1. Cost control and beyond: The CFO’s agenda for corporate travel Presentation to ITM and Amadeus, 23 October 2008 Jason Sumner, Research Editor, CFO Europe Research Services

2. Agenda 1.Key findings 2.Demographics 3.Cost versus quality 4.One view of travel across the business 5.How to impress the CFO

3. Key findings 2.CFOs say travel managers should prioritise employee productivity 1.Travel costs can be managed better 3.On the whole, CFOs aren’t yet convinced of the benefits of green travel 4.CFOs want to see travel IT linked with ERP, HR and expense management systems 5.Travel managers should focus on improving supplier relationships

4. Demographics 127 senior finance executives 50% Europe, 25% US and 25% Asia Most major industries represented Small to large companies

5. Cost control – room for improvement 80% 80% want travel managers to focus their programmes on immediate cost savings in the next two years 62% 62% want to see long-term savings There is a large discrepancy between the numbers managing travel costs very well and the numbers that deem this to be very important 0% 10% 20% 30% 40% 50% 60% Very important Very well Managing travel costs

6. Which travel tools would help? two-thirds Almost two-thirds rate online booking tools and automated expense reporting systems to have medium-high cost-saving potential. 0%10%20%30%40%50%60% In-house travel agency Online corporate self-booking tool Call centre – live travel agent Internet travel agencies (consumer sites) Airline/hotel websites Corporate credit cards for travel Automated travel expense reporting systems High Medium Low Don’t know Cost-saving potential

7. The value add “The services we would like to see performed by the travel agency have changed dramatically. We need more value-added services – knowing what vaccinations we should have, rather than just booking standard tickets, because we can do that ourselves.”

8. Looking beyond cost When it comes to traveller care, mobile travel services and feedback tools, more CFOs see service quality and operational efficiency benefits than cost savings. 11% 20% 15% 8% 1% 2% 27% 42% 17% 49% 33% 41% 5% 4% 25% 0%10%20%30%40%50%60% Traveller care (ie security alerts, delay/incident alerts) Travel services via mobile devices Feedback tools Cost savings Service quality Operational efficiency Regulatory compliance Don't know

9. Two views of feedback tools “I think a feedback tool would allow you to respond to things and fix them a little more proactively.” “Feedback is informal. If somebody has a terrible experience, they’ll tell our travel bookers. … If somebody’s had a bad experience on a flight I’m not particularly interested.”

10. Is productivity a priority? two-thirds  Almost two-thirds of CFOs want their travel managers’ programmes to save employees time two-thirds  For another two-thirds, employee productivity should be a moderate or major goal when procuring travel  45%  45% of CFOs want travel services to focus on employee productivity in booking travel

11. Filling time “There is probably a little more tolerance towards downtime because the tools that are at your disposal allow you to still be productive.”

12. The green light – travel and the environment Over half Over half of CFOs said they did not know what the benefits of environmentally friendly travel could be Only 19% Only 19% of CFOs said they wanted travel services to focus on driving more environmentally friendly policies in the next two years One quarter One quarter of CFOs said environmentally friendly travel would benefit regulatory compliance 4% 14% 7% 24% 51% Cost savings Service quality Operational efficiency Regulatory compliance Don't know How might environmentally friendly travel benefit your company?

13. Green drivers “More and more of our customers, who are partly in the public sector, will need to do business with environmentally friendly companies.”

14. One view of travel expenses What are the three most important benefits of having one accurate view of travel across the whole business? 9% 7% 12% 10% 32% 23% 12% 11% 15% 22% 13% 16% 30% 19% 25% 19% 3 2 1 To create better budgets and forecasts To track spending by project or employee To negotiate supplier discounts To identify unauthorised spending As the basis for advising businesses on improving profitability To identify/select suppliers

15. Integration – importance versus performance three-quarters 18% Almost three-quarters of CFOs recognise that integrating travel management systems with the expense management system is very important, but only 18% say that this has been achieved at the highest level. Nearly half48% Nearly half ( 48% ) of CFOs said they would like to see travel services improve the accuracy of travel data. 0% 10% 20% 30% 40% 50% 60% 70% 80% Highly integrated Very important ERP HR database Expense management system

16. The benefits of the single view “[One view of travel] gives you the ability to drill down further and get a sense for where the spend is highest, and then utilise preferred vendors.”

