Quick – name three metrics that travel managers care most about…and no, you can’t say savings, savings and savings.
Savings, for sure, maybe followed by discounts and policy compliance, or average ticket price/room/car rate. These are time-tested, industry-accepted, common-sense metrics that are the foundation for status-quo management of the travel category.
(Going to GBTA’s Convention? See a related meet-up note at the end of this post)
Before you reject my call to demote these traditional metrics, consider the maxim “Measure what matters”. Note that it isn’t “Measure what’s laying around, looking like it matters”. It’s not “Measure what we’ve always measured”.
It’s the “what matters” part that’s the key. That, and an evolved view of travel management’s mission.
Shouldn’t the goal of managing travel be to create the most value from whatever the travel budget is? To create the biggest business impact, net of the cost? Sure…which means we need to think about measuring said impact.
But not in an egg-headed, PhD, ROI kind of way…nobody knows how to do that. Let’s keep it simple, practical, doable.
Which means thinking about the measurable impacts we want from a travel program. And no, we’re not talking about online adoption rates or lowest-logical fare compliance rates…those don’t meet the bigger-picture criteria of having measurable Business Impact.
Let’s start with the travelers. Surely they are the most important part of any travel program. Road warriors are the most important group among all your travelers. They account for most of your program’s transient spend. They are well-paid to build relationships or bring their expertise to where these things are needed. You don’t want to lose them, especially to the competition.
So whatever Business Impact thingies we measure, we need to put road warrior-related metrics in the center. Now we’re getting somewhere.
Assume for the moment we end up wanting to measure business impacts of a travel program on these dimensions (RW stands for road warrior):
- RW recruiting and retention, e.g., time to fill open jobs, attrition rate, etc.
- RW productivity, measured in sales, billable hours, etc.
- RW willingness to travel over the next few months and years
- RW’s trip scrap rate – the share of trips rated as not worthwhile (btw, the average is 12%)
- and yes, of course, a clear measure of procurement’s value-add.
Notice that each of these dimensions is directionally obvious. You know if you want more, or less, because you can tell if having more helps the business, or hurts it.
Here’s the bright, shiny point – none of our traditional travel KPIs measure any of these business impact dimensions. We’re not measuring what really matters. Surprised? I was.
Test this by asking “How does knowing my program’s average discount (or savings, or compliance rate) tell me anything about how well our program is doing along any of these important dimensions?”
They don’t. They can’t. That’s not what they are meant to measure.
Agreed, there is no harm, and a bit of good to be had from measuring traditional travel metrics…but please don’t believe that those typical metrics are any good for measuring the core business impact of a travel program.
We need new metrics and a new framework. I’ll expand on this in my session “Advanced Airline Sourcing For Strategic Impact”. It’s Tuesday, July 19th at 11:30 am at the GBTA Convention in Denver.
For those of you going to GBTA, you’re welcome to meet for drinks and apps with Kimberly Meyer (Meetings Analytics), me and other like-minded travel industry folks who dig data served with truth and clarity :> We’ll be at the Embassy Suites across from the Convention Center Monday from 6-ish to 7-ish pm.
Hope to see you in Denver. If you’d like a copy of my presentation, just leave a note below.
As always, very insightful Scott. It will be a great discussion at GBTA!
Thank you, Karen – hope to see you there!
Great topic Scott. The 3 that came to my mind immediately were safety, productivity and enhancement to the business objective of the trip. That would include on-time performance, access to Wi-Fi,connections that work,and of course safety is implied. To save $50 on a fare and not have Wi-Fi or arrive late costs 10X or more to the company. You’ve summarized that with Value
Andy, you work with a lot of travel managers…how do you see them measuring safety, productivity and business impact? My sense is they agree on principle that these are important dimensions, but lack the data to report on them. Any bright lights out there?
The lights are not bright but i can see them at the end of the tunnel. Safety is a function of the internal approval of non-US airlines. within the US it’s not an issue. Productivity is the amount of time it takes to get to/from your destination and how much work (if any) you get done on the trip (plane, ground transport, hotel). i travel over flights a year, and the metrics I use include: Clubroom time at the airport, Wi-Fi on board, time from airport to hotel and ergonomics of the hotel room. to my knowledge no one has quantified this, but using the example given, i can see an opportunity to pick up 3.5 -7 hours of productivity based on the suppliers and their performance. in consulting (as you know Scott) just multiply that # hours by the billable rate.
Interesting. I wont be attending GBTA but would love a copy of the presentation.
