By Olivier Benoit, Practice Area Leader
Our blog has a recurring theme of contract values changing as variables change, and in today’s world that flux is constant. We’ve touched on harnessing the power of change to help you in your hotel negotiations, and today we are going to be looking at how this same idea of ongoing, dynamic performance management applies to your air program.
It’s no secret that the sourcing game is becoming increasingly complex across all travel categories. Managing that complexity is the key to sustaining savings and driving innovation. Careful tracking of your carrier contracts offers greater potential to impact company performance. There is opportunity to improve your program all year long. The challenge is in capturing, analyzing and then recognizing risks and opportunities early and often in order to strategize and respond proactively.
Imagine that your company has acquired a competitor. Of course, this will result in many changes throughout your organization. Some of those changes will include an increase in business travel volume and a shift in carrier mix. In the past, if this acquisition were to happen after annual carrier negotiations were complete you might have been stuck with your negotiated discounts based on volumes predicted pre-acquisition. Today, a different story is possible. With dynamic program management, and the right data, you can forecast your new aggregated volume on preferred carriers and negotiate lower fares effective day one of the acquisition.
Don’t wait until annual negotiations to review your contracts. Don’t wait until carrier review meetings to address target terms performance issues. Take back control. Monitor your program in real-time to turn uncover additional savings, capitalize on innovation and opportunities, mitigate risk and manage demand. The winners of this new form of negotiations will be the agile organizations that can tap into expertise and find value wherever it exists.