17. The finance-travel services relationship There is a disparity between the importance and effectiveness of finance’s relationships with other departments Half 27% Half of respondents think that finance’s relationship with travel services is very important, but only 27% deem it to be very effective 0%10%20%30%40%50%60% IT Procurement Travel services HR Security Very important Very effective

18. What should the travel department focus on? 4% 54% 48% 45% 58% 43% 19% 24% Other Creating benchmarks for negotiating deals with suppliers Better accuracy of travel data Employee productivity in booking travel Improving T&E expense reporting and reimbursement Better forecasting of travel costs Driving more environmentally friendly travel policies Improving traveller security and safety

19. Increasing leverage with suppliers three in four Nearly three in four CFOs said that increasing leverage with travel suppliers was important or very important, but only 36% said that their companies were doing well or very well at this. Almost half Almost half of CFOs want to see travel managers show that their system/programmes will increase negotiating power with suppliers. 6% 36% Very effective Very important Effectiveness v importance of increasing leverage with travel suppliers

20. Conclusion – speaking the language of finance 2.Emphasise integration when proposing new IT 1.Demonstrate immediate and long-term cost savings 3.A single set of travel data helps justify the expenditure 4.Frame quality proposals with customers in mind

21. Conclusion – speaking the language of finance 5.Focus on improving supplier relationships 6.Find a way to measure productivity 7.Choose carefully when making green arguments

22. © 2007 Amadeus IT Group SA Corporate & Distribution Channels ‘Cost control and beyond’ The CFO’s Agenda for Corporate Travel: Amadeus’ Perspectives Jason Long Head of Global Partners Multinational Customer Group Amadeus, Madrid

23. © 2007 Amadeus IT Group SA Highlights  Integration: SBTs and expense management  The green issue & feedback  Addressing productivity  Data and usage  Summary

24. On the bright side: The tools CFOs feel good about

25. © 2007 Amadeus IT Group SA Integration: Increasingly demanded How many of you have implemented SBTs and/or automated expense management? How can technology vendors help?

26. © 2007 Amadeus IT Group SA Highlights  Integration: SBTs and expense management  The green issue & feedback  Addressing productivity  Data and usage  Summary

27. © 2007 Amadeus IT Group SA CFOs ambivalent about green travel Cost vs conscience: When will the balance shift for CFOs? Tax implications driven by regulation? Who is your trusted emisions source?

28. © 2007 Amadeus IT Group SA CFOs see cost-savings impact of social networking/feedback tools Social Networking: a danger to programme compliance and control or an opportunity to drive cost savings?

29. © 2007 Amadeus IT Group SA Highlights  Integration: SBTs and expense management  The green issue & feedback  Addressing productivity  Data and usage  Summary

30. Ongoing Focus of corporate tools Are you focusing on this? How are you measuring? How could it be measured? Traveller Productivity

31. © 2007 Amadeus IT Group SA Traveller Productivity  Downtime is not black and white  Blackberries, wifi etc are increasing productivity during the trip  Mobile devices and mobility services are becoming more prevalent  Will corporates expect seats with power connectors, internet connectivity, GSM cells in flight? What does that mean at the booking stage?  A wider question is the debundling of services: one-way fares, meals, aisle seat, lounge access etc.

32. © 2007 Amadeus IT Group SA When is it productive to travel? How would you determine the ‘return on travel’?

33. © 2007 Amadeus IT Group SA Highlights  Integration: SBTs and expense management  The green issue & feedback  Addressing productivity  Data and usage  Summary

34. © 2007 Amadeus IT Group SA One accurate view of travel across the company  Improving profitability  Track employees/ projects  Budgets / forecasts

35. © 2007 Amadeus IT Group SA So where does the data come from for the “one accurate view” Providers GDS Inventory Systems TMCsBooking Devices Expense Mgmt. Systems Visibility of the value chain: How can this benefit the traveller, TMC & the CFO?

36. © 2007 Amadeus IT Group SA Highlights  Integration: SBTs and expense management  The green issue & feedback  Addressing productivity  Data and usage  Summary

37. © 2007 Amadeus IT Group SA Relationship with Finance: how big is the gap? And how can it be closed?

38. © 2007 Amadeus IT Group SA Summary  We need to prove our worth. Take booking tools:  Understood to be a cost cutter  Maybe as upfront investment is not high it is not valued by management  Mandating usage is not defacto  Focus on reporting and data analysis ‘savings from travel had been a minimal contributor to cost control programmes’

39. © 2007 Amadeus IT Group SA