The Knowledge > Corporate case study
How to... CONTROL HOTEL SPEND
Expansion at telecommunications contractor Kelly Group highlighted a growing need to get a better handle on hotel spend. Gillian Upton learns how they did it
Jimmy Bradley DEPUTY FINANCE DIRECTOR, KELLY GROUP Jimmy joined the Kelly Group in March 2004 as a group financial controller. His previous experience was in publishing where he spent nearly 15 years working for the ILIFFE publishing group, before joining the BMA to become financial controller for the British Medical Journal. Since joining Kellys, Jimmy has introduced new accounting, budgeting, HR and wages systems in the ongoing drive to improve the group's reporting and decision making capabilities.
FEBRUARY 2011 was a good month for the Kelly Group. It secured a large contract with BT to install telecommunications equipment, which meant a large mobile force of 500 engineers travelling around the country in vans – often to remote locations – and clocking up lots of hotel nights. “It dawned on us that we were going to run up some rather large hotel bills,” says Jimmy Bradley, the group's deputy finance director. The company has 40 operational depots across the UK and a workforce of 1,800 that are chiefly engineers working at exclusively UK customer sites. Kelly’s customers are mostly large blue chip companies including the likes of British Telecom, Serco, Siemens, Network Rail, Thales and Virgin Media. Read on for how the company successfully tackled this area of business travel spend.
Step 1
The company was already
aware of the fact that its existing hotel booking process was a drain on resources and that prices had started to rise. The company already had travel guidelines in place – centred on lowest logical cost – with each site responsible for its profit and loss so site managers are focussed on cost. Two bookers at Kelly Group headquarters were the conduits in the booking process. They accepted bookings from the engineers by phone and would then search the internet for them and reserve a room. “It was laborious, not controlled and
there was no MI apart from the credit card information and certainly no visibility of where people were staying,” explains Bradley. Premier Inn was the main hotel
chain patronised but was unable to provide lower rates. “We would see hotel adverts for £29 and thought, ‘Blimey, we’re not getting a rate like
that and not getting the best deal’.“ More than ever Kelly knew it had to change its hotel booking process and supplier in order to provide better value, flexibility and to attain a service that prioritised the customer.
Step 2 Rather than a formal RFP
undertaking, Kelly asked around and two suppliers pitched, with HRS winning the bid and starting on the account in February 2011. “We liked HRS and its business model,” says Bradley. “There were no upfront costs, they offered transparent pricing and no real risk.” With no traditional travel manager position at Kelly, group purchasing manager Suba Muruganathan was the nominated project leader for the implementation process. The key areas for HRS to satisfy
were savings and ease of use. “They’re in a cut-throat business and every penny counts so price is key,”
8 I THE BUSINESS TRAVEL MAGAZINE
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