“From Numbers to Action”

Delft, September 23rd 2010

Jeroen Hurkmans

Advito – NATM trainings sessions

The silent rise of strategic performance management

Airline Contracting - 7 October

Hotel Contracting - 4 November

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Broader Industry Trends

The silent rise of strategic performance management

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Strategic KPI’s support the travel management team internally as well as externallyy y

Education

Decisive Intervention

CommunicationCommunication

Career ProgressionCareer Progression

First Things First: Definitions Tactical vs. Strategicg

KPIs measure operational and management performance against a stated set of objectives

TacticalStrategicMeasure how well the Tactical

Any quantifiable measurements that can be tracked and

program performs in meeting core strategic corporate goals, such as be tracked and

evaluated revenue generation, cost containment or sustainabilty

First Things First: Definitions KPI vs. SLA

SLASLAFormal negotiated agreement between a client and a service providerDefines parameters for service deliveryp y

SpecificSLA measurements ARE:

SpecificOperational

Tactical

Strategic KPIs for theSLA measurements are NOT: for the

OVERALL travel program

First Things First: Definitions Dashboard vs. Scorecard

Dashboard ScorecardDashboard Scorecard

Purpose Displays performance Displays progress

Usage Performance monitoring Performance management

Updates Real-time feeds Monthly snapshotsUpdates Real time feeds Monthly snapshots

Data Events Summaries

Context Exceptions, alerts Targets, thresholds

Source Linked to systems Linked to plans

How sophisticatedly do you manage the effectiveness of your travel program?y p g

Do they review the progress against targets?

Is their data reliable and available?

Do their metrics track the “big picture”?

Is their data reliable and available?

Do they have the right level of consolidation?y g

Are performance variances reported?

And acted upon?

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Linking Travel Management with Corporate Goals

Growth

Cost Reduction

Governance / Compliance

Corporate Social Responsibilityorpo

rate

Le

vel

Savings / Cost Avoidance Negotiation / Sourcing

Cost Reduction Corporate Social ResponsibilityCnt Savings / Cost Avoidance Negotiation / Sourcing

SustainabilityDuty of Care / Security

nage

men

Traveler Satisfaction Policy Compliance

avel

Man

Demand Management Process EfficienciesTr

Mature programs track or plan to track a variety of different KPIs

Please indicate whether your travel program currently uses, or is planning to use, any of the following Key Performance Indicators.

Yes, currently used

Not used, but would like to implement

Not used and not planning to

implementAverage fare/rate development 85.0% (17) 5.0% (1) 10.0% (2)Cost avoidance 81 8% (18) 13 6% (3) 4 5% (1)Cost avoidance 81.8% (18) 13.6% (3) 4.5% (1)Total travel spend 95.5% (21) 4.5% (1) 0.0% (0)Online adoption in relation to offline/online fees 80.0% (16) 10.0% (2) 10.0% (2)Operational efficiencies/process costs 78.9% (15) 15.8% (3) 5.3% (1)TMC fees 85 0% (17) 10 0% (2) 5 0% (1)TMC fees 85.0% (17) 10.0% (2) 5.0% (1)Travel expenses in relation to incremental business revenue/turnover 30.0% (6) 30.0% (6) 40.0% (8)Spend under travel management control in relation to total travel category spend 57.9% (11) 26.3% (5) 15.8% (3)CO2 emissions caused by business travel 66.7% (14) 28.6% (6) 4.8% (1)Miles or hours travelled per year as a proportion of corporate revenues 21 1% (4) 15 8% (3) 63 2% (12)Miles or hours travelled per year as a proportion of corporate revenues 21.1% (4) 15.8% (3) 63.2% (12)Volume on corporate travel card versus total travel spend 66.7% (14) 9.5% (2) 23.8% (5)Cost of travel deparment in relation to travel spend 26.3% (5) 15.8% (3) 57.9% (11)Travel agency performance level 86.4% (19) 9.1% (2) 4.5% (1)Policy compliance 85 7% (18) 9 5% (2) 4 8% (1)Policy compliance 85.7% (18) 9.5% (2) 4.8% (1)Usage of virtual meetings 42.1% (8) 42.1% (8) 15.8% (3)Economy class ratio 76.2% (16) 4.8% (1) 19.0% (4)Advance booking ratio 81.0% (17) 19.0% (4) 0.0% (0)Customer (traveler) satisfaction 77 3% (17) 13 6% (3) 9 1% (2)Customer (traveler) satisfaction 77.3% (17) 13.6% (3) 9.1% (2)(Source: ACTE survey on behalf of Advito, April 2010)

