BRADLEY SEITZTOPAZ INTERNATIONAL, LTD.

WWW.ETOPAZ.COM

CORPORATE TRAVEL 101A Business Fable

Table of ContentsThe Fable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Graduation Day . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

The First Day . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

The First Job . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Corporate Travel Manager . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Now What? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

The Call . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

The First Meeting at Starbucks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Lesson One: The Corporate Travel Policy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Lesson Two: The Travel Agency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Lesson Three: The Airplane Program … . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Lesson Four: The Hotel Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Lesson Five: The Car Rental Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Lesson Six: The Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Lesson Seven: Performance Measurement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

Lesson Eight: Benchmarking . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Lesson Nine: Car Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Lesson Ten: The Card Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Lesson Eleven: The Expense Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Lesson Twelve: Meeting Planning . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

Lesson Thirteen: The Role of Social Media in Corporate Travel Management . . . 14

Lesson Fourteen: Associations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

Lesson Fifteen: Additional Items . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

The End . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

Rachel Totti was to graduate from Babson College, just outside of Boston,Massachusetts, with a degree in business management in about three months. Shewanted a job with a large corporation because she thought that would provide herwith the best experience to advance her career. After many lengthy interviews, she was offered a position in the three year management training program at SapphireCorporation, where she would rotate through various functions within the companyto ultimately determine where she would like to work. After a couple of days thinkingabout it, she took the position. Times were too tough to play hardball or to look forsomething else; she needed experience and this was a great place to get it.

The excitement of her first real job, even before she actually graduated from school,was too much for her. She went to dinner that night with her friends and shared

a champagne toast. They had decided when they met as freshman that theywould toast every time one of them got a job when they completed school. This was their first toast, because the global economy made it very hard onnew graduates. This bottle of champagne would also be their last before graduation because not one of her friends received any job offers.

So as the school year wound down, the focus for Rachel turned to what it wouldbe like in the real world. While she worked many different jobs during her life,starting in high school, none of them seemed to be like what was ahead atSapphire. This was a real job in a real office in downtown Boston. What wouldshe wear each day? Where would she live? For the first time in her life theweight of the world was on her shoulders.

Rachel soon realized she had no idea what she was going to be doing at this new company! She knew Sapphire was a great company with offices all over the world, had revenues in excess of $25B and she was going to be part of a very lucrative training program. Those were all good things — but what would happen on that first day of work?

Anxiety began to set in.

The Fable

page 1

Graduation DayAfter four hard years of working towards this degree it was time for Rachel tobecome a college graduate. At commencement, the graduation speaker was a localentrepreneur who had started and sold multiple businesses, James O’Brien. While

Rachel was excited for this day to finally arrive, her mind continued to be onwhat the future was going to be at her new job. That is until James started

to speak.

“Nothing you learned in school will prepare you for the future” he started out, and received many cold stares from the professors sitting allaround him. He went on to state how the world is changing right before

our eyes, and the business world as we knew it is no more. “Business hasnot changed over the hundreds of years people have run their own businesses.

Whether a blacksmith or a software company, it is about providing a valuable service or product, having satisfied customers, and doing all while making a fairprofit. We must all adhere to those basic principles and build successful businesseson that foundation.”

While he went on to share some of his predictions, Rachel got really nervousabout her new job and her new company. But it was these thoughts of businesssimplicity that remained with her during the few days following graduation.

The First DayIt was a sleepless night. Yes, there continued to be anxiety, but there seemed to be more excitement about the future and what was about to happen. She woke up early and put on one of her new business suits. She was told to arrive at head-quarters at 8:00a so that she would have enough time to obtain her new securitybadge and be ready for day one of orientation at 8:30a. Piece of cake, she thoughtto herself.

page 2

page 3

And it was a piece of cake. Everything went great. Benefits explained, companydescribed, employee handbook reviewed. And before she knew it, it was the end ofday one, and she still had no idea what she was doing. But she would soon find out.

