Note: This article was originally published on LinkedIn by Donna Brokowski, Direct Travel’s EVP of Global Supplier Management & Consulting. We’ve republished these thoughts below as part of Direct Travel’s ‘Whatever It Takes’ series.
On a recent call, one of Direct Travel’s preferred partners shared the following staggering piece of internal news: As a result of the COVID-19 Pandemic, they are sending out what amounts to nearly a year’s worth of information every single day.
Even as restrictions in some areas ease, the travel buyer’s need to stay informed continues to grow. From temporary hotel closures and subsequent re-openings to airline route modifications and waiver policy changes, travel suppliers are pressed to get updates out, and travel buyers are equally challenged to keep up with the spread of new information.
To prepare for buyer-supplier conversations when travel resumes, buyers need to re-group and research to ensure effective negotiation outcomes. They will need to understand how to use the information of today in order to move forward and adapt to the “new normal” of corporate travel for the future. To guide you through this process, I recommend focusing on the simple, guiding tenants of the “four S’s of travel”: Profile of Spend, Profile of Suppliers, and assessment of balance between Savings versus Security.
Start by determining your company’s new profile of spend, both for the short term and the long term. It is more important than ever to stay close to each of your internal departments that travel. Conduct research by surveying your anticipated travellers and asking the following: why are they travelling, where are they travelling, and when do they expect to travel? Once armed with this information, supplier-buyer conversations will be much more productive as buyers can provide clear measures of validity for their travel. As a result, suppliers will be able to substantiate better pricing models and offer those buyers more favourable contract terms.
In addition to determining your new spend, identify what kind of requirements will be in place for how your travellers get there and where they stay. Begin by recognizing that the costs and amenities once negotiated in the past may no longer be negotiable. For example, safety standards have changed as have flight capacities and service levels. Fees or upgrades that were once optional may now be impacted by changes in standards and government requirements. Inversely, watch for mandatory health-related fees that did not exist before and be prepared to include this in your forecasted total cost of sale in travel.
Once you know your new profile of spend, look to re-assess how your preferred supplier profiles have changed. The supplier landscape continues to evolve, and change is the new norm for the foreseeable future. Air carriers cannot tell you what their route network will look like in six months, let alone next year. Hotels that are closed may open partially, or open and close again as government restrictions change. Ground suppliers may play a very different role in your travel portfolio for short-distance trips until air capacity returns.
If you travel to an area where your previous preferred partners no longer offer travel or accommodations, you may need to look at alternative suppliers. Review the culture of your travellers (Do they prefer upper upscale versus midscale hotels?), coverage (Does this supplier best fit my new travel spend profile in terms of product?), and cost (Can my company afford this segment of travel or do we need to consider “buying down” for a short time to save costs?).
Savings & Security
In a world where supply is reduced and safety is at a premium, the emphasis on savings has taken a temporary backseat. As hotels reopen and corporate travel resumes, security will be scrutinized and the trade-off of savings (or lack of savings) evaluated.
Inevitably, we all have a new language to learn—a world where we talk about things likes microbes, HEPA filters, N95 masks, and social distancing as they relate to travel buying decisions. Already, we are seeing risk management and security take center stage in travel policy changes. If you haven’t yet, consider forming a travel committee with stakeholders from each travelling department within your company. Include representatives from your risk management and HR teams to discuss where the need for travel is and what the risks pose.
A solid RFI/RFP sourcing strategy can help buyers engage with the right suppliers. Now is the best time to collaborate on these initiatives with your TMC for assistance as you maneuver through this new environment. They can recommend a solution that fits with your specific company goals and adapt with your new Spend, Suppliers, and Savings versus Safety requirements.
Travel policy compliance measures and a solid employee engagement plan will be critical to ensure your employees can travel confidently and with company-approved vendors. Travellers will need to be cognizant of whether features like mobile check-in are not only preferred but required in order to be travel policy compliant. Approval may be required to book hotels that fall outside these parameters and security teams will have to communicate to travellers which bookings will be at the travellers’ risk. The cost of travel still matters, but it will be more important to identify suppliers that can commit to compliance across health and safety requirements.
To help you stay informed and prepare your corporate travel program, our team at Direct Travel has compiled a resource hub updated with the latest information as the pandemic slows and business travel gradually resumes.