Thank you, Sharon, I’ll send you a copy in late July.
Yes please to the copy of the presentation. I like your work / style and wont be in Denver.
Many thanks James
Glad you like the style, here, James! You bet, I’ll send you a copy right after GBTA.
Great Article Scott as always! I will see what calendar allows for drinks in Denver, if not we will cross paths on Tuesday at your session.
Sounds great, Chris, and thanks for your nice note on LinkedIn!
Agreed, this is a great topic. Would love to see a copy of your presentation. Looking forward to the Denver event!
Terrific, Charlie – hope to see you and Dan in Denver!
Hi Scott – interesting insights! Would appreciate a copy of your presentation
Regrettably I am unable to attend GBTA in person
Have a great conference!
Paul, thanks for taking an interest here. I’ll send you a copy shortly after the GBTA event is over.
Interesting article….would love to see the presentation!
You got it, Melissa, will send a copy in a couple of weeks…hope you’ll share it with your colleagues at BCD!
Interesting …. pl share copy of presentation
Of Course, Chandresh…look for your copy in a few weeks, and thanks for your interest!
Great article. I can’t be in Denverr so yes please send a copy of the presentation !! thanks
My pleasure, Celine, and thank you for your interest in this way of thinking about corporate travel programs!
Look forward to seeing you and hearing more given we are still chasing the traditional metrics associated with policy compliance.
Likewise, Bill -it will be good to catch up! Wait till you see the research from a new study on this very topic…it will be published on Monday morning at GBTA….eye-opening stuff!
Smart analysis to revamp T&E KPIs.
If possible interested to get the presentation.
Thank you for your interest in this approach, Christophe. I’ll send you a copy, and will be interested in your thoughts about how it may apply in the public sector.
I’m unable to attend GBTA this year. Can you please send me a copy. Thank you!
With pleasure, Erin – thanks for your interest in this approach!
Scott – Unfortunately, I can’t attend GBTA, but would like to see your presentation afterwards and any follow up that’s available. Maybe you can host a GBTA webinar afterward, just a thought.
What a good idea, Carol! I’ll send you a copy in any case.
Fresh perspective! Please send a copy of the presentation. Thank you.
Will do, Dorothy!
Won’t be able to make it to Denver from here in Geneva but would love to see a copy of your presentation. Always insightful!
No worries, Paul, I’ll send you a copy, and will look forward to your feedback!
Really interesting! Thank you very much! I cannot attend GBTA, but I would really appreciate a copy of your presentation. Thanks a lot!
Thank you, Silvia, for your interest! Look for a copy within 2 weeks.
Thank you Scott – very interesting article – would love a copy of the presentation as well – enjoy Denver!
Hi Virginie, sorry you won’t be there, and you bet, I’ll send you a copy.
As always, you impress and inspire me! See you at GBTA dear Scott!
Thank you very much, Monique! Looking forward to seeing you in Denver!
Regrets as I will not be attending GBTA this year. I will also miss your good session, if you can email me :firstname.lastname@example.org and send the copy of the presentation. Thank you,
Hi Dila, you’ll have it shortly after GBTA – happy reading!
Enjoyed your article. Won’t be at GBTA but would love a copy of your presentation. Thanks for offering!
You’re welcome, Lisa! I’ll get a copy to you shortly after GBTA.
Being in business development for a TMC I would love to see the presentation and see where I can tweak my pitch. I am always trying to sell on the value and benefit the overall company will receive by working with us versus the transactional dollar amount the save or typical KPIs..
For sure, Christy, there is a lot more value to be created by a TMC when it focuses on the bigger picture. Hopefully buyers will seek out those TMCs that understand this, and pay them accordingly. I’ll send you a copy of the presentation, and will look forward to your comments.
Your perspective is always insightful and forward thinking!
Thank you, Jess – glad this gets you thinking along these lines!
Hi Scott, I won’t be attending GBTA this year either (budget restraints) but would really like to see a copy of your presentation. I do believe your viewpoints on what really should be measured is important!
I’m sorry to miss you at GBTA, Barbara. Look for a copy shortly after GBTA, and please let me know your thoughts.
Would love a copy of the presentation. Definitely support the idea and would wholeheartedly like to leverage any practical advice. Sorry I missed GBTA now! Thanks!
Great article……I cant attend the convention in Denver, stuck in Saudi. Can you send me the presentation?
How can a travel manager go about implementing and gathering data on these new metrics? Is it through extensive surveys? As a traveler, I hate surveys. Is there any way to extract this data without them??