"Corporate travel management is the growth industry for the decade," declared Mary Kay Dauria, director, Worldwide Travel Services, American International Group (AIG), New York. 'The field is just coming into its own."
Currently, the responsibility of overseeing corporate travel is usually left to the company's purchasing or personnel department or is put under the controller's office or, sometimes, under the purview of a secretary (who often emerges as the corporate travel manager). Only a little more than half of the Fortune 500 companies have travel managers at all.
Though in the past the corporate travel manager's position in the corporation had little clout, the spiraling increase in travel expenses and the recognition that travel is the third greatest controllable expense (after personnel and data processing) have catapulted the job to a higher status.
"Corporations recognize the need for the position when they start realizing how big the travel expenditure is and that they have an ability to impact on that expenditure," said Ed Rathke, corporate travel manager for Aetna Insurance Company, Hartford, CT, and a former president of the National Business Travel Association (NBTA), the Alexandria, VA based trade association for corporate travel managers. "The larger the company, the more the emphasis, and the higher the position."
No longer just a service for the employees, corporate travel management is becoming appreciated as a means for a company to achieve its business goals, help other departments reduce their costs, and, increasingly, serve as a profit center. Moreover, following the Persian Gulf War, corporate travel managers were recognized as critical advisers on safety and security concerns.
Staffing
Members of a company's corporate travel department are generally employed by the company itself and receive comparable salaries and the same benefits as other employees. They are responsible for arranging travel for the company's employees, arranging meetings and conventions, and managing travel budgets that can amount to millions of dollars.
Companies may employ a single individual to be responsible for setting up a travel budget, establishing policies for employees to follow (such as who can travel first class), and acting as the liaison with an outside travel agency that actually handles the arrangements. Or, an entire staff may be organized to function much like a commercial travel agency. Sometimes, an outside travel agency establishes an "implant" on the company's premises, which operates like a branch office of the travel agency to handle the company's travel arrangements exclusively but is staffed by the company, the agency, or a combination of both. This arrangement enables the company to recover some of the travel expense.
Corporate agents do not have the reduced rate travel privileges of agency personnel, but their salaries and employee benefits are the higher, better ones of a big business. On the other hand, the corporate travel department (because it is typically perceived as a service and not as a profit center) is one of the first to be pruned during business downturns. Moreover, mobility can be limited (but is improving considerably): Within the department, there are generally few senior positions and only one corporate travel manager. Agents tend to move up to a higher position by transferring to the corporate travel department of another company.
Broad Responsibilities
The responsibilities of corporate travel management go well beyond booking airlines and hotels for executives. When they are part of the personnel department, the responsibilities may also include personnel relocation and coordination of training programs. They may involve meeting and convention planning. Many corporate travel departments also administrate corporate aircraft, car pools, and possibly group recreational trips or vacations for employees. The manager may also negotiate barter deals and discounts with travel suppliers.
A strong business background is desirable for a corporate travel manager (who may also be called a travel administrator or a transportation specialist). The manager has to oversee staff and forecast budgets; handle accounting and reconciliation; choose preferred vendors; negotiate contracts for lower rates on airlines, hotels, and car rentals; establish travel policy; select a travel agency through a bidding process; and help implement complex management information systems (MIS).
"You have to follow and understand travel industry jargon, read the trade press, keep up with industry trends and forecasts which change daily," advised Dauria. For example, you have to be alert to an impending airline strike or new service or a change in oil prices that could affect fares, as well as who is buying aircraft and who is paying bills on time.
You also have to be the neutral arbitrator standing between the company and the travel agency and other vendors. "Sometimes I am accused of being on the payroll of the travel agency, but you can't automatically assume that the agency is wrong," said Dauria, whose company generates $100 million in travel. AIG is one of the largest international insurance companies, with 130 offices (125 in the United States) and more than 500 locations of travel.
Dauria is working on a pilot project to globalize and consolidate travel as was done in the United States. The 125 different U.S. locations that worked with 100 different travel agencies now work with one. Dauria is working next to bring in the foreign locations.
But corporate travel management is very much a service business. "You have to be someone who gets self gratification and not live for pats on the back," observed Dauria. "You don't hear from people except when there is a mistake." You need to be a self starter, someone who is hard working but likes change. "You can work for months on something, and then something changes." You need excellent communications skills, a "calm spirit," and diplomacy.
"Corporate travel tests your business acumen. It is a fast moving, changing specialty area of business. It is fun because the people are fun," said Dauria, who started out in urban planning and moved into corporate travel management more than 12 years ago. "People in the industry have open minds; they are well traveled. They help each other, even if they don't know somebody. It is a tight network."
Advantages and Disadvantages
The disadvantage for someone in Dauria's position is that 80 per cent of the time is spent on the road. "It is not fun. It is not a vacation. When I am on the road, I am working from 8 a.m. to 8 p.m. It is a misunderstood industry and you have to be able to explain it" and continually fight the perception that you are out sightseeing when traveling.
On the positive side, there is tremendous growth opportunity ahead because so many companies have yet to designate a corporate travel manager and because other avenues for mobility are opening up. "You have access to every department and access to the highest offices. There is high visibility, great contacts," Dauria noted. Other career paths are into consulting, into large corporate travel agencies, or into vendor companies like airlines. Also, there are more and more training programs, particularly through NBTA.
Salaries
Salaries for in house reservationists range from $15,000 to $40,000; managers, directors, and vice presidents can make be tween $20,000 and $100,000. Dauria took a $10,000 cut in salary when she moved to corporate travel from an airline, but she tripled her salary in a six year period.
Corporate travel management has been an excellent field for women. According to a survey by NBTA, 56 percent of corporate travel managers are women. Also, while 57 percent have a four year college degree, 31 percent have only a high school diploma.
An Example: Aetna Insurance Company
Aetna Insurance Company separates its corporate travel function into three areas: executive travel (which handles the top 50 executives in the country, scheduling corporate aircraft and ground transportation); conference services (which handles the company's vast meeting and convention planning and special functions and administers the Aetna Institute, an apartment complex for the company's trainees in what amounts to a 300 room hotel); and corporate travel (which arranges travel for employees at headquarters as well as hundreds of field offices throughout the country).
The corporate travel department is a $40 million operation including $30 million in airline sales (booking 4,000 tickets a month). The department, which utilizes Thomas Cook as its agency, has a staff of 40 Cook employees plus 9 Aetna management people at the headquarters and a regional office in Dallas.
Aetna hires its reservationists directly from commercial travel agencies. A minimum of two years of experience is required, but seven years of experience is more typical. A starting reservationist (with Sabre experience) earns $19,000 in Hartford (more in New York City). A reservationist can make up to $27,000 in Hartford (more in New York City).
In the past, those who tended to move into corporate travel management at Aetna were agents (usually women) who had been working for ten years or so and were no longer entranced by the travel benefits but were lured by the better salaries, security, and retirement benefits afforded in a corporate environment. This distinction has blurred somewhat since the mega agencies and large, regional travel agencies that specialize in corporate travel have come much closer in salaries and benefits.
