"Essential for decision making in travel"
Demand management is now at the forefront of business travel management, Nigel Turner said.
The director of public sector and industry affairs for Carlson Wagonlit Travel (CWT) said today (June 17) said it had become essential for travel management because decision making processes were becoming more complex.
Mr Turner was speaking in a seminar on demand and supply management at Business Travel Market (BTM), a new travel show, in London.
Before letting company travellers use the airlines and hotels, travel managers must understand what their objectives are, what controls are in place and what effect these are likely to have on the company doing it job properly, he said.
"Demand management is not just about travelling less but about how you are travelling," Mr Turner told the seminar.
He said there were three elements to demand management: cost avoidance, savings and sustainability.
He warned that cost avoidance, like using video conferencing and WebEx "could be very expensive and in the end you could end up spending more than you did before."
Savings were also becoming more complex with airlines and hotels both unbundling charges.
""Do you need all the services you are paying for? The hotel gym or the swimming pool? The options are becoming more complex," he said.
While sustainability was not so high on the corporate agenda because of the recession, Mr Turner said it would return and the choice between rail and air was also complex as once the decision was made, the buyer had to decide which supplier had the lowest carbon footprint.
"There can not be a more important time for demand management," Mr Turner said.
Duane Futch, vp travel procurement strategy for GetThere (Sabre), described demand management as the "process of reducing travel costs through strategic initiatives that influence behaviour and increase accountability."
Mr Futch, a former global travel manager for Walmart, said procurement was about sourcing, pricing and leveraging buying power on a global scale "which is vastly different" from demand management.
"There is more to demand management. It is about managing compliance and governance through a smart approach to travel management. You have to have that," he said.
He said companies needed to know what drove their travel: was it meetings, conferences, internal meetings? What was the frequency of trip and were they billable?
"Management says ‘Give us a programme to manage travel' so you need a plan in place so you understand what is driving travel and whether you want to offer an alternative.
"You don't want to say you will cut travel by 10% because the company has to continue to make sales and a profit. "
Mr Futch favoured the middle way by developing a strategy that derived savings from across the entire travel supply chain.
This would need support from the company leaders and minimise internal dissatisfaction if travellers had to stop using five-star hotel of going business class.
www.businesstravelmarket.co.uk [1] www.carlsonwagonlit.com [2] www.sabre.com [3]