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US. Business travel spending has climbed to more than $ 143 billion in 1994, according to the latest survey by American Express in the management of business travel. Private sector employers spend about $ 2.484 per employee in travel and leisure, an increase of 17 percent over the past four years.
Business costs of T & E, now the third largest controllable expense behind sales and data processing costs, are under new control. Companies are realizing that even a savings of 1 or 2 percent can result added to your last dollar million.
Savings of this order are sure to get the attention of management, which is a requirement for this type of project. Participation begins with understanding and evaluation of the components of T & E management to control and monitor more effectively.
Management practice includes assigning responsibility for travel management, the implementation of a system to measure the quality of travel services, spare parts and write and distribute a formal travel policy. Only 64 percent of US companies have travel policies.
Even with the support of senior management, road savings they are only rock in three companies successfully established an internal program that will help reduce travel costs, travel and multiple aspects are so overwhelming, most companies do not know where to start. "The travel industry is based on the information," said Steven R. Schoen, founder and CEO of The Global Group Inc. "Until a passenger actually sets foot on the plan, which [only] buys information. "
If this is the case, the information technology seems a viable place to negotiate the elusive but coveted savings. "Technological innovations in the business travel industry enable companies to realize the full potential of automation to control and reduce [Travel] indirect costs," said Roger H. Ballou, president of the Group of States Travel Services UNite American Express. "In addition, many companies are embarking on quality programs that include improvement efforts and sophisticated reengineering designed to dramatically improve T & E management processes and reduce overhead."
While companies are turning to technology to make potential savings a reality can be very creative about the methods they employ.
The great leveler
GDS has long been the exclusive domain of travel agents and other industry professionals. But that all changed in November 1992 when a Department of Transportation ruling allowed the general public access to systems such as Apollo and SABRE. Management software TripPower trip and TravelNet immediately emerged, offering a glimpse of the companies where their dollars are spent T & E.
The software tracks spending trends by interacting with the company's database and access to centralized reservation systems that provide immediate booking information for airlines, hotels and car rental agencies. These programs also allow users to generate computerized travel reports on cost savings with details on where discounts were obtained, hotel and car use and travel patterns between cities. Actual data gives added leverage companies to negotiate discounts with travel suppliers.
"When you have information, you must return to a box each time you decide to change agencies," says Maria Savovie Stephens, travel manager for giant Chiron Corp. Biotechnology
Sybase Inc., a client / server leading provider of software with annual T & E budget of more than $ 15 million, according to. "Software gives us unprecedented visibility into how employees spend their travel money and better leverage to negotiate with travel service providers," said Robert Lerner, credit manager and travel services business for Sybase Inc. "We better access to data, faster, in a real time environment, which should provide significant savings in T & e. now we have control of our information to travel and not have to rely only agencies and airlines. "
The cost of this privilege depends on the turnover. Time purchase of travel management software can be run from under $ 100 to over $ 125,000. Some software vendors will adapt to small users through the sale of software parts for $ 5 to $ 12 per trip booked, yet substantial savings in standard of $ 50 per transaction industry.
No More entries
Paperless travel is catching on faster than the paperless office never did that service providers and consumers work together to reduce ticket prices for business travelers. Perhaps the most avant-garde developments is Travel "Ticketless" which almost all major airlines are testing.
Meanwhile, suppliers, and travel agencies are experimenting with new technologies to allow travelers to book travel services via the internet, email and ticket kiosks unattended. Best Western, Hyatt Hotels and several other major international market Internet channels. These services reduce the need for paper and provide better service and value devices such as increased efficiency, better tracking expenses and travel trends, and reducing costs.
Dennis Egolf, CFO of the Veterans Affairs Medical Center in Louisville, Ky., Has realized that the decentralized location of the medical center, a quarter mile from the hospital, the effectiveness is difficult, he realized. "We lost production time and things have been lost," he said. "Every note must be made for approval by hand and requires seven different copies of each order of the books." As a result, Egolf tried an off-the-shelf software to reduce the role of the federal government.
