Amadeus’ CFO research finds corporate travel managers must strike better balance between service quality and cost reduction
- Majority of CFOs (Chief Financial Officers) dissatisfied with how travel costs are currently managed in their companies
- Finance executives look beyond direct travel costs to benefits of new travel technologies, employee productivity and service excellence
The study is a result of research* with CFOs in Europe, the US and Asia Pacific in a variety of industry sectors and investigates their perspectives on corporate travel management – an area which, to date, has not been widely explored. It found that while CFOs clearly view travel through a cost-control lens, travel cost management has so far made a minimal contribution to companies’ overall cost control programmes.
CFOs believe that corporate travel managers should better balance travel service quality with cost cutting, driving direct cost savings through improved supplier negotiations and a tighter view of travel spend across the company. CFOs also want their travel teams to focus on enhanced employee productivity and integrated corporate IT systems.
Key findings are particularly pertinent against the current backdrop of economic uncertainty, with companies scrambling to cut costs without compromising on standards:
- Almost two-thirds of CFOs surveyed rated online booking tools (63%) and automated expense reporting tools (66%) as having medium to high cost saving potential.
- CFOs expect travel managers to prioritise staff productivity saving employees’ time before travel (planning and booking), while travelling and on return (expense reporting and reconciliation) to minimise the indirect costs of travel.
- 71% of CFOs believe it is very important to integrate travel technology with expense management systems however just 18% say their companies’ have highly integrated these systems. Integration with other business systems such as Enterprise Resource Planning and Human Resources databases are also considered important in the overall mission of managing travel costs but again, performance is lagging.
- Three in four CFOs believe travel managers should focus on improving supplier relationships. The research shows that this is an area where CFOs believe travel teams are currently underperforming. A single view of travel information across the entire business will support leverage with such suppliers and will find additional favour with finance departments by enabling:
- More fact-based advice on improved profitability
- Tighter cost control by being able to track travel spend by project or individual
- The ability to create better budgets and forecasts
The report also found that over 50% of CFOs are still not wholly convinced of the business benefits of ‘green’ travel.
Commenting on the report Frank Palapies, Head of Global Commercial Operations, Amadeus said: “Amadeus’ objective in commissioning this report has been to discover how finance and travel management departments can work together more effectively and what role technology can play in supporting this. It seems there is still a discrepancy between maintaining corporate travel service quality while striving to keep costs down, but technology can help by providing the tools to increase the transparency, efficiency and control of travel programmes.”
Just 27% of respondents considered the relationship between corporate travel service departments and CFOs to be very effective, although CFOs make the ultimate decisions on travel budget and travel technology investments. The report however can be used as a practical guide for corporate travel managers to “speak the language” of those working in finance departments and present smart business cases for travel programme investment with the right mix of cost, standard and value arguments.
The full study can be downloaded at:
*About the research: In July 2008, CFO Europe Research Services, a unit of CFO Publishing and part of The Economist Group, began a research project with Amadeus, asking senior finance executives for their opinions about travel management. The report is based on the results of an online survey of more than 120 senior finance executives in Europe (50%), Asia (25%) and the US (25%), and on in-depth interviews conducted with executives at the following companies: • Affinity Insurance Services (Aon) • eBuilder • Logica • McCann World Group • Sightsavers International • Swiss Re
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