Engineering MNC AECOM has more than 87,000 employees in more than 150 countries and many active travellers in the region. Its regional procurement and travel lead, Asia-Pacific, Kelvin Li, predicts the number of business trips will fall in five years’ time.
You made a bold forecast at a recent corporate travel forum that business trips will fall in five years’ time due to technology innovations. Are you talking about Asia-Pacific or globally?
It is a global trend as the key driver for this is technology advancement, changing how people perform their work.
From what I have seen in the past few years, the following are some factors resulting in business trip cuts.
The consolidation of operations – especially for back-office functions like finance, HR and IT – where more and more companies are setting up a shared services centre or are outsourcing, and this reduces the number of locations to have to travel to.
The advancement in telecommunication, where cost and quality have improved tremendously. In the past, the IDD charges may justify a trip. For quality, even a notebook computer has a built-in camera that is good for making video calls.
Then there is the increasing awareness of corporate social responsibility, where companies are more concerned about their carbon footprint because of travel, and are encouraging less consumption.
How will the role of corporate travel managers change and will they be out of a job?
Given the reduction in business travel, corporate travel managers will need to be more strategic.
Say from a cost perspective, travel managers will need to actively consolidate the number of corporate hotels to avoid room nights from thinning out, for example. From the travellers’ perspective, there will be higher expectations and they will only travel for very important reasons and they would need to be well taken care of when they go on these “high-quality” business trips.
Of course this all depends on how the travel industry evolves.
You are now regional procurement and travel lead for Asia-Pacific. Will this role continue to exist in five years’ time in Asia-Pacific and how do you foresee MNCs managing corporate travel?
I hope so!
Even with technology advances, there will still be a need for travel managers. Technology can support online booking tools (OBT) to link directly with a company for approval or the HR system. But travel managers are needed to understand the needs and objectives of management, and to communicate them to the TMC to configure the OBT. Travel managers also have to translate corporate direction and policies into practical procedures and communicate them to the TMC and travellers.
Personally, I see MNCs continuing to try to achieve cost efficiency and effectiveness by providing the most suitable solutions to the varied travel needs of travellers that align with company’s direction at the best available costs.
What keeps you up at night as a corporate travel manager and what new challenges do you foresee in the next five years?
How to educate the traveller on the difference between leisure and corporate travel. That is always a headache.
From time to time I receive feedback from travellers saying “I see better hotel rates at another website” or “I used Skyscanner and the price is cheaper than the one quoted by our TMC”.
I have reviewed a number of cases and have taken into consideration the fee charged by TMC, or certain members-only discount or benefits provided by the vendor, or some vendors offering their lowest cost products on their own website, or travellers only looking at the price without understanding the restrictions, particularly for flights.
Travellers only see their own one-off itinerary and costs, but the travel manager has to consistently deliver the best cost. And the travel manager will not be able to consolidate the spend and negotiate a better corporate deal If every traveller books the same hotel using a random booking site, for example.
This is not a new challenge but one that will continue to exist, given how the travel industry is more transparent today because of various new tools and websites. Travellers will have access to low prices but travel managers need to educate them of the difference, and this ties in with my belief that the role of the travel manager will not become extinct.
And if you can predict one thing in corporate travel that will not change over the next five years, what is it?
There is “no one size fits all” – the size of rooms, the need for a gym, the availability of F&B selections and the distance to the work location.