The software allows the hospital to manage travel online, monitoring daily allowances and costing to generate cash advance forms and authorizing reimbursement vouchers. The software also allows the hospital to keep a running count of their travel expenses and remaining travel budget.
"Today, for all practical purposes, the system is paperless," said Egolf. The software has helped the hospital reduce document processing time by 93 percent. "The initial goal oriented management without the employee's travel paper," he said. "We have achieved this goal, thanks in part to the efforts of staff and partly because of the accuracy of the software."
With an investment of only $ 6000, the hospital saved $ 70 each employee trip and saved almost half of its $ 200,000 T & E budget through the paper reduction program.
over there
The consolidation of business travel arrangements for a smaller number of agencies has been a rising trend since 1982. Nearly three out of four companies now make travel plans for their business through an agency compared to 51 percent in 1988. the two main benefits of consolidation of the agency are facilitating accounting and budget T & E, as well as leverage in negotiating discounts on future trips.
A major technological breakthrough that allows the consolidation of this trend to flourish is the introduction of satellite ticket printers (PTS). The use of STP allows a travel agency to consolidate all operations of a home office, and still send all necessary inputs in several places at once through various news agencies. As the term suggests, the machine prints airline tickets on site immediately, eliminating shipping costs.
For London Fog, STP is a blessing. Budget Annual T & E London fog over 15 million are divided equally between its two locations in Eldersburg, Md., And the city of New York. Each location buys the same number of entries, so that equal access to the ticket in your organization is a must. With PBS in two places, the company services both offices with an agency in Baltimore. Each office has access to immediate air and manages to save by not having to pay for mail and express courier fees that can range up to $ 15 for each of the more than 500 entries each annual purchases.
Quote from T & E Annual Conde Nast Publications' of more than $ 20 million is divided between its locations in Los Angeles, San Francisco, Chicago, New York and Detroit. Since 1994, travel arrangements were handled by an advanced travel management centralized agency in the city of New York, by installing an STP in each of these five areas. In addition to increasing the efficiency due to consolidation, Conde Nast now has the ability to change travel plans at any time and have new tickets in hand instantly.
The real benefit is that the machines are owned and managed by the travel agency., So there is no cost to the company. Because of the great expense involved, however, remain the only option for STP major ticket buyers. "STP is a viable option in this process to any place you buy more than $ 500,000 per year in the air," says Shoen.
As averages of airline tickets 43 percent of T & E expenses of any company, the savings that can be achieved through the various uses of technology have become dramatic. For example, the ability of companies to collect and analyze their own travel trends led to the creation of the net rate of negotiating a purchase price between a company and an airline to purchase tickets at no extra charge commissions, overrides, transaction costs, transaction costs and other agency cuts.
Although most US carriers publicly proclaim that they negotiate corporate discounts below market rates published, American Express survey on business travel management found that 38 percent of US companies had access to, or had already implemented reduction negotiated airfares. Availability and mechanics of these agreements vary widely by society.
What is the price?
Fred Swaffer, transport manager for Hewlett-Packard and a strong supporter of the net price system, launched the concept of fixing the fee-based with travel management companies contracted with HP prices. He says that HP, which spends more than $ 528 million annually in T & E plans to have all the net rate as a function of air travel pricing. "Currently, we have several net in stages according to the rates," he said. "These rates are negotiated with the airlines at the company, then reach each of our seven geographic regions."
Frank Kent, Western regional manager for United Airlines, agrees: .. "United Airlines is participating in a reduction in the volume of business, such as buying tickets in bulk, but prices net I have not seen a single net rate agreement that makes sense to us we are not opposed to it, but just do not understand right now. "
Kent points out, "Airlines should approach companies with long-term strategic relationship and not just discounts. We would like to see us with the company rather than just participate. "
As business travel expenses nose up, companies are realizing that improving cost management techniques can make a difference.
