Why have corporate travel managers become so prone to inertia and averse to innovation in recent years? Why are numerous companies spending millions of dollars more on travel than necessary? Is it time for the travel manager’s job description to change?
I’ve been trying to find answers to these questions since I dedicated myself to travel education and training this summer, through my “On the Fly” Seminars and the Kralev International advisory services.
But it was a post by Scott Gillespie, who writes a blog on procurement and corporate travel management, that prompted me to air my thoughts in public. Although my arguments aren’t quite what he had in mind, I was happy to see that others share my concerns about corporate complacency.
Why do I feel qualified to pass judgment? Because I almost always pay the lowest coach fares, but I haven’t sat in coach since 2002 — and I’ve flown nearly 2 million miles and visited 38 states and 82 countries. And because this year, I’ve flown 100,000 revenue miles, for which I paid a grand total of $747. I’ve never admitted this publicly before, although friends have repeatedly urged me to use it as a selling point — I just didn’t think anyone would believe it. That’s why I’m writing a book, so I can explain it.
I’ve been shocked by how many companies still rely on large travel agencies without almost any meaningful supervision. I’m not suggesting that they stop using travel agents, because this may be the only way to handle high volume. The problem is that, in many cases, they are not getting the cheapest available tickets — but they don’t know it.
Why does that happen? One reason is that many travel agencies have lucrative contracts with certain airlines that encourage them to send more business their way. If your agency receives its biggest commission from American Airlines, it will likely book you on American even if United Airlines has a lower fare. Did the agency disclose any of this before you signed a contract?
The other reason is much less obvious, but hopefully this column will change that. While technology and automation are enormously useful and efficient, they discourage us from using our brains. Automation is no doubt vital for the travel-booking process, but the extent to which travel agents rely on computers to tell them what to do is stunning — and it costs your company a lot of money.
Let me give you an example. Last year, my former managing editor at the Washington Times had to go to Mongolia at a week’s notice and asked if I could find an affordable business-class fare. The cheapest ticket from Washington to Ulan Bator we could find — both from a travel agent and online booking engines — was about $8,700, which was out of the question.
So I started thinking outside the box and decided to try splitting the fare — if I could get a much lower business-class fare to a northeastern Asian city where one would connect on the way to Ulan Bator, I’d book the short haul in coach. Sure enough, I found a $3,250 business-class ticket to Beijing on Air Canada, and coach on to Ulan Bator on Air China for about $550. Both carriers are members of the global Star Alliance.
While any company most likely would have paid $8,700, I saved almost $5,000 — and it took me 15 minutes to do it. When was the last time your travel agent did that? I’m not suggesting that splitting the fare makes sense every time, but there are other creative — and legitimate — ways to save money that computers are not yet fully capable of mastering.
There are also things you can do to help your travel agency save you money. One of the services I offer is strategic travel planning. What does that mean? If you have more than one trip coming up, why not plan them at the same time? You don’t have to take them together — in fact, they can be months apart.
Several months ago, I had a client in Washington who wanted to go to Paris in the spring and to Buenos Aires in the fall. I knew that coach fares from Europe to South America are generally lower than fares from North America, so I suggested an unconventional way of booking two tickets simultaneously — one originating in Washington and the other one in Paris — and the savings exceeded $800. I won’t bore you with further details here, but send me a message if you’d like to know more.
How do you think most travel managers respond when I offer to train them and anyone in their company who might book travel directly? Some say their travel agency already takes care of all their needs and there is no reason to rock the boat. Others are unhappy with the travel agency, but they don’t have money to invest in learning how to save much more money. Yet others don’t seem to understand what exactly I can do for them.
Last week, a friend in Phoenix recommended my services to his company’s travel manager. The response was that, “due to budget cuts to travel budgets and their departmental budget, they felt that they could not justify the expenditure right now.” No comment.
In June, a business-development specialist from a Washington law firm took one of my seminars and saved $500 on her first ticket, so she recommended to the firm that I train their executive assistants who book travel for the attorneys. Management, however, saw things differently. “We have an agreement with American Express, so bringing you in would conflict,” they said.