The First JobUpon arrival on day two, the group of new management trainees was greeted by ahost of Sapphire employees, none of who were familiar to Rachel. But the traineeswere familiar to every one of these Sapphire leaders as they sought out their newhires and introduced themselves. “Hello Rachel” said Oscar Beasley “let me be thefirst to welcome you to our little part of Sapphire, purchasing. We are looking forward to having you on the team as you tackle corporate travel and become theleader of that department.”

All at once, a wave of doubt came over Rachel as she pondered what was just told to her. What the heck is corporate travel?

Corporate Travel ManagerOscar walked with Rachel to a building about five blocks away from corporate headquarters and into an old warehouse, renovated with rows and rows of cubicles.The excitement of the new job in a big new company was becoming a reality now —it was not all beauty. As they walked Oscar shared with Rachel what the responsibilitywas for purchasing. “The idea behind it is simple — Sapphire Corporation buys a lot of things — from pens and pencils to large office buildings all over the world.And to ensure we get the best prices for everything we buy, our purchasing depart-ment consolidates and purchases for the entire company. We want to make surethat for everything we buy we are getting the best rates, and therefore maximizingprofitability for the company. We want to make sure we are utilizing our assets tothe maximum each and every day.”

page 4

Oscar then went on to describe what the corporate travel manager did. “The corporate travel manager is providing the infrastructure to allow the travelers atSapphire to conduct their business in the most cost effective and the most costproductive manner. Unfortunately you are taking over an area that has received little focus during the past couple of years. We lost our former travel manager two years ago, so it is your responsibility to take over. I have no idea what travelmanagement is, so I am relying on you to learn the business and educate me aswell. You have my full support. Good luck.”

And with that, Oscar left Rachel at her new cubicle. What a nice boss.

Now What?It was obvious to Rachel as she sat around her office that she was the first personto sit down at this desk for a long time. There were piles and piles of documentsthat had accumulated over the past couple of years. Reports that looked like foreign language to Rachel — city pair reports, exception reports, market sharereports. “What was all this stuff?” she wondered. Then she started looking aroundher desk and found plastic airplanes, and model cars, and a lot of hotel businesscards. All kinds of stuff related to travel. While it was daunting considering whatwas ahead of her, there was something about getting involved in travel that wasputting a smile on her face. Then she noticed one business card taped to thephone — with scribbles all over it like “best”, “favorite” and “☺

”. It was simply acompany name that had no descriptive explanation and some phone numbers. It would soon prove to be her corporate travel savior.

page 5

The CallRachel got up the nerve to dial the number. “Doug Finch, can I help you?” was the response. Rachel then told Doug the story of how she found his name andnumber and reached out to find out what he could tell her about travel management,Sapphire Corporation and the current state of her first professional position. “Do not worry,” assured Doug in a very calming voice, “let’s meet at the Starbucksacross from your offices tomorrow morning at 8:30a and we can start the lessons.”Rachel agreed, knowing that nothing was creepy about this because it was a very public and busy Starbucks. However, she just finished school, and was notinterested in anymore lessons.

The First Meeting at StarbucksRachel woke up early the next morning anticipating what Doug would besharing with her. Then as she walked into the store she realized that she hadno idea what he looked like and she had not had the opportunity to describe

herself to Doug. Acting cool and collected, she ordered her skim latte, andlooked around the room at all the occupied chairs when an older gentleman

walked towards her and introduced himself as Doug Finch. “Hello Rachel, welcometo my favorite place to do business!”

Sitting down, Doug then started talking, “Let me share a little about myself. I amsure you are wondering who I am and what I am all about. About thirty years ago I graduated from Babson College and started working in various companies and a host of different professions. Then I landed in corporate travel and started a project to consolidate data for a large multi-national corporation. It was the begin-ning of the end. I completed that little project and then took over the position of leading the department as the travel manager, before leaving that company towork for a couple of travel agencies, and finally starting my own business.”

page 6

Rachel now thought this was going to be a sales pitch to use his services.“But Iwant you to know I am not looking to charge you for anything,” Doug stated.(Wow, how the heck does he know what I am thinking?) “But I will give you somedirection and guidance that might just help you along as you navigate these waters.I hope that in the long run you value this enough to share with your colleagueswhat I might do for them. And that is how some of us do business in the corporatetravel world.”