US. Business travel spending has climbed to more than $ 143 billion in 1994, according to the latest survey by American Express in the management of business travel. Private sector employers spend about $ 2.484 per employee in travel and leisure, an increase of 17 percent over the past four years.
Business costs of T & E, now the third largest controllable expense behind sales and data processing costs, are under new control. Companies are realizing that even a savings of 1 or 2 percent can result added to your last dollar million.
Savings of this order are sure to get the attention of management, which is a requirement for this type of project. Participation begins with understanding and evaluation of the components of T & E management to control and monitor more effectively.
Management practice includes assigning responsibility for travel management, the implementation of a system to measure the quality of travel services, spare parts and write and distribute a formal travel policy. Only 64 percent of US companies have travel policies.
Even with the support of senior management, road savings they are only rock in three companies successfully established an internal program that will help reduce travel costs, travel and multiple aspects are so overwhelming, most companies do not know where to start. "The travel industry is based on the information," said Steven R. Schoen, founder and CEO of The Global Group Inc. "Until a passenger actually sets foot on the plan, which [only] buys information. "
If this is the case, the information technology seems a viable place to negotiate the elusive but coveted savings. "Technological innovations in the business travel industry enable companies to realize the full potential of automation to control and reduce [Travel] indirect costs," said Roger H. Ballou, president of the Group of States Travel Services UNite American Express. "In addition, many companies are embarking on quality programs that include improvement efforts and sophisticated reengineering designed to dramatically improve T & E management processes and reduce overhead."
While companies are turning to technology to make potential savings a reality can be very creative about the methods they employ.
The great leveler
GDS has long been the exclusive domain of travel agents and other industry professionals. But that all changed in November 1992 when a Department of Transportation ruling allowed the general public access to systems such as Apollo and SABRE. Management software TripPower trip and TravelNet immediately emerged, offering a glimpse of the companies where their dollars are spent T & E.
The software tracks spending trends by interacting with the company's database and access to centralized reservation systems that provide immediate booking information for airlines, hotels and car rental agencies. These programs also allow users to generate computerized travel reports on cost savings with details on where discounts were obtained, hotel and car use and travel patterns between cities. Actual data gives added leverage companies to negotiate discounts with travel suppliers.
"When you have information, you must return to a box each time you decide to change agencies," says Maria Savovie Stephens, travel manager for giant Chiron Corp. Biotechnology
Sybase Inc., a client / server leading provider of software with annual T & E budget of more than $ 15 million, according to. "Software gives us unprecedented visibility into how employees spend their travel money and better leverage to negotiate with travel service providers," said Robert Lerner, credit manager and travel services business for Sybase Inc. "We better access to data, faster, in a real time environment, which should provide significant savings in T & e. now we have control of our information to travel and not have to rely only agencies and airlines. "
The cost of this privilege depends on the turnover. Time purchase of travel management software can be run from under $ 100 to over $ 125,000. Some software vendors will adapt to small users through the sale of software parts for $ 5 to $ 12 per trip booked, yet substantial savings in standard of $ 50 per transaction industry.
No More entries
Paperless travel is catching on faster than the paperless office never did that service providers and consumers work together to reduce ticket prices for business travelers. Perhaps the most avant-garde developments is Travel "Ticketless" which almost all major airlines are testing.
Meanwhile, suppliers, and travel agencies are experimenting with new technologies to allow travelers to book travel services via the internet, email and ticket kiosks unattended. Best Western, Hyatt Hotels and several other major international market Internet channels. These services reduce the need for paper and provide better service and value devices such as increased efficiency, better tracking expenses and travel trends, and reducing costs.
