Data and information is all around us, available virtually at the click of a button. Yet, within the corporate travel management arena, the most effective use of data is not being fully realized. As the CFO within your business, understanding the importance of collecting, analyzing and presenting relevant data is critical to the strategic success of your business, as CEO’s are requiring increased transparency and visibility into your business’ finances.
Utilizing available data is also necessary as you create your next travel program request for proposal (RFP.) Many times RFP’s are developed using a simple template, or the latest numbers are simply inserted into the appropriate categories from your previous RFP. When you thoroughly leverage your business’ data prior to developing a travel program RFP, you’ll receive a more detailed, cohesive response from travel management companies (TMC) that will improve your bottom line, and save time during the RFP process.
How can your business effectively leverage data when developing your travel program RFP?
Determine what data is available and how to get it
This is the first and most critical piece in effectively leveraging data to achieve the best results. Collect and review the data points that are available to analyze regarding your business’ corporate travel program. The following six data points provide an initial look into the data available for you to utilize:
- Total volume of travel spend; overall, by product (air, hotel, car, etc.), by department or by cost center.
- Average transaction cost compared to plausible benchmarks. What is your business’ average airline ticket cost, and how does that compare to industry standards? Topaz International and other third parties provide this data, as do many TMC’s.
- Lost opportunity compared to lowest fare available. Compare the lowest fares for each itinerary to what your traveler selected to determine potential lost savings.
- Preferred supplier performance and/or opportunities. Determine where your volume lies within each of these areas and where improvements could be made.
- Travel purchase by source. What was purchased from your current TMC, both online and over the phone; and through alternate sources (online sites, supplier sites.)
- Policy compliance. The details in your current travel policy will help you assess whether travelling employees have stayed compliant within the program, and give you data suggesting where travel policy weaknesses lie.
The data collection and analysis process will give you an accurate assessment of where your corporate travel program is right now, and provide visibility into the needed areas of improvement. This provides a clearer picture of what your business may need from a TMC.
Analyze how a TMC might impact T&E savings, based on data
There are many ways working with a TMC can positively impact your business; increased employee productivity and overall control of the corporate travel process, and consistent support for those closest to the travel program increase the efficiency of your corporate travel program.
In addition, a goal for all businesses is increased cost-savings when working with a TMC. As the second largest controllable expense within your budget, the T&E line item must be closely monitored to impact overall business savings. In order to garner the best results from your RFP process, it’s imperative to analyze areas from which savings can be vetted. Are airline ticket costs larger than industry averages? Do the ancillary fees associated with travel (baggage costs, seat upgrades, etc.) represent a larger-than-expected piece of your travel budget?
As an example, in 2014-2015 we analyzed the work we did for our clients and found that for domestic airline tickets, the national average ticket price was $572. Our clients paid an average of just $447 per ticket – a savings of $125 per ticket.
A more efficient, data-driven RFP process requires taking the time to learn where your business could spend less, and then understanding how and with what tools a TMC can increase overall cost savings.
Expect results based on data provided
When you leverage data to create your corporate travel program RFP, an expert TMC should be able to show results and demonstrate how they can (or cannot) create savings and provide predictability when managing your T&E line item. A TMC is not a travel agency or an online booking system; an exceptional travel management company should provide your business with the support and processes that help you manage your full T&E process, not just the booking transaction. Their travel leadership should create overall costs savings, provide increased control over your corporate travel program and increase compliance with your business’ travel policy.
Leveraging data is key in the successful development of your next corporate travel program RFP. Taking the above steps to collect, analyze and present relevant data will save you time within the RFP process; in addition, understanding your data will generate responses from expert travel management companies that can and will meet your SME’s specific corporate travel strategy, and provide support and control for your T&E line item.
How have you effectively leveraged your SME data to develop an outstanding RFP? Are there specific tips you can share? We’d enjoy your comments below.
If you are in the process of developing an RFP for your corporate travel program, our workbook entitled, 8 Common Travel Management RFP Mistakes will help you to design an RFP that delivers results.