The Debate LEARNING CURVE A STEEP
With sweeping cuts hitting the public sector – and travel budgets in particular – what can hard-hit buyers learn from the experiences of the private sector? We ask a consultant, a TMC and a supplier
THE CONSULTANT Chris Pouney, Founder, Severnside Consulting Public sector purchasing managers may bemoan the latest raft of cuts while being under the microscope from the public and watchdogs alike, but this is nothing new to his counterpart in the private sector who are used to operating under such scrutiny. This is particularly true of those in the finance industry whose firms were part of the recent government bail outs. Travel has become not just about doing the
right thing, but being seen to be doing the right thing too. Ironically, this can create situations where travellers could end up sitting in economy, when business class is cheaper, just to reassure the shareholder (and in some cases taxpayers) that money was being spent well. Perception is reality. So what can the public sector learn? I think
there are seven broad areas of good travel management and they are: Collaborate and communicate: government departments should collaborate whenever possible, not just when a project delivers a saving. The government hotel programme is a great start but this should be just the start. Benchmarking: both with other government agencies, but also with like-sized organisations in the private sector. Challenge your TMC to do this. Ask them ‘what should we be doing, and what are other organisations my size doing to save money?‘ Get your data to work for you – what is it telling you? Have suppliers interpret it and find out how you can use it to reduce costs. Challenge inconsistencies in the end to end
travel process: payment is the common one. Where inconsistencies exist, then so does the opportunity to reduce cost through standard- isation processes. Knowledge is power: Sir Philip Green’s report
of last autumn on government spending highlights concerns over data. Reports later showed that over £900million of travel spend was ‘unclassified’. While any savvy travel manager will know there is always leakage, every effort should be made to fully understand these gaps by partnering with expense managers and suppliers alike. Effective communication at all levels: in an
organisation of many thousands of employees, how can I possibly speak directly to my travellers and bookers? I strongly recommend you try. Start with people who have lodged a service complaint recently, then move to top travellers and then to one-time travellers. Pick up the phone and ask them about their experiences and what they think the organisation should be doing to reduce travel costs. Ensure that feedback is heard and travellers, travel bookers and budget holders feel they have a voice in the travel programme. Befriend the budget holders: these are your
‘eyes and ears’. If they understand travel policy and savings opportunities, you are more likely to achieve targets. Review how low fare options are put to your travellers and bookers: I am a firm believer that no matter who you are, if the right information is delivered to the right people at the right time, the right decision will usually be made – often with no mandate actually needed. Budgetary controls such as these listed above should be seen as 'business as usual', not just looked at when the economic cycle requires it. We need to all get used to this way of working because it’s not going away!
THE TMC Chris Thelen, CEO, Chambers Travel Management There was a time not that long ago when one might have asked how the private sector could learn from the public sector, but I don’t think that’s the case anymore. When in December 2009 OGC Buying Solutions announced their plans to negotiate a framework agreement for the £400million public sector travel expenditure, there was some excitement from suppliers and a hope that this would streamline the labour intensive OJEU processes that were required to win a piece of public sector business. Unfortunately, the framework process became more complex and time consuming than any previous process and, additionally, the aggressive and somewhat unrealistic tender requirements and commercial expectations meant that Chambers Travel chose to opt out of the bidding war. OGC Buying Solutions have now established
two separate, four-year framework agreements in less than three years and it appears that these frameworks have still not quite met public bodies’ requirements. This could mean that the
22 I THE BUSINESS TRAVEL MAGAZINE
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