Dennis Egolf, CFO of the Veterans Affairs Medical Center in Louisville, Ky., Has realized that the decentralized location of the medical center, a quarter mile from the hospital, the effectiveness is difficult, he realized. "We lost production time and things have been lost," he said. "Every note must be made for approval by hand and requires seven different copies of each order of the books." As a result, Egolf tried an off-the-shelf software to reduce the role of the federal government.
The software allows the hospital to manage travel online, monitoring daily allowances and costing to generate cash advance forms and authorizing reimbursement vouchers. The software also allows the hospital to keep a running count of their travel expenses and remaining travel budget.
"Today, for all practical purposes, the system is paperless," said Egolf. The software has helped the hospital reduce document processing time by 93 percent. "The initial goal oriented management without the employee's travel paper," he said. "We have achieved this goal, thanks in part to the efforts of staff and partly because of the accuracy of the software."
With an investment of only $ 6000, the hospital saved $ 70 each employee trip and saved almost half of its $ 200,000 T & E budget through the paper reduction program.
over there
The consolidation of business travel arrangements for a smaller number of agencies has been a rising trend since 1982. Nearly three out of four companies now make travel plans for their business through an agency compared to 51 percent in 1988. the two main benefits of consolidation of the agency are facilitating accounting and budget T & E, as well as leverage in negotiating discounts on future trips.
A major technological breakthrough that allows the consolidation of this trend to flourish is the introduction of satellite ticket printers (PTS). The use of STP allows a travel agency to consolidate all operations of a home office, and still send all necessary inputs in several places at once through various news agencies. As the term suggests, the machine prints airline tickets on site immediately, eliminating shipping costs.
For London Fog, STP is a blessing. Budget Annual T & E London fog over 15 million are divided equally between its two locations in Eldersburg, Md., And the city of New York. Each location buys the same number of entries, so that equal access to the ticket in your organization is a must. With PBS in two places, the company services both offices with an agency in Baltimore. Each office has access to immediate air and manages to save by not having to pay for mail and express courier fees that can range up to $ 15 for each of the more than 500 entries each annual purchases.
Quote from T & E Annual Conde Nast Publications' of more than $ 20 million is divided between its locations in Los Angeles, San Francisco, Chicago, New York and Detroit. Since 1994, travel arrangements were handled by an advanced travel management centralized agency in the city of New York, by installing an STP in each of these five areas. In addition to increasing the efficiency due to consolidation, Conde Nast now has the ability to change travel plans at any time and have new tickets in hand instantly.
The real benefit is that the machines are owned and managed by the travel agency., So there is no cost to the company. Because of the great expense involved, however, remain the only option for STP major ticket buyers. "STP is a viable option in this process to any place you buy more than $ 500,000 per year in the air," says Shoen.
As averages of airline tickets 43 percent of T & E expenses of any company, the savings that can be achieved through the various uses of technology have become dramatic. For example, the ability of companies to collect and analyze their own travel trends led to the creation of the net rate of negotiating a purchase price between a company and an airline to purchase tickets at no extra charge commissions, overrides, transaction costs, transaction costs and other agency cuts.
Although most US carriers publicly proclaim that they negotiate corporate discounts below market rates published, American Express survey on business travel management found that 38 percent of US companies had access to, or had already implemented reduction negotiated airfares. Availability and mechanics of these agreements vary widely by society.
What is the price?
Fred Swaffer, transport manager for Hewlett-Packard and a strong supporter of the net price system, launched the concept of fixing the fee-based with travel management companies contracted with HP prices. He says that HP, which spends more than $ 528 million annually in T & E plans to have all the net rate as a function of air travel pricing. "Currently, we have several net in stages according to the rates," he said. "These rates are negotiated with the airlines at the company, then reach each of our seven geographic regions."
Frank Kent, Western regional manager for United Airlines, agrees: .. "United Airlines is participating in a reduction in the volume of business, such as buying tickets in bulk, but prices net I have not seen a single net rate agreement that makes sense to us we are not opposed to it, but just do not understand right now. "
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