Mature programs track or plan to track a variety of different KPIs

Total travel spend 95 5% 4 5% 0 0%

Currently usedTotal travel spend 95.5% 4.5% 0.0%Policy compliance 85.7% 9.5% 4.8%Average fare/rate development 85.0% 5.0% 10.0%TMC fees 85.0% 10.0% 5.0%Cost avoidance 81 8% 13 6% 4 5%Cost avoidance 81.8% 13.6% 4.5%Online adoption in relation to offline/online fees 80.0% 10.0% 10.0%

Would like to implementUsage of virtual meetings 42.1% 42.1% 15.8%

Not planning to implementMiles or hours travelled per year as a proportion of corporate revenues 21.1% 15.8% 63.2%

Cost of travel department in relation to travel spend 26.3% 15.8% 57.9%

Not planning to implement

Travel expenses in relation to incremental business revenue/turnover 30.0% 30.0% 40.0%

(Source: ACTE survey on behalf of Advito, April 2010)

Sample Strategic Travel Program KPIs

KPI Relevance DefinitionKPI Relevance DefinitionVirtual meeting index What is the share of meetings using

virtual meeting technology (i.e., videoconferencing) in comparison to all internal meetings?

Value of managed travel How much have we saved by sourcing and steering effectively?

Travel expense productivity How does the change in our travel d h h ispend compare to the change in

business revenue over time?

Travel intensity How much are our employees traveling to conduct business?

Change in total travel cost How much is travel management contributing to a bottom-line impact in operating expenses?

T l f H ll d th t lTravel agency performance index

How well does the travel agency perform in terms of cost, service delivery and strategic support?

How many strategic KPI should be selected?

Today I only concentrate onspeed indication

Wouldn’t fuel indication and altimeter also be useful ??p altimeter also be useful ??

1324 September, 2010 © 2008, Advito

Savings-related KPIs can be grouped and mapped according to their hierarchy

Savings / Cost 

g y

Avoidance

Net Cost ofChange in Total Travel Cost

Net Cost of Service Ratio

Value of Managed Travel

Savings Against Market Index

Change in Average Cost per Trip

Travel Intensity

Economy Class Ratio

Advance Booking Ratio

Online Adoption Rate

C ash Discounts

Policy Compliance

Travel Management Services Coverage

Virtual Meeting Index

Change in Negotiated 

Price

SourcingDemand

ManagementBehavior ManagementProcess Efficiency

Strategic KPI as featured in this whitepaperOther /Tactical KPI

Data Sources

S li AgenciesSuppliers

Total Cost of Travel

CreditCredit CardInternal

Systems

Understand and manage your data sources

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Easy? No, but it does not have to be difficult either

1. Take it seriously

2. Map out your corporate goals

3 Map your travel goals to your corporate goals3. Map your travel goals to your corporate goals

4. Define the appropriate KPIs4. Define the appropriate KPIs

5. Identify master data sources

6. Act on the data

Q&A

Jeroen HurkmansSr. Director Western Europe

E jeroen.hurkmans@advito.com Europalaan 400T +31 (0)20 56 21 822 P.O. Box 5035M +31 (0)6 23 52 99 24 3502 JA Ut htM +31 (0)6 23 52 99 24 3502 JA UtrechtF +31 (0)20 71 88 168 The Netherlands

www.advito.com

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