chicago forum final

8/3/2019 Chicago Forum Final

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Whats Next for

Travel Management?

Executive Forum - Chicago

23 June 2009


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2009 ACTE Global EducationEvent Sponsors


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2009 United States ExecutiveForum Sponsors


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2009 ACTE ChicagoExecutive Forum Sponsors


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The Future of Managed Business Travel- Recent ACTE Survey Results

Creating Innovation & Managing Change inUncertain Times

- Lean Six Sigma & Case Study Presentations

Getting to the Good Ideas- An Unconferenced Session

Agenda


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The Future ofManaged Business Travel

Kimberly Heche

Global Travel, Meetings & Events ManagementHewitt Associates

Mary Ann McNultyContent Director

ProMedia.travel LLC

Stephen MitleiderCategory ManagerTravel & Property Services Procurement

BP Corporation North America, Inc.


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Profile of Respondents

236Corporate Travel Managers


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Headquarters Location

1%

4%

5%

7%

11%

27%

45%

Middle East

Latin America

Africa

Asia/Pacific

Canada

Europe

USA

Source:ACTE


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2008 T&E Spend (not including meetings)

4%

7%

8%

17%

21%

21%

22%

Don't know

$USD $51 million to

$USD75 million

$USD $76 million to

$USD100 million

$USD $26 million to

$USD50 million

Less than $USD

10

million

More than $USD100

million

$USD $10 million to

$USD25 million

Source:ACTE


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Research Findings


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Strategic Changes Implemented(in past 6 months or more)

Source:ACTE

Reduced travel spend

Implemented more restrictive travel policies

Implemented pre-trip approval requirement

Increased enforcement of travel policies


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Opportunities for Action?


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Modified Procurement Practices and Procedures

12%

14%

21%

22%

32%

Considered, not

implemented

Expect to

implement in ne xt

6-12 months

Not considered

Implemented in

past 6 months

Implemented more

than 6 months ago

Source:ACTE


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Renegotiated SLAs with Suppliers

13%

15%

20%

24%

28%

Expect to

implement in next

6-12 months

Considered, not

implemented

Not considered

Implemented more

than 6 months ago

Implemented in

past 6 months

Source:ACTE


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Implemented Travel Technologies

8%

8%

12%

21%

51%

Considered, not

implemented

Not considered

Implemented in

past 6 months

Expect to

implement in next

6-12 months

Implemented

more than 6

months ago

Source:ACTE


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Consolidated SMM with Travel Department

9%

17%

22%

25%

27%

Implemented in

past 6 months

Considered, not

implemented

Expect to

implement in next

6-12 months

Implemented more

than 6 months ago

Not considered

Source:ACTE


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Whats Next?

Impact of mobile development

Usage of travel alternatives

Increased data consolidation capabilities


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Lean Six Sigma

Creating Innovation & Managing Changein Uncertain Times

Stephen W. ElliottProcess & Innovation Performance

Accenture


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Objectives

Introduce Lean Six Sigma (LSS) Concepts

Describe results achieved

Discuss applicability to travel management programs


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What have you heard about Six

Sigma, Lean and Lean Six Sigma?


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Great

What have you heard about Six

Sigma, Lean and Lean Six Sigma?

Rigid

Complex

Hard

NeedMath

Not forServices

DrivesValue

It Works!


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Most Every Organization is Driven to Quality,

Cost and Lead Time Reduction Goals

Customer loyalty and retention

Shorter customer lead time demands Downward price pressure: lower costs

Lower invested capital

Capacity expansion


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ProcessO

utputs W

hat CustomersW

ant

Y


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Process Inputs Items to Control

f(X) = Y


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Lean Six Sigma Methodology and Approach:

Customer defines level of performance Focused on improving (and managing) critical process

inputs rather than just outputs (sales, profits, etc.) Y=f(X) Repeatable methodology to address process opportunities

[Define Measure Analyze Improve Control (DMAIC)]

Engaging Leaders: Project selected specifically to support business objectives Defined organization and set of roles creates accountability Critical mass of resources trained and deployed on the real

business-critical projects


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Lean Six Sigma Improvement Process

DefineDefine

MeasureMeasure

AnalyzeAnalyze

ImproveImprove

ControlControl

Define the opportunity from bothbusiness and customerperspectives

Search for the key factors (critical Xs) thathave the biggest impact on processperformance and determine the root causes

Understand the processand its performance

Develop improvementsolutions for the criticalXs

Implement thesolution and controlplan


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Maximizing the Results Requires Lean (Done

