Results at a glance
- Reduction of total cost of trip by 2% for each division at country level, by updating travel policy and changing traveler behavior
- 3.5% of T&E spend in potential savings
- Targeted actions: 54% of total savings potential
Challenge
A global financial services company with a mature travel program were ready to take the next step to uncover spending blind spots. They wanted to weed out suboptimal supplier deals and gain a single view of their total travel & expense (T&E) spend. They wanted to then drill down to the country and city level to uncover new areas for saving in the business.
With a mature air and hotel sourcing strategy, plus TMC data and analysis, the company had already optimized its travel policy. It had identified savings areas within the individual TMC and supplier spaces. However, they knew they were still missing other, hidden savings. They aimed to identify areas of off channel booking (air, hotel) where they did not have any visibility such as dining and ride hailing.
To get to the next level of cost savings, they needed to get full visibility of 100% of their travel expenditure by consolidating TMC, expense, credit card and HR data.
Solution
The client was already working with CWT Solutions Group consultants to make recommendations based on insights sourced from TMC data.
Taking this project to the next level, CWT worked with the client on a data consolidation project to bring together TMC, expense, card and HR feeds in order to get full visibility on their T&E spend. This platform, called Travel Consolidator, captures every part of the organization’s travel and expense spend. Its data algorithms consolidate, standardize, de-duplicate, and clean up the data, saving the company time and hassle of having to fix inaccuracies.
With this view, the client could take a more granular approach to assessing different areas of the business, including suppliers and segmented traveler groups. They could group transactions into ‘trips’ based on the time activities occurred and the type of spend. They had the opportunity to implement ‘total cost of trip’ as a new metric to measure traveler compliance and fine-tune their travel policy rules.
Results
By implementing Travel Consolidator into their program, the client was able to uncover a potential reduction of total cost of trip by 2% for each group division.
By working with their Solutions Group consultant, the client benefitted from a one-off analysis which identified savings opportunities, and revealed tangible areas where they could take immediate and targeted actions:
3.5% of potential savings on their T&E spend across 3 countries.
Travel Policy update: The organization set an average cost per day per destination, plus a cap for unmanaged travel spend categories such as dining and ride hailing. The same amount ‘per diem’ was allocated to all travelers for all the destinations. Using Travel consolidator insights, the client was able to adjust this amount by country, decreasing it for some countries (savings) and increasing it in some cities (traveler satisfaction), leading to:
- Targeted communication to non-compliant travelers to help change their behavior
- Better compliance by raising awareness about cost savings opportunities across business units
- The ability to define more cost-effective locations for conferences or meetings
Insight that biggest savings could come from two business units, representing 54% of total savings potential.
Savings could be achieved by taking actions focused on air supplier management by:
- Leveraging relationship with identified suppliers for further discounts
- Identifying non-preferred airline spend in order to include these airlines in the travel program
- Reducing average ticket price (ATP) by booking in-channel and changing traveler behavior with targeted communication