Rachel went back to her office and thought about Doug and what he had said. It was very interesting, and he always said that Rachel could stop the meetings atanytime and that would be the end of it. What Doug proposed was one meeting aweek to talk about some of the subject matters that corporate travel touched. Itwould last many weeks, but in the end, Rachel hoped some understanding of thejob would be gained. Rachel felt a need to speak to her new boss about this, andhe wholeheartedly approved. He told her that corporate travel industry was veryclose, and they seem to look out for one another. And they never forget. Then theystarted their lessons.

Lesson One: The Corporate Travel PolicyThe corporate travel policy is the document that outlines what can and cannot bedone while planning, booking and traveling within your company. It tells howflights should be booked, what expenses are reimbursed, who to call and what canget you in trouble. It is a guide to traveling. It is the foundation for any good travelprogram because it is the tool that communicates with all the travelers on how thecompany would like them to act when spending the shareholders money. Some ofthe items to be considered when writing a good travel policy include the following:

page 7

a) Airline: Do employees fly on the lowest airfares or preferred airlines? If there isa requested departure time or arrival time, how many hours around that time cana cheaper alternative be suggested or required? What is the minimum savings fortaking a cheaper flight? Is it required if it is only $1 cheaper or $100 cheaper?What class of service is allowed? Does a longer flight entitle business or first classtravel? Should you be booking your airline tickets in advance of the departure date?

b) Hotel: You want people to stay in preferred hotels because you can obtain thelowest rates when you deliver on a set number of room nights — but you do notwant people staying in a Marriott at a great rate when someone might be willing tostay in a Red Roof Inn for $75 less per night — so it is a fine line.

c) Car Rental: This one should be easy because you pick a company based on thelevel of service you think your culture demands and then you go for it. Usually youcan dedicate and drive 100% of your demand to one company — unless you choosea really bad car rental company.

d) Additional: There are a lot of additional items that go into a travel policyincluding descriptions of insurance, who top executives can fly with and who theycannot fly with, what travel management company you should be using, allowableexpenses like dry cleaning, laundry, parking, movies in hotel rooms, airline clubmemberships and anything else that might occur when employees are traveling forbusiness. There is too much to list here. But we will talk about getting out to meetpeople and share ideas (and policies) so you can see how others do it!

page 8

Lesson Two: The Travel Agency (Sometimes referred to as Travel Management Company or TMC)

If the travel policy is the foundation of your travel program, then the TMC can be considered the engine. They are the front line with your travelers so they mustdeliver on the promise of good service, but they also control the efforts to lowercosts through your preferred programs. Whether you use an automated onlinebooking system or the traditional travel agents, understanding your program andthe objectives of your program will go a long way to delivering results using thelowest cost alternatives for business travel.

When choosing a TMC for your program you will be balancing out many alternatives that you must evaluate to determine what will work for you and yourcompany. To simply evaluate a TMC based on price would be doing your travelprogram a disservice. You must look at the combination of intangible things likecommitment, service delivery expectations, and extra services (24-hour emergencyservice, unused ticket tracking, etc). Add up all the variables to determine who is best to partner with. And then, to ensure they live up to the levels of service that you expect, constant vigilance and measurements are necessary to ensureongoing excellence.

Lesson Three: The Airline ProgramAnswering the question about where do your travelers go and what are the best airlines to get them there is the first and most important question to answer beforeyou can determine how to construct an airline program. As you can see, this is why an airline program is not the first step in a travel program. You must know thepolicy that needs to be followed and then the TMC to manage and collect some data.

page 9

In a perfect situation, you would hope that you have travel patterns where multipleairlines would compete for your business. Then, if you have a combination of markets and classes of services that airlines would covet (like international businessclass or even first class for some executives), it will allow you to obtain some substantial discounts over smaller companies in the marketplace.

Due to the airline expense being such a large expense item for travel, this can be a good place to find savings by obtaining discounts. Depending on where youremployees are traveling and how, you may be able to save some big bucks!

