When Karen Hutchings collected her BTN Multinational
Travel Manager of the Year award at the recent Association of Corporate Travel
Executives global conference in Paris, her visit was brief. The EY global head
of travel, events and meetings had to fly straight back to London to pick up
another award that evening, this one from her employer, in the ‘Innovation’
category of EY’s Executive Better begins with you award.
The simultaneous external and internal recognition for
Hutchings is a testament to her transformation of one of the world’s largest
travel programs (annual air spend alone is US$600 million across member firms
in more than 150 countries) into an operation with global power but acute
sensitivity to the needs of travelers, local managers and even suppliers.
Hutchings’ program also is characterized by a willingness to invest in her
travel team, both putting money behind manpower on the understanding it will
bring financial return but also placing faith in team members to propose and
see through a long list of smart innovations.
Hutchings leads an exceptionally large travel and meetings
team of 50-plus worldwide, including meeting planners. That is actually a
smaller number than when she joined EY in 2012, a point at which, she said,
“the organization was on a global journey but not moving fast enough.”
Hutchings slimmed down the numbers to emphasize quality over quantity and set to
work nurturing their talent.
Every six months, for example, she mounts a “whiteboarding
project,” asking her team what they would do differently with the travel
program. The most recent such exercise generated 20 projects, of which just one
was rebooking “attrition rooms,” the sleeping rooms that go unsold when an EY
firm block-books a hotel for a meeting. EY now runs reports to find which
transient travelers are visiting the same city on the same night and, where
appropriate, rebooks them into one of the attrition rooms.
EY in India also employs a travel support function to
encourage smarter booking. The five-strong unit has, said Hutchings, “become
self-funding” through its activities. In addition to auditing travel management
company versus online rates, it monitors a log of internal training sessions
arranged by EY personnel worldwide. If, after two weeks, trainees have not yet
booked travel, the support team encourages them to make reservations. As a
result, the average reservation lead time is lengthening and average fares are
falling. “If we can reduce our air spend by 10 percent through changing
behavior, we will have achieved our savings target,” she said.
Traveler Behavior
Hutchings has devoted her greatest energies to altering
traveler behavior for two reasons. One is that she is tasked with finding US$63
million in savings and cost avoidance on the projected budget in fiscal year
2016. EY’s supplier program is already mature, so savings on that scale could
only be found by managing travelers.
The second reason is that getting travelers booking better
has become an urgent priority because EY is experiencing unprecedented growth.
Seventy percent of its personnel travel. The number has shot up from 140,000 in
2012 to 220,000 in 2015 and is expected to expand to 300,000 by 2020.
Communication with such a vast population is essential, and
one of the main weapons in Hutchings’ armory is Yammer. Travel is one of the
most popular groups of EY’s internal social media tool on that platform, and
Hutchings deploys a follow-the-sun approach to managing it. Travel managers
around the globe take shifts of two to three hours to monitor Yammer so the
team can meet its commitment of responding to posted queries within two hours.
Other travelers are allowed to answer the posts, but, said Hutchings, “we have
to control it because they don’t always get it right.”
She also interviews hundreds of EY’s frequent travelers
every six months to verify that the travel program continues to deliver what
they need. “We schedule 30-minute phone calls which invariably go on longer,”
Hutchings said. “In the United States alone, we have 6,000 travelers who spend
more than 100 nights a year away from home, so they are very keen to talk.” She
also engages with other key internal stakeholders like regional managing partners,
regional operational directors and executive assistants.
TMC Collaboration & Competition
Hutchings displays a similar commitment to collaborations
with suppliers and service providers, perhaps resulting from her broad
experience within travel. She began her career with 13 years at Swissair before
moving on to Business Travel International, now part of HRG. For the last
decade, she has run global travel programs at Merrill Lynch, Citi, AIG and now
EY.