Fast) and Six Sigma (Done Right) Together

Goal Reduce waste and increaseprocess speed

Focus Bias for action/ Utilizeexisting, proven Lean Tools

Method Kaizen events, ValueStream Mapping

Goal Improve performance onCritical Customer Requirements

Focus Use repeatable DMAICapproach for sustained results

Method Intense focus on projectsperformance improvement a key

leadership activity

Six Sigma

Quality, Cost +

Explicit Approach

Lean

Speed + Waste +Implicit Approach

Lean Speed EnablesLean Speed EnablesSix Sigma QualitySix Sigma Quality(Faster Cycles of(Faster Cycles ofExperimentation/Learning)Experimentation/Learning)

Six Sigma Quality EnablesSix Sigma Quality EnablesLean SpeedLean Speed(Fewer Defects Means(Fewer Defects MeansLess Rework)Less Rework)

X


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Lean Six Sigma

DMAIC Improvement Process Road MapImproveImprove

Project Charter

Voice of theCustomer andKano Analysis

SIPOC Map

ProjectValuation/ROICAnalysis Tools

RACI and QuadCharts

StakeholderAnalysis

Communication

PlanEffective MeetingTools

Inquiry andAdvocacy Skills

Time Lines,Milestones,and Gantt Charting

Pareto Analysis

Belbin Analysis

Value Stream Mapping

Value of Speed(Process CycleEfficiency/Littles Law)

Operational Definitions

Data Collection Plan

Statistical Sampling

Measurement SystemAnalysis (MSA)

Gage R&RKappa Studies

Control Charts

Histograms

Normality Test

Process CapabilityAnalysis

Process Constraint IDand Takt TimeAnalysis

Cause & EffectAnalysis

FMEAHypothesisTests/Conf. Intervals

Simple & Multiple

RegressionANOVA

Components ofVariation

Conquering Productand ProcessComplexity

Queuing Theory

ReplenishmentPull/Kanban

Stocking Strategy

Process FlowImprovement

Process Balancing

Analytical Batch SizingTotal ProductiveMaintenance

Design of Experiments(DOE)

Solution SelectionMatrix

Piloting and Simulation

Mistake-Proofing/Zero Defects

Standard OperatingProcedures (SOPs)

Process ControlPlans

Visual ProcessControl Tools

Statistical Process

Controls (SPC)Solution Replication

Project TransitionModel

Team FeedbackSession

AnalyzeAnalyze Control ControlMeasureMeasureDefineDefine

Kaizen, 5S, NVA Analysis,

Generic Pull Systems,Four Step Rapid Setup

Kaizen, 5S, NVA Analysis,

Generic Pull Systems,Four Step Rapid Setup

Identify and Implement Quick Improvements with KaizenIdentify and Implement Quick Improvements with Kaizen


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W

hats LSSW

ithout Some Statistics?

80706050403020100

20000

10000

0

AVERAGE DIALS

R

EVENUE

S = 1854.53 R-Sq = 2.5 % R-Sq(adj) = 2.4 %

Avg. FF Rev. = 365.467 + 24.4076 Avg Dials /D

Outbound Calls as Predictor of Revenue

Problem-

Background

Approach

Results


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Process Perspective Value Stream Map:

81% of Steps Are Non-Value Add Waste

Q

MGFinanceManager

50 minC/T 6 min

Q

KBClerk

184 min5 min

Sales Order

PocketPonyInc.

Q

10 minC/T 0 min

10 min

Customers

Fancy CarriageCompany

Prod.Depts. 240 min

KSContractsManager

CT 15 min

Q

125 min

C/T 20 min

20 min

Q

120 min

JWAssistant

60

120

15

BKProgramAdmin.

Q

195 minCT17min

MPAssistant

Q

53 min5 min

8

45

10 min

Q 155 min

C/T 22 min

22 min

C/T 8 min

Q

103 min

68

35

C/T 2 min

163 min

Q

945 min

195

480

270

25 min

Q 90 min

C/T 53 min

40

50

5 min

Q 35 min Q 50 min

5 min

10

40

This Paper Copyright 2001 by Lockheed Martin Corporation. All rights reserved.Portion Copyright etc. 1997-2001 by Lockheed Martin Corporation. All rights reserved


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The Perfect Process

MGFinanceManager

C/T 6 min

KBClerk

5 min

Sales Order

PocketPonyInc. Customers

Fancy Carriage

Company

Prod.Depts.

FileAway

KSContractsManager

CT 8minC/T 20 min

20 min

JWAssistant

BKProgramAdmin.

