Corporate travel management

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Corporate travel management (CTM) is the function of managing a company’s strategic approach to travel (travel policy), the negotiations with all vendors, day-to-day operation of the corporate travel program, traveler safety and security, credit-card management and travel and expenses ('T&E') data management.

CTM should not be confused with the work of a traditional Travel Agency. While agencies provide the day-to-day travel services to corporate clients, they are the implementing arm of what the corporation has negotiated and put forth in policy. In other words, CTM decides on the class of service which employees are allowed to fly, negotiates corporate fares/rates with airlines and hotels and determines how corporate credit cards are to be used. The agency on the other hand makes the actual reservation within the parameters given by the corporation.

For many companies T&E costs represent the second highest controllable annual expense, exceeded only by salary and benefits, and is commonly higher than IT or real estate costs. T&E costs are not only limited to travel (airline, rail, hotel, car rental, ferry/boat, etc.) but include all costs incurred during travel such as staff and client meals, taxi fares, gratuities, client gifts, supplies (office supplies and services), etc. Furthermore, this area often includes meeting management, traveler safety and security as well as credit card and overall travel data management.

The management of these costs are usually handled by the Corporate Travel Manager, a function which may be part of the Finance, HR, Procurement or Administrative Services Department.

Global Consolidations[edit]

Many companies, especially large multinationals (MNC), opt for global consolidation of their travel procurement. In other words, they may choose to put their entire purchasing of travel arrangements in the hands of one Travel Management Company (TMC). This is almost always done with a global Request for Proposal (RFP), through which the company will invite major TMCs to participate in the RFP. The process and the selection of the TMC could take several months. Once the company has chosen its TMC, the handling of their travel arrangements will be handled by the selected TMC through out the world. There could of course be exceptions in certain countries.

The advantages of a global consolidation lie in the game of numbers: the company will be able to bring to the table, the advantage of global numbers, when negotiating with suppliers. These negotiations could include airlines, hotel chains, individual hotels (for specific reasons), car-rental companies etc. The main goal of going the route of global consolidation is to create savings in the company's T&E budget.

Travel Management Companies[edit]

The implementation of corporate travel management is often delegated to Travel Management Companies (TMC). These companies use Global Distribution Systems (GDS) to book flights for their clients. This allows the travel consultant to compare different itineraries and costs by displaying availability in real-time, allowing users to access fares for air tickets, hotel rooms and rental cars simultaneously. Examples of these companies include ATPI.

Travel Management (Trade) Organizations[edit]


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