<B>Woodside Becomes Radius</B>
By Megan Hjermstad
<I>Vancouver -</I> Woodside Travel Trust tomorrow at its annual shareholders meeting will announce its new corporate identity as Radius, emphasizing its vision of becoming a more cohesive global company. In addition to the new name, the 30-year-old travel agency consortium will introduce more stringent shareholder requirements, including higher service standards, operational standards, data consolidation ability and joint branding. Radius also will implement a stronger enforcement mechanism to police branding and operational initiatives among its 125 shareholder agencies in 80 countries around the globe.
Corporate buyers generally view consortia as less cohesive than global travel management companies but enforcing greater consistency among shareholder agencies could make Radius a more viable option for corporations bidding on global service. "It all depends upon the degree of control and the degree of efficiency put forth to force members to comply," said Ralph Brown president of Illinois-based R.D. Brown Co. "It could work just as well as a mega agency that has an affiliate program that is weak in implementing consistency."
"By the year 2010, 80 percent to 90 percent of world business will be global. The international part of our operation is incredibly important as more and more companies are consolidating and forming regional and global companies," said president and CEO Ivan Michael Schaeffer. "We want to respond to that customer base and play on the strengths we have as a global company."
Bethesda, Md.-based Woodside already has been operating as a global company with regional offices in London, Lima, Peru and Singapore, and twice as many agency affiliates outside of the United States as inside of the United States. The new name, Radius--defined as a line segment that joins the center of a sphere with any point on its surface--is the culmination of an 18-month long effort by the board of directors to create standards for consistent service delivery on a global basis among those agencies.
The 11 board members--10 representatives from shareholder agencies in addition to Schaeffer--played an active role in creating the new company name and vision. "We were not really using them as a strategic asset before," said Schaeffer. "We determined that we would work with them and they would be involved in the actual decision making."
Thomas Nulty, president and COO of Navigant International, the largest Woodside shareholder, who has sat on the board since Navigant joined late last year, said, "We're getting serious about actually being able to offer global service. It's not a knife and fork club. Now it's an organization that really has service standards and is capable of delivering to global customers."
Under the new agreement, Radius partner agencies with dual affiliations by Dec. 31 will have to drop the other if they sign an agreement with Radius. Schaeffer said in South America, in particular, it is common for the largest agencies to have multiple affiliations because there isn't enough competition.
Partner agencies will have a full year to implement new collateral co-branded with the Radius name. Agencies will be given common presentation standards so the company presents itself as one to potential clients. "Even though some of the members will continue to compete, when they go to sell a global piece of business they will be using the Radius network," Nulty said.
Radius agencies also are implementing best of breed technology in the mid and back office. In the past, the company could take reports from 17 different agencies and consolidate them. Now, agencies must implement interfaces to a customized Hi-Mark product, so data can be rolled over to a centralized location for global reporting. "The acquisition of technology is allowing a true global reprint," Schaeffer said.
Meanwhile, the company is creating a more consolidated buying base, doing risk management with prepurchased inventory and entering into fewer supplier relationships. "In the past, we had a very large pool of preferred suppliers, but we began to feel that if everyone is preferred, then no one is preferred," said Schaeffer. "We are refining those strategic relationships and as a result we probably will have much higher compliance."
While Schaeffer anticipates more agency interest following the rebranding, he said the organization prior to the announcement of the name change received 15 applications from agencies representing very significant volume. The company recently added Dallas-based Campbell Travel, and at the shareholders meeting will select and announce three to four new agency partners. "We would like to add in certain countries where we don't have representation or it isn't as strong as we would like," said Schaeffer. "We always are looking to strengthen our position in countries where we don't have the market leader."
Although some existing agency partners may not want to--or be able to--participate under the stricter terms, Schaeffer said, "We're not worried about becoming smaller. As we become more cohesive, we have greater ability to deliver to the marketplace maximum customer value proposition.