This piece below first appeared on 7th January of the Shared Services & Outsourcing Network.com (www.SSONetwork.com) website.
Building a Managed Travel Program across the Government in Singapore
By Clarence Ti, CE Vital
There is a category of emails I get in my mailbox every so often that I brace myself before I open them. This is the email that informs me that there is a Singapore government traveller at or en-route to or from a city affected by a volcanic eruption, a terrorism event, a civil disturbance. I hope, each time, it does not carry worse news.
A managed travel program earns its spurs from the way it manages crisis events. It considers the following: the number of simultaneous crisis events that can be handled? How quickly stranded travellers can be identified and contacted? Th e speed with which the travel agent works with airlines, ground transport companies and hotels to support stranded travellers? The operational tie-ups and personal connections we have in place with our embassies and consulates? Every time someone is stranded, we learn. Every time someone can’t be reached, we learn.
We review our agent’s compliments and complaints log. Every month, we categorise the complaints and look for patterns. Over the last three years, government travellers have rated our travel agent from a score of less than 50% (taken following the first 3 months after we launched in April 2008) to over 80% in 2010. The discipline in constantly reviewing our service delivery has definitely contributed to an increase in satisfaction.
While our travel agent is busy managing the day-to-day operations, the team at Vital looks after four different types of activities. First, we analyse travel patterns and based on these patterns, negotiate airline corporate rates for specific ticket types, routes and travel purposes such as scholar travel and inbound non-employee sponsored travel.
Second, we level up the program with sub-programs, such as hotel and travel insurance programs, corporate card programs for travel and procurement, taxi corporate charge programs. Third, we send out monthly travel reports and lastly, conduct regular travel education sessions for our client agencies. We have long since moved beyond just getting the air ticket. It was not until I got into this business that I could see all the behind-the-scene activities that go on in a managed travel program. They are largely invisible to the civil servant going to negotiate a trade deal or the academic travelling to present his latest discovery. It is supposed to be invisible and I hope, fervently, their names don’t come up in my email box with anything worse than an inconvenience.
The Design Choices
Some people have asked us why Vital has only one travel agent? What we do know is this - a single travel agent means that points of service failure are reduced. This means it is easier to get information, establish standard operating procedures, manage consistency of service and build understanding. For the agent, it means sufficient business volume to justify investment in people, processes and systems. For government agencies who desire to have more than one travel agent on a retainer, nothing stops them from contracting separately. In that sense, our managed travel program has to earn every customer because they can always second-source.
The second design choice is the length of the contract. A travel managed program is a high touch activity. Some of our government agencies are large enough that our travel agent has a dedicated onsite travel desk for them. Some of our government agencies routinely organise large-scale conferences, summits and international sporting events. Their needs are more sophisticated.
The customer satisfaction score being particularly low in the first year and rising over time is perhaps something to be expected for every new agent. Generally, for such contracts, a longer contract may make sense lest we have to go through the new experience curve with a new agent just when the last one has gained significant experience.
There will be proponents who will argue heatedly against long contracts and a single vendor. They have valid arguments. Each designer of a managed travel program has to make this choice when the time comes to call a new tender. They would have to weigh and balance. Local context may differ. Market dynamics may differ. The market players may differ.
The Excellence Dilemma
One last thing I would like to mention about our program is that we charge out our fees for managing the program based on a tiny percentage of airspend. It is a matter of professional pride for Vital to seek to lower costs for the close to 100 agencies who subscribe to our services. So here’s the crux -- every time we succeed for our clients to get lower rates, we get lower fees. This problem is quite common and happens every time a shared service is improved. Internally, we call this the ‘excellence dilemma’. Even the agencies who are our customers feel for us. In my mind, it's a good problem to have. I would rather solve this problem than to deal with a lacklustre program.