Business Travel News has named Ralph Colunga, Oracle senior director of global travel, meetings, data, sourcing and card services, as 2007 International Travel Manager of the Year. Colunga was recognized not only for leading a massive, rapid multinational consolidation of Oracle's $585 million T&E spending into a follow-the-sun travel management service environment, but also for initiating and facilitating a benchmarking effort with travel buyer peers.
Colunga, who BTN recognized as a Best Practitioner for leading a follow-the-sun initiative for previous employer Cisco
(BTN, July 5, 2004), took an innovative and ambitious approach to Oracle's previously fragmented program. He quickly built it into a rationalized cohesive organization working to accomplish the lofty goal of reducing Oracle's global travel operating expenses by 40 percent by the end of May 2008.
To do so, Oracle implemented a global travel policy, a global card strategy for its 60,000 cardholders, a global hotel program, a global meetings strategy, one global travel management reporting system using TRX, one primary online booking tool, GetThere, one global distribution system, Sabre, and the consolidation of global travel management services with one agency, Carlson Wagonlit Travel. The rationalization of travel agency sites from 91 to a targeted 12 by year-end also has moved the company quickly toward its follow-the-sun goal
(BTN, Sept. 10).In doing so, Oracle established a new Middle East center in Cairo, Egypt, which is servicing 14 countries. Its Warsaw center, now serves up to 15 countries and will serve 19 countries by the end of the next fiscal year. In Asia/Pacific, the company consolidated New Zealand into Australia and now is determining the site of a business travel center to serve 13 of the 16 countries in which it does business in the region. It also consolidated Canada into the United States and is consolidating nine Latin American countries into one business travel center by year-end.
In 14 months, Colunga and his team's efforts reaped considerable savings for the Redwood Calif.-based Oracle, including a 30 percent decrease in cost per transaction in both the United States and Europe, the Middle East and Africa; a 27 percent year-over-year decrease in Asia/Pacific operating expenses, a double-digit reduction in dedicated agency headcount, a 50 percent reduction in after-hours calls and a 54 percent drop in separate hotel and car passenger name records.
Despite the breadth and urgency of his mission to overhaul nearly every aspect of Oracle's approach to travel, Colunga still found time to reach out to 27 travel buyers to form a benchmarking analysis group to measure policy and open channels for the sharing of travel management best practices. Fourteen companies shared data with Oracle's comparing the use of business class air travel, low-cost carriers and advance purchase thresholds.
"We wanted to benchmark our policy to determine if we were either too strict, too lenient or on par with our peers in the industry," said Colunga. "We did not necessarily feel relative size or like companies was essential as we wanted to better understand what other companies' internal positions were regarding travel policy. We felt no doubt that large companies can just as readily learn from small ones."
Findings of the initial benchmarking survey of policy practices were reviewed with the other participants via conference calls and Colunga shared the findings with a broader audience at Carlson Wagonlit Travel's global client conference. The benchmarking program recently deployed another survey examining air payment practices of central billing versus individual payment. The International Association for Contract and Commercial Management and the Procurement Strategy Council also offered to work with Oracle to reach a broader audience or industry groups, Colunga said.
"We believe in learning for a broad travel audience, consisting of both large and small companies, to expand our sphere of influence with our management, with our programs and within the travel industry for a greater good," he said.
Colunga, who joined Oracle in June 2005, set the backbone for the follow-the-sun program in December 2005, beginning with a reorganization that broke the travel program into five silo organizations: travel, meetings, sourcing, data and card services. He also built a travel team of three global travel operations managers who oversee three world regions—the Americas, EMEA and Asia/Pacific. Colunga also has two regional travel operations managers responsible for a number of countries in each region.
"The global ops managers focus on travel strategy and issues of continuity in our travel program with our CWT counterparts as we move to our follow-the-sun service model," Colunga said. "We have also established a travel sourcing team whose main purpose is to maintain the proper business relationship with our suppliers. A managed supplier partner program ensures that the suppliers are not only living up to service level agreements, but that we at Oracle also live up to our commitments. It also provides our suppliers with a voice."
Using a cross-departmental approach, Colunga established a managed supplier partner program, which is handled by the travel sourcing organization. The program ensures that both suppliers and Oracle's travelers are living up to contract commitments through quarterly meetings and reviews with suppliers. The supplier relationships are owned by the sourcing team and not the travel operations managers, which "allows for a separation of powers," he said.
"You have to establish good, firm working relationships with your suppliers. It's not a question of whether they have to be profitable, but how much profit they make, and that part is negotiable. You don't want them to go out of business because ultimately that is going to hurt the corporation and the business traveler, so it's about sitting down and ensuring their goals are being met, while ours are as well."
In Oracle's program, the team leverages cross-departmental knowledge to come up with the strongest solution to achieve their goals.
"There was a great concern when we were starting, especially when establishing teams working virtually, because you have to trust people number one," Colunga said. "You have to trust that they are professionals and are doing their jobs. I am a firm believer in giving people chances, but also that you get greater buy-in when people have a stake in the decisions. People feel valued and this team very much feels that way."
Previously, Oracle used seven GDSs, three online booking tools, four regional travel policies and 22 payment methods, with CWT serving as Oracle's travel management company in 56 countries, while another 18 countries used a bevy of agencies. The implementation of a global travel policy produced noteworthy savings as travelers adhered to such changes as a seven-day advance purchase policy, which has reduced the average ticket price by 15 percent. As of August, 73 percent of all tickets were booked outside of the seven-day threshold. Prior to the change, Oracle had reached a high of 63 percent of tickets being booked less than six days in advance.
Automation proved another key driver of savings, as Oracle adopted GetThere as its primary online booking tool. By the end of 2007, it will have rolled out GetThere in 29 countries and it is targeting 44 countries by the end of May 2008. Using a communications program that made the benefits of online booking visible to travelers, Oracle already has achieved the milestone of making more than 90 percent of its bookings online in North America and EMEA, where most bookings are made without agent involvement or other changes.
Colunga said the global network of regional operations managers who leverage each other's knowledge to collaborate on projects has been instrumental in driving the efficiency of the program. "Is it absolutely perfect? No. It isn't nirvana, per se, but it's a well-oiled cohesive unit that thinks globally," he said. "The global travel operations managers are trying to learn the issues in the other people's regions. They are not just worrying about what is taking place in one region. The Asia/Pacific manager wants to know what's happening in EMEA, as well as the Americas and vice versa."
Colunga said it would have been cumbersome if not impossible to accomplish anything without senior management support. "Senior management has empowered us to make business decisions to balance the needs of our business travelers in keeping with our corporate goals, maximizing the value of every travel dollar, ensuring cost tracking and control, monitoring policy compliance, creating savings through negotiated discounts and mitigating risk by centralizing employee travel," he said, noting their support was "critical in communications out to the employees."
"Consolidating agency, corporate card, supplier spend and expense reporting data through a data consolidator is critical," Colunga said. "Aggregating it into meaningful accessible reporting is essential. Ensuring your management can understand what you are presenting—priceless."
With an integrated veteran team and senior management support, Colunga said, "we are going to achieve in two years what it took more than four in my previous life at Cisco," and he is armed to further consolidate Oracle's program and harness the travel assets that have not yet been brought into the follow-the-sun strategy.
"We've had the low-hanging fruit or quick wins," Colunga said. "Now it's a matter of what are we going to do in those areas where it is going to be a struggle, like what are we going to do in countries that need to be stand-alone like China, India and Japan. As we continue with our consolidation strategy, it's what is phase three and beyond."