When the eruption of Iceland’s Eyjafjallajokull volcano shut down European air space this past April, it stranded more than 10 million travelers across the globe. As travel management professionals know all too well, it was their company’s responsibility to provide reasonable accommodations during the crises for their business travelers, as well as a safe return home. While most companies worked hard to live up to this responsibility, doing so came at a cost, according to a recent online poll of travel buyers and suppliers conducted by AirPlus International.

With the advantage of hindsight, however, many companies are revising policy and process to reduce the impact of future transportation crises on their travel programs.
Eyjafjallajokull crippled the operations of European airlines, as well as intercontinental flights originating in countries from the United States to South Africa to Thailand. Nearly 100,000 flights were cancelled during the height of the crisis, costing airlines more than US$2 billion. As the volcano continued to choke up ash into May, pockets of additional cancellations and delays rippled through the European airways. The full impact of the eruption on the airlines has yet to be calculated – and the same is likely for the companies whose business meetings were cancelled or postponed.

More than 73 percent of the companies surveyed by AirPlus indicated their travelers or travel management program was affected in some way by the eruption. The majority of respondents indicated that extra travel expenses incurred by stranded business travelers had a significant impact on their travel programs. While additional costs may have been the most widespread concern, respondents revealed several others.

Communication is key during a crisis and, thanks to technology, most survey respondents (nearly 88 percent) cited adequate communications with grounded travelers. Cell phones proved essential to the effort, with 28 percent of survey respondents indicating they were the most effective method of communication. The company email address was the other essential tool, and with 70 percent business travelers now carrying smartphones, receipt of these messages was likely supported by this type of mobile device.

Still, nearly one-third of survey respondents indicated they wanted to make sure their communications plan during a crisis is more clearly defined and easier to execute. They will be revising their communications policies and procedures in response to the weaknesses in their travel programs.

Download the free PDF for full survey results.
AirPlus…The Wire July 2010 (PDF, 250 KB)

Additional Resources:

Air Industry Experts Discuss Volcanic Ash Lessons

Europe Easing Air Restrictions

The Days the Earth Stood Still

While Linked In users held steady at about 58 percent, use of Facebook increased among surveyed travel management pros by almost 25 percent over last year’s numbers. Use of Twitter, which was employed by 15.5 percent of survey respondents last year, ostensibly doubled its numbers in the 2010 survey. Corporate travel industry blogs were another big performer in year-over-year comparisons, with 20 percent of respondents indicating they participated in this format in 2010 compared to less than 13 percent who did so in 2009, an increase of 50 percent.

Overall, a higher percentage of survey respondents cited use of social networking sites this year. Just under 72 percent of respondents indicated they were using social media cites either personally or professionally last year. That number increased to 77 percent in the 2010 survey.

Survey respondents indicated that traveler use of social media sites for travel-related recommendations and/or services has also been on the rise since last year. Forty percent said that their travelers had increased use of social networks for travel-related research, while less than 5 percent thought that it had decreased.

As a new generation of business traveler enters the workplace with plugged-in lives and consumer-style expectations for enterprise technologies, managed travel programs would do well to explore the options now.

Download the free PDF for full survey results.

AirPlus…The Wire June 2010 (PDF, 250 KB)

Additional Resources:

5Q With Travel Manager Michelle De Costa

10 Top Travel Management Tactics for 2010 (webinar)

Reinventing the Water Cooler: Buyers and TMCs Exploring Social Networking

Is Tech Driving the Traveler-Centric Future? Managers Fear Loss of Control

You can download the complete study here. (Available in German only)

Richard Crum, AirPlus US President comments on the survey results, with a look at the good…the bad…and the outrageous.

Corporate travel  managers worldwide are feeling the pain of the economic slowdown.  Many travel managers are reassessing their travel program to account for this new equation, according to the Wire’s February survey of corporate travel managers. However, on the bright side, the uncertainty from Q4 2008 has resulted in new savings opportunities in Q1 2009.  Among those surveyed, nearly 84 percent have already implemented changes to their travel programs since Q4 2008 or are looking into the opportunities right now.

Other results show traveler compliance is also a strong focus, with more than 76 percent of the surveyed travel managers looking at stronger mandates. Policy adjustments that address new travel market realities are next  at just over 71 percent and preferred contract re-negotiation a strong third, with more than 64 percent of travel managers looking for additional savings as airline, hotel and ground transportation markets continue to shake out.

Indeed, market volatility contributed to a protracted contract season for corporate travel professionals. Many travel managers were slow to finalize agreements. Starwood Hotels reported in January that only 70 percent of corporate contracts were finalized at that time despite the fact that negotiations traditionally begin in early fall. Analysts encourage corporate travel managers to look at Q4 hotel activity as a basis for renegotiating contracts for 2009 or going after additional value-added benefits even if annual contracts have been finalized.

However, the airline industry was tagged as the market segment most difficult to pin down at over 61 percent.  While fuel costs and capacity threatened to raise ticket prices at an historic pace in 2009, dampened demand in both the business and leisure markets has countered these increases. Travel managers have also seen some relief though, with fuel surcharges, especially on transatlantic routes, starting to come down.   Most analysts now predict modest rate increases on most domestic routes in North America of 2 percent to 5 percent. Travel managers can look for rate increases of -1 percent to 4 percent on international routes originating in North America.

