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Posts Tagged ‘travel procurement’

Travel Procurement: A Lost Cause?

Posted in Frown, tagged on January 20, 2011| Leave a Comment »

For many who own a slightly higher tiered credit or charge card in the city, they get to enter the Plaza Premium lounges at the Hong Kong International Airport while waiting for boarding.  Obviously it’s no The Wing, The Pier, The Cabin and The Arrival lounges operated by Cathay Pacific for its loyal customers, but over the years I have seen it revamping into a much improved product since inception. 

The lounge is heavily visited since it began to serve other airlines when CX either closes their doors or is simply too expensive for them.  I don’t know whether it’s mob mentality, but patrons here are generally not paying  hefty buffet charges.  Why are they devouring their food?  Sure there must be starving passengers somewhere who have been stranded for hours, but there is simply no point jamming in all those stale salads and sandwiches.  And what’s the deal with stuffing all those sodas and bottled waters in their carry-ons?

This reminds me, air travel is still considered a chore these days.  Surely it has been glamorized by fancy new seats and upper class cabins, but for the majority, cramming into those 3-4-3 economy seats for 6 to 14 hours is a nightmare.  No elbow room, no leg room, hardly any service, crying babies, rude passengers, smelly neighbors, long lines at the toilets, malfunctioned entertainment units, hardly covers all that to dread for.  Not to mention the multiplied misery if it is a business trip.

That explains why patrons at the airport lounges behave like inmates ready for detention.   To add-on, airports are notorious in charging exorbitant prices on food that is far below mediocre in city’s standards, and travelers just have to make do with anything free.

So this is all about supply and demand.  Since air travel is almost the only mode of transportation internationally (at least for most of Asia), the airlines can pretty much dictate what service levels they will provide or what food they serve.  The airports can make profits from their captive customers, and anything related to air travel including airport limousines, express railways and taxis are all entitled to charge much higher fees.

With that huge demand over limited or even monopolized supply, anyone who believe negotiations over price discounts, bonus offers or upgrades in the travel industry can produce material results, are seriously mistaken.  It’s still better than not doing anything, if the purchasing volume is sizable.  However, the results are not going to help you make any significant numbers. 

That’s why I prefer to leave travel procurement to my capable teammates, while I focus on reviewing the travel policy with our CEO.   Don’t expect miracles to happen there either, because as far as business travel welfare is concerned, I will never see the CEO picking the lounge where I am at today, over the champagne and caviar that he gets to enjoy on board.

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Company Travel 101

Posted in Frown, Grin, tagged on December 2, 2010| Leave a Comment »

For almost any regional corporate employee one of the first things they ask is the company’s travel policy.  To many executives who are in the air over 30% of their time, this policy directly affects their very well-being.   Some even ask about it during job interviews so that they can size up the opportunities as part of their consideration.  Again, may I remind everyone that the travel policy is the collective work of company’s top management, human resources, finance and security.  Procurement is only asked to come in afterwards to negotiate the best travel deals for the company, based on set upon travel policy guidelines, and available budget.   We always get blamed or bombarded with complaints and questions from everyone, from secretaries to heads of businesses.

Am I entitled to fly business?

Don’t we just hate rubbing shoulders and elbows with strangers in coach?  The funny thing is that we can accept it when we fly for leisure ourselves, but somehow enduring coach travel for business is simply unimaginable.  Some argue that it’s for safety.  Some says it’s important to get on board and off the plane first.  “Since we need to catch business meetings immediately after landing, we need to arrive in our best physical and mental condition”.  What a load.  Everyone wants to get an exception because they are just too important for the company.  Yes, the company will cripple if they cannot fly business.

What routes can I fly business?

“Only flights over 8 hours are entitled for business class? Ok, Ms Secretary, please book me a trip to fly to Australia onward to Japan then to Manila over to Shanghai before heading home.  Then I can travel business the whole way through right?”  “Why is China no longer a “hardship” country?”  “Have you flown to Delhi before?  Do you know how awful the airport it is?”  Why this, not that, is the most common question we get and we normally politely direct them to talk to either HR, finance, or security.

 What are our preferred airlines?

 In fact this is now relatively less common in this part of the region.  It is easier to identify, say, United for the States, but it is a lot harder to identify one or two preferred airlines that fly to most cities of the region. Having  too many preferred airlines just simply does not make sense.  Instead, companies nowadays adopt the lowest carrier/airfare concept.

What are lowest airfares?

Corporate travel desks are required by management to quote lowest fare options to business travelers with the idea to make sure all staff takes these options automatically.  Yet I still see a lot of cases where travelers still insist to fly their own preferred airlines because of either better timing, better alternation flexibilities, or simply, a much more attractive mileage program that benefits the travelers personally.  I am seeing some global companies requesting travelers to fork over their mileage, or ask airlines to enroll ONE corporate mileage account for all business travels, so that all awards can be used for business, instead of some executives’  lavish first class vacation to Hawaii with their wife and kids.

What are our preferred hotels?

This always strikes up quite a controversy.  You can get consensus easier with the best airline for each country (which usually is the flag carrier because of the best timing and most frequent schedules), but it is almost impossible for everyone to agree with what hotels are the best for each city.  Some insists on 5-star ratings.  Some focuses on their proximity to offices.  Some  wants to stay away from American properties due to recent terrorist attacks.  Some require lavish conferencing and banquet facilities.   Of course, with corporate’s continuous strive to cut costs, maximum city overnight rates have been decreasing year after year, and it just requires procurement’s super powers to conduct regional RFPs for preferred hotels hopefully to please everyone.  At the end of the day, you always end up with a few travelers who make it an effort to scream at you every time they see you.  Very rewarding job it is.

I myself, am just another ordinary traveler.  I want the best for myself and I always dream to stay in the best places, fly business with the best airlines, be picked up by stretched limos, and have unlimited per diem.  However I am also realistic, and I know what the real priorities are.  Those reckless spending days are over.  Instead, I’d rather focus on negotiating a higher paycheck for myself.  Business trip is a business trip.  Admit it, no matter how pampered you are being treated, you will still whine and bitch about it no matter what!

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