I asked how exactly that would represent a conflict, since I wasn’t offering to book tickets for them, but I never received a response.
Nor did I hear back from the Association of Corporate Travel Executives, having contacted Megan Costello, then-acting executive director, Kate Farrell, senior director for global education, and Amber Kelleher, director for global education, three months ago. I suppose they have better things to do than listen to new ideas that can actually benefit their members.
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Continue reading about Corporate travel’s lack of innovation
If anyone had any doubts that putting together the European Union’s new diplomatic service would be an utterly messy task, that is now an undisputed fact. A high-profile ambassadorial list released this week provoked publicly aired quarrels rather uncharacteristic of diplomats, and it raised questions about the future effectiveness of the EU corps.
The long-anticipated list, unveiled by EU foreign policy chief Catherine Ashton in Brussels, was apparently based not on merit, but on what Polish Foreign Minister Radoslaw Sikorski called “esoteric considerations.”
What are those? A quick look at the list shows that the most important ambassadorships are going to diplomats from the oldest EU members in the West — China was given to the Germans, Japan to the Austrians and South Africa to the Dutch. What about less important but plush posts? Of those, the Spanish got Argentina and Singapore went to Luxembourg.
So the considerations Sikorski referred to had more to do with where the diplomats come from, rather than what they can accomplish in their respective positions. “Appointments should be made on merit,” he said. “We in the new member-countries have people who speak the languages of the former Soviet Union, we have expertise there.”
Four posts out of 29 went to diplomats from Central and Eastern Europe. Despite Sikorski’s protest, Poland did better than any other former communist country, winning South Korea and Jordan. The Bulgarians got Georgia, and Afghanistan had gone to the Lithuanians earlier.
“I have appointed the best people for the right jobs,” said Ashton, whose official title is EU high representative for foreign affairs and security policy, as well as vice president of the European Commission, the EU’s executive body. She was also criticized for choosing only eight women.
“We have made a start to address the important issues of geographical and gender balance,” Ashton said in an apparent admission that those problems are not yet resolved.
The nominees, who have to be approved by the European Parliament, may be the “best people” for the jobs from their country, but it’s questionable whether they are the best from any EU state. It’s not clear, either, that the top criteria during the selection process were actually skills, qualifications and experience.
“We are deeply disappointed,” said Slovenian Foreign Minister Samuel Zbogar. “We expected more transparent decisions and that geographic balance would be taken into account, in particular for those states, like Slovenia, which have no presence at all in the EU’s foreign institutions.”
Creating the European External Action Service — the diplomatic corps’ official name — is a daunting task, and Ashton has an impossible job. She won’t be able to please everyone even if she really wants to. But more consultation with Eastern European members would go a long way.
If there is hostility among diplomats from different countries even before the foreign service’s launch, which is expected in December, it will likely affect trust and their ability to work together at the dozens of missions they are setting up around the world.
Here is the full list released by Ashton’s office on Wednesday:
China — Markus Ederer (Germany)
Japan — Hans Dietmar Schweisgut (Austria)
South Africa — Roeland van de Geer (Netherlands)
Afghanistan — Vygaudas Usackas (Lithuania)
Albania — Ettore Sequi (Italy)
Argentina — Alfonso Diez Torres (Spain)
Macedonia — Peter Sorensen (Denmark)
Bangladesh — William Hanna (Ireland)
Jordan — Joanna Wronecka (Poland)
Uganda — Roberto Ridolfi (Italy)
Senegal — Dominique Dellicour (Belgium)
Angola — Javier Puyol Pinuela (Spain)
Botswana — Gerard McGovern (Ireland)
Burundi — Stephane de Loecker (Belgium)
South Korea — Tomasz Kozlowski (Poland)
Gabon — Cristina Martins Barreira (Portugal)
Georgia — Philip Dimitrov (Bulgaria)
Guinea-Bissau — Joaquin Gonzalez-Ducay (Spain)
Haiti — Lut Fabert-Goossens (Luxembourg)
Lebanon — Angelina Eichhorst (Netherlands)
Mozambique — Paul Malin (Ireland)
Namibia — Raúl Fuentes Milani (Spain)
Pakistan — Lars-Gunnar Wigemark (Sweden)
Philippines — Guy Ledoux (France)
Singapore — Marc Ungeheuer (Luxembourg)
Chad — Helene Cave (France)
Zambia — Gilles Hervio (France)
China (Deputy) — Carmen Cano de Lasala (Spain)
Papua New Guinea — Martin Dihm (Germany)
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Secretary of State Hillary Clinton this week accomplished a diplomatic feat that her immediate predecessors tried but failed repeatedly to pull off: visiting South Korea, but skipping Japan and China on the same trip. It may sound immaterial, but defying protocol is a tricky thing in diplomacy, especially in Asia.