As travel budgets continue to undergo immense scrutiny and cuts, demand management initiatives and travel alternatives have become two more areas of significant focus in 2009.

Additional Resources:
Procurement.travel, January 29 News Brief
Smith Travel Research U.S. Regional Performance Recap ‘08
Smith Travel Research Global Posts Year-End, Dec. ‘08 Data
Advito 2009 Industry Forecast Update

Download:
Note: There is a file embedded within this post, please visit this post to download the file.AirPlus, The Wire, March 2009  

Video:
Richard Crum, AirPlus US President comments on the survey results (MP4, 8.27 MB)
See also Video-streaming

Survey Methodology- For this issue of The Wire…from AirPlus- AirPlus International in cooperation with ProMedia.travel surveyed 143 travel management professionals in North American and Europe from February 9-20, 2009.

According to the current AirPlus International Travel Management Study, important trends and scenarios are emerging that will shape the future jobs of travel managers.

1500 travel managers from Europe, the USA, Mexico, Brazil, South Africa as well as China, Singapore and Australia were interviewed for the study. In general, they expect a clear expansion of their tasks in the areas of procurement, advertised bidding and climate protection. Over half of those surveyed believe that their responsibilities will come to include yet other areas; another 20% assume that this will be at least partially the case. In addition, two out of three travel managers expect that they will also assume the role of event manager.

Financing and controlling will continue to be among the most important travel management tasks. Over 80% of those questioned expect that their travel budgets will increasingly be examined based on a branch-by-branch or international level. At least as many (67%) expect a distinct or at least partial (16%) increase in the significance of financing. This is hardly surprising given the fact that almost 60% of all travel managers must adapt to expectations that their companies will be confronted with rising expenses for business travel in the future. Only every tenth of those questioned believes that costs will decrease. Climbing expenses will probably most clearly affect companies in South Africa, the Asia-Pacific area and the USA. 70 to 80% of travel managers in these countries expect rising budgets.

Flights are considered to be the primary ‘price boosters’. Nearly two-thirds of those surveyed expect prices to rise (some even expect sharp rises). Another third assumes that expenses for flights will gradually settle down at current levels. Those questioned consider price booster number two to be hotels. Over half expect rising prices in this area, 40% expect them to remain the same and only 6% think prices will drop. In the expense segment ‘meetings and conventions’ and rental automobiles, some 30% of those surveyed anticipate their costs to rise in coming years.

Due to additional burdens on their budgets and added responsibilities, travel managers are also worried about the negative effects on their jobs. Even today, over 40% of travel managers feel clear pressure when they plan business travel; 60% can only devote a quarter of their work time to their actual responsibilities due to their additional tasks.

Read also: “The role of travel managers: All that glitters is not gold”.

During recent years, many companies have come to the conclusion that business travel is an area in which costs must be controlled, processes optimized and a central travel management function established.

But how? Whereever you are located, you can find help and support from the following organizations:

ACTE – Association of Corporate Travel Executives

ACTE is active throughout the world and advocates the development of internationally recognized travel practices. This approach is expanded through the specific experiences of its regional members. ACTE correspondingly develops relevant and feasible programs and events.

In recent years, the ACTE model has become an industrial standard.

(www.acte.org)

VDR – Verband deutsches Reisemanagement e.V.

This German association includes over 500 members and providers from renowned companies in all branches. Its primary purpose is representing member interests at the national and international levels.

The VDR also wants to create a framework that simplifies travel management for its members. It thus promotes dialog between members as well as knowledge-transfer from company to company.

(www.vdr-service.de)

Travel Industry Club

This club is not an organization as are the two above-mentioned associations. Rather, it is a business club that sees its task as enabling networking among its members and serving as a communications and knowledge platform.

Its “unique selling point” is the diversity of its members. These members contribute to strengthening the significance of the “travel management” field through their personal commitment.

(www.travelindustryclub.de)

NBTA – National Business Travel Association

This organization connects the business travel world. Its aim is to support – similarly to the Travel Industry Club - strengthening the significance of travel management. The NBTA creates a forum where members can exchange constructive ideas and information.

The NBTA likewise offers numerous educational and training opportunities and holds an annual International Convention and Exposition.

(www.nbta.org)

To optimize your business workflows in today’s global economy as well as to act quickly and efficiently, global travel management is essential for your company.

Based on your company structure and corporate culture, a standardized framework should be developed that can provide enough room for regional and cultural distinctions.

Standardizing travel guidelines not only increases your company’s efficiency, but is also important for ensuring equal treatment of employees, maintaining their safety during business trips as well as upholding your Corporate Social Responsibility.

Travel managers should not rely only on their own typical, country-specific workflows. Open-mindedness and an awareness of habits and needs in other countries is important. Get to know these regional distinctions, respect them and integrate them into your framework.

Local employees can help overcome the barriers that foreign languages and cultures evoke. Such employees, together with their local networks, can support your global travel management activities and make them more effective and efficient.

Think globally – act locally!