When Hutchings arrived, EY firms were working with more than
100 TMCs. She wanted to consolidate, but like last year’s BTN Multinational
Travel Manager Of The Year, Volvo Group strategic purchasing manager for
marketing and travel Stephan Hylander, Hutchings did not consider it a given
that a single TMC could meet her organization’s varied needs globally, so
instead she went to tender regionally. Carlson Wagonlit Travel won the business
in Latin America and Asia/Pacific, while HRG triumphed in Europe and American
Express Global Business Travel in the United States and Canada.
Hutchings is, if nothing else, a pragmatist, so there are a
handful of exceptions to the regional carve-outs. For example, the EY firm in
Portugal retained its Portuguese TMC because it specializes in travel to
Angola, a major and challenging destination for the Lisbon office. EY also
retained the incumbent agency in Luxembourg because it stores data locally, in
compliance with strict national data-protection laws.
Among the three majors, Hutchings also imposed a unique
“co-opetition” arrangement. Amex GBT consolidates management information from
its rivals, while CWT manages the hotel and meetings program and HRG the
airline program. However, Hutchings is pushing coordination between the three
even harder.
For example, she encourages EY personnel to use Telepresence
as a substitute for travel. EY firms have Telepresence units in major offices
like Paris, Frankfurt, London, Sydney, Atlanta, New York City and Chicago. The
TMCs are working toward the ability to check Telepresence room availability,
first when the same TMC serves EY at both the “origin” and “destination” and
then when a different TMC serves each locale.
She also wants to see more enthusiasm from the TMCs. “One
TMC said booking Telepresence is not its core business and it won’t make any
money on this,” said Hutchings. “We told them we will pay for the service
because the savings will outweigh the costs.” She is encouraging her TMCs to
identify Telepresence opportunities from pre-trip reporting and then contact
travelers to urge switching to virtual meetings.
Ongoing Vendor Opportunities
Hutchings works closely with preferred suppliers, too,
promoting them heavily internally to drive more volume for the benefit of
client and vendor alike. Once again, she uses Yammer. One air supplier told her
that its offer to match EY travelers’ frequent-flyer statuses on other carriers
produced the highest engagement it had ever received.
On the hotel side, annual request for proposal negotiations
are not the only opportunity to win a place in the EY preferred-rate program.
The constant signing of new projects means the organization experiences
unexpected spikes in demand for certain cities or hotels. As a result, it often
negotiates special “project” rates, ideally including extras like laundry,
dinner or parking.
Meetings On The Management Horizon
Next up on Hutchings’ radar is meetings. EY already has
created master service agreements which have reduced average contracting time
with key hotel chains from six weeks to three days. In early 2016, Hutchings
intends to launch regional venue-sourcing RFPs to support her program’s global
rollout of Cvent meetings management technology. EY already uses Cvent in a
number of markets globally, and venue-sourcing providers will increase EY
offices’ use of Cvent as a tool to identify the meetings spend. Hutchings
realizes that this will not take hold completely during the initial rollout
stage, so for those bookers negotiating indepenently, a data-capture form
within Cvent is the minimum requirement for now.
Pragmatism Paves The Way
This compromise is yet another example of the pragmatism
Hutchings shows while balancing centralized strategies with local needs, the
eternal multinational program manager’s dilemma. “There have to be processes
and procedures implemented across the globe, and as long as they are sensible,
there shouldn’t be any issues,” said Hutchings. “It’s when those processes and
procedures cost more money than local arrangements that you can lose face. We
embrace the fact they’ve negotiated something better locally and try to make
that available to the rest of the globe.”
It’s also crucial to understand that all principles are not
universal and thus to research local conditions. The support team in India, for
example, does not pursue trainees to book flights well in advance in some Asian
countries, such as China, because fares there are likely to fall closer to
departure.
Hutchings’ instinct to approach local markets and
stakeholders as unique has served Hutchings well. “I never talk about what goes
on in the U.K. or United States when I am in Latin America or Asia,” Hutchings
said, adding that, ultimately, a global strategy must demonstrate neutrality to
be effective.
This report originally appeared in the Nov. 23, 2015,
edition of Business Travel News.