SMEs Find New Reasons to Globalize

Globalization. It's a buzzword that's gotten traction in recent years in the travel industry as suppliers and corporates reach more countries and markets around the world than ever before. But globalizing a travel program up to now has been a strategy mostly reserved for larger companies, leaving small and midsize enterprises out of the conversation.

While large programs may have the time, money and resources to globalize, SMEs have a more difficult time justifying the cost of consolidating travel services worldwide. Now, however, SMEs are finding a new value proposition thanks to the improved data and risk management opportunities that come with globalization.

"We have a lot of current customers that fit into that SME [category], and while they may have had, or do have, global locations and global business, not until the last year or two has globalization become a major initiative for them," said Travel and Transport vice president of account management April Wheeler. "I am seeing, probably on about a weekly basis, customers anywhere from $500,000 spend in the U.S. and maybe they have a couple million globally all the way up to a couple million in the U.S. and 4, 5, 6 million globally—they're asking now about ... how do we globalize?"

Christopherson Business Travel CEO Mike Cameron also has seen more interest in globalization from SME clients, and he attributes the shift largely to companies' desire to improve duty of care in light of recent world events. One SME client with an office in Brussels asked Christopherson to present a globalization strategy, "100 percent precipitated by the Belgium attacks," according to Cameron. "Their CEO wanted to know where all of their travelers are at any given time. When the Belgium attacks happened, the CEO felt the urgency to do all he could do to protect his employees."

Christopherson is a BCD Travel affiliate and so the two agencies work together to support programs looking to globalize. Recently, BCD Travel added resources to its affiliates program to support smaller TMCs like Christopherson, which now have a growing base of clients looking to globalize.

Another driver of globalization among SMEs, according to BCD senior vice president of global business solutions Juan Perez, is the valuable data that comes with consolidation. "SMEs sometimes think that if they consolidate, they can get better deals, but really what they have is more visibility into their program than they've ever had before," Perez said. "They can figure out, 'Are we expanding into markets, therefore we have to help our company expand into those markets?' Or, 'Are we doing product launches here and maybe we need to support that?'"

Just because more SMEs are looking to globalize, however, doesn't mean it's the best solution for every company. "More and more companies are looking for it and expecting it," Perez said, "but they still have to be grounded about why they want to do it. I always like to tie what a travel department is doing back to how it's going to help the company reach its goals."

Some companies, Wheeler said, might find they can still serve their objectives in other ways. For example, if the company wants duty of care and risk management, some SMEs might be better served to work with providers like iJet and International SOS to track travelers and feed the data back into their program and TMCs.

Travel and Transport COO Tim Fleming said companies should be mindful of the difference between globalization and Americanization. "In some scenarios, some customers want to dictate everything from the U.S. headquarters because those are really Americanized programs where they're trying to replicate what happens in the U.S. around the world," he said. "You don't want to Americanize a program and force something that actually provides less service to travelers than they might get locally, based on the customs of that country."

Formulate a Globalization Plan

When FTI Consulting global travel manager Lucy Mosca took on her current role as the company's first travel manager back in March 2015, she knew she wanted to focus on duty of care and streamlining information in the midmarket travel program.

She decided to consolidate globally with BCD, which already managed travel for the company in North America, Hong Kong and Australia. FTI recently completed implementation in Brazil and is in the process in the rest of Latin America. Mosca started with Latin America because board members there approached her about it after a small presentation she'd made. She saw the interest there as an opportunity to roll out BCD in the region and use it as an example for others.

FTI also has rolled out iJet as its risk management company across the travel program. "Since we implemented iJet, we've had much more high-level discussions within the company," Mosca said. "More of the countries want to be implemented [with the travel management company] sooner rather than later."

While Mosca's experience provides one example of a small and midmarket enterprise beginning the globalization process, TMC service providers emphasize that there's no one-size-fits-all solution, regardless of the size of the program.  "Every one's a custom evaluation and a custom implementation," Cameron said. Some things he considers when evaluating a program for globalization include: travel volume; transactions; technology being used; the number of travelers in every country; the type of travel employees do within those countries, whether it's domestic, regional or international; the current TMC service configuration; and potential cultural and language barriers. "We also look at whether the client's goals are cost driven, service driven or risk management driven," Cameron said.

This early process is key to figuring out how and if a globalized program should be implemented. "It's just really important to be prepared and do the discovery and ask the questions ahead of time because there's a lot to think about and there's a lot to consider before jumping into the globalization," Wheeler said. "Sometimes I find that's when we get into it with our contacts. They haven't really thought through the whole downline process and how important it is to ask and do the downline discovery internally."

Once the big questions are answered, corporates and their partners need to figure out the implementation strategy that makes the most sense for their company. "Come up with a plan for how you want to roll out your implementation schedule," Mosca advised. "Is it going to be by region or by the country with the most travelers? I've been hitting it more regionally because I can do a couple small countries at the same time in a region as long as the languages are the same."

TMCs also may advise programs to use hubs for countries with low volumes of travelers or low spend. "We do that in Europe, where a hub country handles two, three or four other countries," Cameron said.

Other areas that globalizing programs need to consider include online booking tools, expense and payment cards. In some regions, using a single OBT, expense or card provider makes sense, but in others a single supplier for anything is unfeasible. "Online booking can be more efficient and less expensive in some cases, but that's not always the case in every single market," Wheeler said. "What the tools have as far as content or the ease of use or cultural fit doesn't always work everywhere."

Mosca said OBTs can actually add time to the early implementation process, as well, because they necessitate more training for travelers who have never used them.

Prepare for the Obstacles

One of the biggest globalization obstacles for SMEs is the lack of resources available. "In a small company, there's a lot of work involved with globalizing a program, and many of the larger customers—they have multiple people managing travel within that corporate that can help," Fleming said. "In many cases within the SME market, you have somebody that travel is just part of their responsibility and they do a lot of other things. Getting the time necessary from the company standpoint, not only just from travel management but also from IT resources to a lot of the other resources required to make that globalization happen—it's more difficult for the smaller customers."

SMEs also can encounter a lack of support from travelers or from higher-up officials in the company. "One of the biggest problems we find is this being driven somewhere where they don't have buy-in from everybody else," Perez said.

Wheeler recommends engaging with local stakeholders whenever possible to clear the hurdle. "If that resource is not in place on a local level you can run into a lot of roadblocks along the way. You need somebody within the corporation at a local level that has bought into the fact that you're going to be globalizing and they understand, they support it and they make sure that there is that buy-in."

Mosca said implementing iJet and educating travelers about duty of care has helped her garner support for globalization, but she still needs to educate travelers about areas that are more difficult to grasp. "I'm trying to explain and educate them on the transaction fee—that it's the cost of doing business and the company acknowledges that and it's fine, that's why they're backing that process going forward and that it's not just so the agency can make money."

Buyers also have to consider cultural factors and be prepared to run into barriers at first. "As we all know, travel is such a personal thing," Fleming said. "There are generally relationships that exist in local markets [and] you really have to make sure that you identify what the value of globalizing the program is because I'm not certain I see any cases where there hasn't been some resistance from global markets based on relationships that generally exist."

For SMEs that do take on globalization, Mosca also had some more clear-cut advice: Prepare for a lot of off-hour calls and some in different languages.