Lesson Four: The Hotel ProgramThe fourth step — and usually the second biggest spend in travel — is the hotel program. Here you must attempt to focus your spending with the most popularhotels in the most-traveled-to cities, to obtain the necessary leverage to negotiatepreferred rates and amenities. Pretty simple.

But, you have to start by making sure you have good data to support the move-ment of hotel room nights to preferred properties, and you must have the cloutand company support to drive traveler behavior to the preferred properties.

Saving money is not the only criteria when choosing a hotel to participate in your hotel program. You must decide on the class of hotel that best fits the needsof your corporate culture and traveler behaviors. Are you more of a Four Seasonstype of business or Fairmont or Marriott or Motel 8? Each one offers a differencein service and price that can be dramatic.

page 10

Lesson Five: The Car Rental ProgramThis one should not be too difficult. You are looking for a car rental company thatwill provide:

a) Safe and high-quality cars

b) Appropriate airport transportation to your vehicles

c) Insurance coverage (unless provided by your card program)

d) All at a price that is acceptable

Effective analysis of your bids should provide most of this — and a little field testingwill tell you how the companies perform in the field for your travelers. You mightaccept a lower price at the expense of having airport shuttles coming less often.Alternatively, that may be something you are willing to pay for!

Lesson Six: The DataCollection of the data is imperative to negotiating with any supplier that you wantto do business with. You collect data from the following sources:

a) Travel Management Company — This provides booked data from all travelers using your TMC.

b) Corporate Card Program — When you have a widely issued card, you can use this for charged data.

c) Expense Report Processing — This final step results in data that actually is reimbursed.

d) Vendors — Some vendors have coding that keeps track of what your company spends with them.

page 11

As you can see, there is no one good source of travel data — you have to alwayskeep an eye on all these sources to ensure continued focus on not just what isbeing spent, but the all important leakage to your program. Knowing where moneyis leaking will allow focus on groups, divisions or individuals to improve the program!

Lesson Seven: Performance MeasurementMeasuring the performance of each of your vendors will be a key factor in the success of your program. You will not survive the scrutiny of the leadership in

your company unless you can prove that the vendors working with you have provided a value-added service, and that you have measured their performance.Some ideas for measurement:

Overall: Savings from negotiated deals, customer satisfaction, performance vs. the internet

Agency: Call answer speed, obtaining lowest airfares within policy, GDS comparisons

Air: On time performance, lowest airfare performance, rates loaded correctly and visible

Hotel: Rates loaded correctly and visible, adherence to safety standards, ability to book preferred rates

Car Rental: Rates loaded correctly and visible, adherence to safety standards, ability to book preferred rates

page 12

Lesson Eight: BenchmarkingComparing yourself and the performance of your program to world-class bench-marks gives you ideas and directions on how to improve your program. How doyou measure up with what you provide to your travelers? How do your discountsmeasure up to those similar sized companies in the market? How is the perform-ance of your travel program when compared to other travel programs? All of theseitems should be answered and compared to ensure you are always at the top ofyour game (or if not, what you need to do to get there!)

A great way to benchmark is to create a local group of like-minded companies andtravel managers and to have quarterly meetings to discuss various topics. As agroup, decide on the schedule of topics and then assign each quarter to a differentteam member to spread the work and leverage the benefits that each has to offer.

Lesson Nine: Car ServiceCar service, limousines, black cars or sedans are all chauffeured services offered bya host of suppliers. They all pride themselves on high service, usually at a cost, butsometimes a necessity within larger companies for their senior level managementteams. The most important attributes to consider are quality of cars, quality ofservice and adequate insurance coverage.

However, many times businesses have a tough time with consolidating this spendingbecause there could be senior level employees that already have relationships withspecific companies and drivers that meet their needs, and they would be unwillingto switch. And most times, cost is not the primary driver of this business decision!

page 13

Lesson Ten: The Card ProgramHow do your travelers pay for all their travel expenses? Is there some way to makeall this expenditure a benefit to the company? Absolutely! Consolidate your company’stravel expenses with a card program that offers you rebates and you will get somecash back for all those dollars you spend on travel.

