The last 18 months has been a rough ride for many companies. Vast numbers have cut costs to survive. And that trend is unlikely to go away as more companies struggle not just for credit but a competitive edge. The combined effect has increased demand for controls on business travel and expense spend. But Diners Club Tom Edgerton says using the right tools for cutting costs is critical if genuine long-term corporate savings are to be realised and consolidated.
“We provide our corporate clients with very sophisticated on-line MIS tools which can highlight, for example, non-compliance in class of travel or size of car or staying with non-approved hotel chains.”
These tools of course are ideal in a downturn. But they’re equally effective (and easy to use) when an economy recovers, as inevitably it will. Edgerton says Diners Club Global Vision MIS tool now provides clients with very clear spend information and allows them to drill down rapidly into subsidiary, cost centre or actual cardmember spending at will and wherever they are. “They’re practical tools based on real-world client experience – and they’re proving hugely popular.”
Clients quick to react
Several factors have had an impact on overall business travel spend over the last 12 months. Tighter controls have restricted when and how employees travel – and a number of Diners Club clients now only allow ‘revenue producing’ travel. “Also,” says Edgerton, “when travel has taken place, reduced airfares, reduced hotel rates and stricter controls on per diem spend related to meals and other services have also lowered the cost per trip. That means more and more companies are looking at ways to control their expense spend.”
Are these changes fundamental long-term ones? Or will they become less important as the economy picks up again? “We expect,” responds Edgerton, “a number of controls put in place by clients which will continue going forward as these are sound business practices. But at some point to turn the business and the economy around, companies have to get their employees back on the road to meet with customers. The demand for increased information on spend trends to monitor expense won’t diminish.”
Meanwhile Diners Club clients have made policy and spending restrictions changes quickly – and considerable savings realised. “We have seen economically-driven changes like this in the past with 9-11 and during the SARS outbreak,” says Edgerton. “The change we observed was in the reaction time of our clients. Improved MIS tools now can direct them quickly where cuts can be made and where stricter policies can be put in place – it’s all had a very deep impact.”
Exporting the best ideas
Diners Club clients are also making intelligent, creative decisions to do more with less. And that has driven increased joint projects with customers to automate, for example, back-office information feeds of card information into Automated Expense Reporting tools and ERP systems says Edgerton. All are hugely successful.
But increasingly travel and expense management rely on fresh thinking and ideas – but ideas grounded in reality. “Many of our best ones,” says Tom Edgerton, “generate out of one of our businesses in one country that is then exported to another. These ‘best practices’ can come in the form of improved client communication, better and more automated customer service, new technology tools for the cardmember and the program administrator. Also, the feedback from our client meetings and forums keep us on track with where we should be going with our technologies and products.”
The Diners difference – choose from a variety of modules:
Corporate cards – flexibility worldwide with cardmember benefits while travelling;
Diners Club Business Account – managing SME company expenses effectively with employee corporate cards;
Diners Club Travel Account– centrally billed account for airline spend for companies whose employees travel extensively but don’t hold a corporate card;
Diners Club the trainline Statement Account – secure and quick booking of rail tickets (certain countries only);
Management Information System Global Vision – keeping an eye on business trip expenses, wherever and whenever they occur.
Changing needs ahead
But just how will needs in the travel expenses sector change most radically in the next five years – and how will Diners Club itself change during this time? The trend toward global consolidation of spend data for global companies should continue, predicts Edgerton. “But you will see a consolidation of spend data that will allow companies much greater leverage in negotiating vendor agreements with major airlines and hotel chains, for example.”
The need for a consistent card program in all those countries will narrow the field as to which Global Expense Management company a client can work with, of course. “We will continue,” says Edgerton, “to improve products and services to ensure clients have a viable choice when considering a change to their current supplier, or plan to implement a new expense management program.”
This also includes an on-going commitment to regulatory change– always a significant pressure. “It’s probably,” admits Edgerton, “the greatest challenge because keeping pace with regulatory changes that impact the services we offer has potentially a huge impact on our cardmembers. But we work directly with regulators to anticipate changes and get ahead of them – it’s simply the best way to plan and deal with such opportunities.”
Unique support
It’s useful to remember that Diners Club remains one of only a handful of card providers that offer corporate payment solutions in more than 50 countries. Diners Club was the first independent credit card company in the world and now has more than 25 years of Corporate Card experience – a huge resource to draw on. “We really do pride ourselves in servicing a Corporate Card Program from the corporate headquarters down to the individual traveller with a consistent set of services in each of our operating countries,” says Edgerton. “With over 100,000 multinational, local corporate and small business clients globally we are well positioned to service clients, wherever they operate in the world.”
For more information contact Tom Edgerton, Executive Vice President, Diners Club International
Tel: +1 224 405 3196
email Tomedgerton@discover.com