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Demand management
Demand management was born in the wake of the recent financial crisis. Companies – faced with pressure on cash-flow and a downturn in orders – looked for ways to cut costs quickly. So despite business travel’s importance for generating business, it became an easy target. Some companies introduced travel bans – after all, the easiest way of saving money is not to spend it. To manage the demand, in other words. Everyone agrees that this is an important part of travel management, but there isn’t consensus on the definition. In a white paper on the subject, FCM says: “Demand management is the process of cutting cost by influencing the quantity and/ or specification of the products and services you are procuring.” For some, such as American Express Business Travel director Sebastien Marchon, it is “monitoring the total number of trips made”. Many companies initially took the straightforward approach of reducing the number of business trips. Improvements in technology and its growing use in day-to-day life undoubtedly made this approach easier to implement than it might have been a few years earlier. Travel alternatives became the
catch-all phrase for remote meetings via desktop solutions, such as Webex, videoconference options, such as telepresence, and straightforward conference calls. More significantly, companies started looking upon travel for client-facing meetings differently from that for internal meetings. A number of companies introduced policies promoting the use of travel alternatives for internal meetings. Colleagues generally started having fewer face-to-face meetings. It was not unusual for colleagues in different global locations to go from, say, meeting every two months to doing so only once a year and using alternatives the rest of the time.
FACE-TO-FACE CONTACT The situation for client-facing meetings was different. Some
recognised their importance and ring-fenced these from any travel ban; others put a stop to such trips, only to discover that the consequence was losing business to competitors. Advertising campaigns such
as United’s ‘It’s Time to Fly’ have emphasised the importance of face-to-face contact. But despite the best efforts of the copywriters, most modern business travellers don’t find slogging through airports with their security and immigration queues
Some recognised the importance of client-facing meetings and ring- fenced these from any travel ban
glamorous and would prefer to spend more time with their families. As Rohan Alce, a veteran airline executive, said at a recent UK travel industry conference: “When did business travel stop being fun?”
HOME WORKING It’s not just that the business travel experience has deteriorated. People’s attitude to the working environment has changed dramatically in the last five years. Not so long ago, remote working was something directly negotiated by someone who wanted to live far away from the office or reserved for new parents who elected to work from home one day a week. A home office is no longer the exception and it’s not only the self-employed working from home. There are a large number of home workers who visit the office only once a week or fortnight, so conference calls and web conferencing have become much more mainstream and integral to the working day. As Louise Kilgannon, travel buyer for a multinational pharmaceutical firm and a member of the Institute of Travel & Meetings board, says: “In the past I might have had two face-to-face meetings, but now maybe I will do one and then do the other as a videoconference. This has become a much more natural way of working.”
Those in work in 2014 are also likely to be working longer and harder, so are therefore very happy to opt for a phone call rather than a journey when it is appropriate for the purpose. As Carlson Wagonlit Travel director Nigel Turner points out, how we ‘meet’ people is not as straightforward as it once was. He says: “The way we work has changed. Time has become precious to us so people are perhaps choosing not to travel to gain more efficiency. We use conference calls more than we used to, not because people tell us to but because you can get the same thing done with a call, so demand- management is self-regulating. “We want to be efficient because we are more pressurised. Perhaps we don’t need a formalised system as much as we used to. We’re getting used to maybe not taking the trip.”
INFLUENCING BEHAVIOUR But demand management is about much more than travel avoidance. It is really about understanding and influencing the behaviour needed to deliver to the objective. Turner says: “Our role as a travel management company is to help our customers buy travel more effectively and travel more effectively, so they get better value out of every trip.” Like Turner, Kilgannon thinks demand management is about something bigger – it’s about travel departments becoming aligned with their stakeholders’ travel strategies. She says: “If I meet with a
stakeholder I try to understand what their requirements are and how to deliver that within budget. For example, we might suggest taking fewer people on a trip so this is all built into our communications. “Travel is back, but no way is there the tolerance for the same amount. You don’t see big teams on planes any longer. There’s a drive for a work-life balance. People have realised that they don’t want to be on the road every single week.”
Kilgannon and Turner both emphasise that demand management
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