Once again, choosing which is best can be accomplished via a bid process whereyou invite any card company to bid on your business. Developing a commonapproach to the evaluation process will allow you to determine which of the offerswould be the best for your company. Is it a national card provider or a local bankprovider? Each alternative can have both positives and negatives for you and thecorporation and therefore needs to be evaluated carefully.

Lesson Eleven: The Expense ReportThe expense report becomes the final frontier of business travel. This is where theactual money starts to flow outward from the company to paying legitimate businesstravel expenses. So if there are points of leakage with your travel program, this iswhere you can catch it. You might find employees not using your preferred travelmanagement company, thus putting in jeopardy your airline discounts. Or maybethey are using a personal card to obtain personal benefits but costing your companyimportant rebates. They could also be using a black car service that does not havesufficient liability insurance, putting at risk large sums of money for the corporation.

Whatever the situation, the final chance to make it right is by looking at yourexpense reports. Whether you have an automated expense report process or arejust using a spreadsheet, double checking at this stage will ensure your travel program is strong and is not suffering from any leakage.

page 14

Lesson Twelve: Meeting Planning This one could go on and on — many say meeting planning is different from business travel — but it really isn’t. You should be aware that meetings could beplanned in your company and it should be on your radar. Maybe after you get ahandle on everything else!

For now, know that meetings provide a different set of circumstances and a differ-ent set of management processes. Even the payment is different — usually it is donevia a direct bill and payment process that circumvents the expense report process!But the money spent on meetings can be substantial, and therefore the savings tocombine the meeting spent with your transient business travel can be some worth-while coin. So in the end, pay attention and learn about it! It will be to your benefitin the long run!

Lesson Thirteen: The Role of Social Media in Corporate Travel Management

Yes, it is true, social media does play a role in corporate travel. However, it currentlyis more of an information inflow than participation.

LinkedIn: The major business-to-business social media platform. This would be onesite to set up an account and watch the conversation. Then join groups like ACTEGlobal, Topaz International, GBTA, Institute of Travel and Meetings, The BeatTravel, and Online Travel Technology. Connect with as many people as you can inthe business of corporate travel and start to create an online professional network!

Blogs: The blogs in the world of corporate travel are both educational and enter-taining. Blogs by Brad Seitz, Jillian Walsh, Tony D’Astolfo, Jay Campbell, and Scott Gillespie are all great resources for the industry.

Others: Facebook, Twitter, and others also have resources that can help youbecome the best travel manager you can by being connected!

page 15

Lesson Fourteen: AssociationsThere are two major associations in our little industry. The Global Business TravelAssociation (GBTA) and the Association of Corporate Travel Executives (ACTE)are the two global players. Local chapters of the GBTA allow for a more local feelof membership and events, while the others offer conferences all over the world,throughout the year. Being a part of these groups allows you to meet suppliers, testproducts and services that may help you be better, and will give you the ability tomeet with peers and compare ideas. This may be the greatest benefit of associa-tions to the travel manager!

Lesson Fifteen: Additional ItemsThere are a host of additional items that you may be asked to look at. They all pertain to travel and how your travelers spend their money. They include, but arenot limited to:

Other ground transportation

Meals

Parking

Portals and other web-based tools

Distribution tools (GDS’s, Direct Connects, etc.)

page 16

The End:Fifteen weeks later, Doug asked Rachel the question “So what do you think?” Rachelpondered, “Interesting for sure.” Since we started our conversation four months ago, I have already started to look at other travel agencies, and decided to put my airline program out to bid. There is a lot of work to do for sure, but as I meet newpeople, with your help, and by educating myself, I am looking forward to the future.However, I have one question for you, “Why did you spend so much time with me?”

Doug replied “Because I think you will remember me and my company as youmove forward in your career. Since 1978 Topaz International has been providingindependent service to the industry based on one very important quality; trust.Over the years, starting with our founder Jeannie Thompson-Smith, we have beenhonest and trustworthy, and the hope is that you know who Topaz International is and you will consider using us in the future.

Rachel stopped for a minute and thought to herself, “That I will.”

FOR ADDITIONAL INFORMATION:

Brad Seitz, President & CEObrad.seitz@etopaz.com

www.etopaz.com503.651.4300