CT17min

MPAssistant

5 min

Eliminating Non-Value Add Steps Reduces Lead Time

from 1440 to 61 Minutes and Eliminates Waste


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AllEmployees

Understand vision Apply concepts to their

job and work area

Business Leaders Own vision, direction, integration, business results Lead change, provide strategic direction

Sponsors Own financialresult

Project/Processowner

Create Charter Support team Sustain

solutions

Black Belts Lead more complex projects Train and coaches Project Teams Serve on projects across the

enterprise Go To subject matter experts

Mentor Green Belts

Green Belts Provide project specific Support Gather Data Provide Subject Matter Expertise Provide Input for Solution Help Pilot, Test, Implement

Solution

Champions

Leadperformanceimprovementwithinsite/businessunit

Prioritizeprojects

Manage ProjectPortfolio

ProjectSponsors

ExecutiveExecutiveLeadershipLeadership

DeploymentDeploymentLeadersLeaders

Project Leaders

Roles for LSS


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Carlson Wagonlit Traveland Six Sigma

Quality and Customer Experience

Steve WilliamsonSix Sigma Black Belt

Director, Quality & Customer ExperienceCarlsonWagonlit Travel

CWT - Copyright 2009 CWT


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Why CWT Adopted Six Sigma

To elevate our knowledge of a process and understand: Human and technical aspects

How process components interact with the overall vision and mission

Key Processes Drive Results

ProcessesDrive

Customer Satisfaction

ProcessesDrive

Cost Savings

If we dont measure it, we cant control it.

If we cant control it, we cant improve it.CWT - Copyright 2009 CWT


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Stages of Improvement

What Six Sigma Methodology Reveals

What you think

it is

The actual

process

What it should

be

What it could

be



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Best Practices - Results

Example 1:A prominent, global pharmaceutical companywith North American air spend of $80 million sought flawless

execution throughout the implementation process and reliedupon CWT to ensure success.


The clients critical-to-quality metrics

were achieved immediately upon programstart-up.


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Example 2: To ensure it was receiving the lowestavailable fare at point-of-sale, a financial services leader

with $75 million in North American air spend sought a fullTopaz audit.


CWT delivered the lowest fare 99.14% of the time,exceeding the clients goal.

Subsequently, audits for two other companiesachieved scores of100% using these established

processes.


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Example 3: A global technology leader waschallenged with a significant number of unused

tickets when moving to CWT from the previoustravel management company.


The client was able to secure more than

$4 million for future use through

CWT automation and negotiations.


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The Race for Quality Has No Finish LineQuality



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Six Sigma

in Allstate Corporate TravelMarie Colby

Six Sigma Black Belt

Senior Commodity ManagerTravel Enterprise Services

Allstate Insurance Company


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Todays Dialogue Allstate Six Sigma Evolution

Overview of Allstate Travel

Compliance Measures

Preferred Hotel Process Improvement Business Unit Focus

Voice of the Customer

Savings Opportunity

Brainstorming Solutions

Next Steps

Questions


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Allstate Six Sigma HistoryProgression of Six Sigma at Allstate

Introduced as a pilot in Allstate Financial in 2001

Integrated into Allstate business units

The Six Sigma methodology helps us to more effectively define the problem,collect performance data, analyze root causes, select the right solutions andensure that the improvements are maintained."

Evolving Six Sigma in Procurement

Endorse Six Sigma for process improvements in Procurement in 2006

Train additional Black Belts (4) to continue to drive Six Sigma processimprovements within Procurement

Maintain corporate responsibility to foster participation in other departments

Utilize Six Sigma as a consultative design tool for new processes

Six Sigma Enterprise COE


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Overview of Allstate TravelGuidelines established to manage traveler behaviors:

Request travelers make air, hotel and rental car reservations

through online booking tool (Allstate Travel Xpress - ATX) ordesignated travel provider

Purchase all airline tickets at least 14 days in advance

Purchase the lowest available non-refundable coach classfare for domestic flights

Competitive rates established for preferred hotel program Ensure the safety of all employees while traveling


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TravelServices

AspirationRange

AllstateCompliance

Online Booking Tool

85% 85%85%

Air:14Day Advance 85% 80%

Air: Low FareAcceptance

95% 98% 85.2%

Air: Ticket Exchanges 6% 10%15%

Preferred Rental Car 90%75%

Preferred Hotel 60%- 70% 43.9%

Compliance Measures


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Preferred Hotel Process Improvement

Initially seen as a way to increase compliance for the Allstate Preferred Hotel program,this became an opportunity to examine our internal customer buying habits, listen to

the VOC and design a program to meet their ever changing needs.