For years, I’ve been very amused when the State Department would send us in the traveling press corps a note about the secretary plans to visit just South Korea or just China or just Japan. Every time, I’d smirk and bet that he or she would end up going to all three countries — and I was right. That had become a tradition — the Japanese in particular considered it an affront to be ignored by their staunchest ally in favor of Seoul or Beijing.
In early 2008, Condoleezza Rice had to go to South Korean President Lee Myung-bak’s inauguration, and initially had no intention of stopping in Tokyo or Beijing. But after diplomatic pressure from both capitals, she caved in. I skipped Tokyo on that trip.
Clinton herself fell victim to protocol in May. She had to co-chair the so-called U.S.-China Strategic and Economic Dialogue with Treasury Secretary Timothy Geithner in Beijing, and to drop by the 2010 Shanghai Expo in Shanghai. For months, her aides said that no other stops were planned, but in the end, she went to Japan and South Korea, too.
It seems that this time Clinton successfully defied protocol. It helped that she met with her Japanese and Chinese counterparts at the annual meeting of foreign ministers from the Association of Southeast Asian Nations (ASEAN) in Vietnam. But I have little doubt that, in spite of those meetings, the Japanese and Chinese still lobbied for her to drop by their capitals.
By the way, this ASEAN meeting was the first I’ve missed in years. I always thought attending a high-level summit in Southeast Asia in late July was a misery because of the very hot and humid weather, but DC is much worse these days.
Continue reading about Clinton pulls off diplomatic rarity in Asia
Trying to figure out how airlines determine fares is utterly futile, but that doesn’t necessarily dampen my curiosity. On a recent visit to the Star Alliance headquarters in Frankfurt, I sought insights into how the global group sets its popular round-the-world fares.
I always enjoy dropping by the alliance’s modest office — not only because it’s an easy walk from the airport terminal, but also because just about everything it does is unique and pioneering in the industry. With 27 member-carriers, one would think it’s a grand operation, so I was surprised that fewer than 80 people work there.
As regular readers of this column have no doubt noticed, I’m a fan of airline alliances. Skeptics often point out the potential negative impact on competition and fares, but government regulators have designed mechanisms to maintain fair practices. Obviously, airlines have formed groups like Star, Oneworld and SkyTeam to boost their business, but, as I’ve written before, what is good for a company doesn’t necessarily have to be bad for customers… MORE
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If you ever wanted to sit in first or business class but couldn’t afford it — and upgrading wasn’t an option — your time may have arrived. While airlines await the return of paying “premium” passengers, some of them are letting lower-class fliers occupy plush lie-flat seats.
On Australia’s Qantas Airways and Germany’s Lufthansa, you can now sit in first class even if you hold a ticket for business — no miles or other upgrade instruments are necessary. Qantas also allows coach customers in the business cabin.
The two carriers still offer standard three-cabin service on most of their international networks. However, earlier this year, Qantas decided to stop selling first-class tickets on some routes where demand had slumped. While it pondered the wisdom of removing those seats, it made them part of business class…
Continue reading about Airlines cut back on first-class service
