

Encourage more travel

Reduce travel friction: - fewer trips? - better trips via policy exceptions?

Trip Cost

The Future

Traveler Friction

The Past

Implications of Change

Gillespie’s Guide to Travel+Procurement

For Travel Managers

Trip costs Business impact

For Travel Suppliers

Travel buyers Travelers and budget owners

As you make the transition

Embrace the journey

Share your discoveries!

Thank you! Scott Gil lespie

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