Create a more

simplifiedprocess byanticipating what

and howcustomerspurchase


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Preferred Hotel Business Unit Focus

Speciality

Operations

P&CRe

gionalO

ffice

Claim

s

Marke

ting

LawandRe

gulation

IndAgent

Marke

ts

Human

Resources

Financial

Sha

redSe

rvice

s

CorporateR

elations

Facility

Services

&RE

Allst

ateFin

ancial

100.0%

80.0%

60.0%

40.0%

20.0%

0.0%

Business Unit

IndividualValue

_

X=40.9%

UB=100.0%

LB=0.0%

60.0%

I Chart of % Compliant - August 2007 - August 2008

Spend M 0.37 0.2022.70 6.18 3.10 1.30 1.18 0.46 0.44 0.40

Percent 1.0 0.662.5 17.0 8.5 3.6 3.2 1.3 1.2 1.1

Cum % 99.4 100.062.5 79.5 88.0 91.6 94.8 96.1 97.3 98.4

Business Unit

Othe

r

Finan

cialS

haredService

s

Human

Resources

CorporateR

elations

Marke

ting

IndAgentMa

rkets

Law

andRe

gulat

ion

Allst

ateFin

ancial

P&CRe

gionalO

ffice

Claim

s

25

20

15

10

5

0

Spend

M

Pareto Chart of Business Unit Spend Per Million - Aug. 2007 - Aug. 2008

Opportunities exist for larger spend business units; historically hotel decisions havenot been based on Allstate preferred properties, but traveler convenience.


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22%

10%

30%

38%

Preferred Sold OutNo Hotel in DestinationPreference NotOfferedLower Priced Option

No preferred hotel intraveler destination wasthe top reason for notchoosing a preferred

property

Only 44% of Allstatebusiness travelers makereservations via online

booking tool ordesignated agency

Voice of the Customer

44%

6%

18%

14%18%

Travel Agency/OBT InternetWebsiteHotel Direct HotelWebsiteOther


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Brid

gewa

terN

J

Irving

TX

NashvilleTN

Charlotte

NC

HAUP

PAUGE

Area

NY

Metiare

/Ne

wOrlea

nsLA

HomeO

ffice

Area

IL

Atlan

taAreaG

A

Lake

MaryFL

Anahiem

AreaCA

Phoenix/Me

saAZ

1500000

1000000

500000

0

-500000

-1000000

City State

Individ

ualValue

_X=239010

UCL=1319862

LCL=-841843

Savings Opportunity Between Property Website & Preferred Rate

Bridgewa

terNJ

IrvingTX

Nashville

TN

Charlot

teNC

HAUP

PAUGE

Area

NY

Metiare

/Ne

wOrle

ansL

A

HomeO

ffice

AreaIL

Atlan

taAreaGA

Lake

MaryFL

Anahiem

Area

CA

Phoenix/MesaA

Z

1500000

1000000

500000

0

-500000

-1000000

City State

Individ

ualValue

_

X=307520

UCL=1615716

LCL=-1000675

Savings Opportunity Between Internet Rate & Preferred Rate

Preferred Hotel SavingsO

pportunity

The missed opportunity ranges $2.6M and $3.4MAnnually

Saving Opportunity = (57% of Annual Room Nights ) x (Price Variance to Preferred Rate)


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Identified our problem statement and brainstormed the causes andeffects the booking process could have on the preferred hotel program

Potential Causes and Effects


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Solution Impact

Solution Potential ImpactEliminate Preferred Hotel Program No knowledge of traveler

location/Lost dollars

Internet booking on tool/addinternet bookings to itinerary

No punch out on tool/add totransaction fee

Primary/Secondary Preferred

Agency Rate

Negotiated savings/ earn

commissionable rates. Identify rateby hotel for tracking.

Mandate use of online bookingtool/agency

Ensure safety of our travelers


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Quick Wins

Description in online booking tool

Low term rates for CAT team for specified chain properties Clarification of Allstates Safety team position on travel

Next Steps Control Phase

Standard practices enhanced processes

Training

New guidelines and compliance goals

Compliance monitoring and measuring

Communication of results and recommendations

Next Steps


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Getting to the Good Ideas

an unconferenced session

Facilitated by: Harriet WashburnManager of Strategy and Sourcing

IBM


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Topics forDiscussion Who owns travel procurement?

How do you define the end-to-end process?

Incorporating social networking tools

What is your mobile strategy?

Pros & cons of a global TMS vs. best-in-class localsuppliers

KPIs for effective travel management programs

How do you respond: better, faster, cheaper on theinternet


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