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Overview

Travel Management

More flight routes, hotels and connective technology are making the world that much smaller. But the importance of fast-emerging markets means more trips to more destinations, and this adds new complexities for travel managers. Might there be a sweet-spot solution? TEXT: Gary Bowerman

Here is a conundrum: A traveler is delayed on the tarmac in Hangzhou, so will miss their connection in Hong Kong to Jakarta, and then on to Surabaya. The knock-on effect is missing a crucial meeting, not having time to check into the hotel and needing to reschedule a flight to, and hotel in, Bangkok the next day. What do you do?

It is the type of headache which regional travel managers are accustomed to, but also underscores a new normal in business travel. Frequent flying now combines capital cities, primary cities and emerging business hubs. Finding new flights, sourcing well-located hotels and reconfiguring ground transport at short notice are not easy tasks, particularly if the global or regional office is several time-zones away.

How to Manage the New Normal?

Do the intricacies of modern business travel mean transitioning away from regional HQ roles? Does tailoring global strategies to regional needs require networks of on-the-spot local managers paired with 24/7 premium support to anticipate and respond to changes in real time?

In Asia, for example, regional HQs tend to be in Singapore or Hong Kong, where operations have traditionally been managed for travelers across the continent. But, as Asian economies diversify and grow more complex, these cities can seem remote from daily realities in locations up to a five-hour flight away. The same applies to regions such as Latin America and Africa.

HRS regional managers in Brazil and India share how clients deploy local managers, supported by a global hotel services provider, to operate efficiently toward global business objectives.

“The feedback and issues coming from local stakeholders are channeled through our global network of consultants and market specialists so that both local and global needs are planned and taken into account at the right time and with the right scope.”

Connecting the Dots in Brazil

Identifying how global trends and local market conditions intersect is crucial in vast markets. Brazil is a good example: the world’s fifth-largest nation is a powerhouse economy of Latin America, but macroeconomic expansion brings micro-challenges to navigate.

“Managing travel to cities in Brazil and across Latin America means challenges ranging from infrastructure issues, urban mobility and safety to a high fragmentation in the accommodation industry and a multitude of channels,” says Alexandre Oliveira, Managing Director of HRS Latin America. “The consequences of these factors interacting with each other can add huge complexities.”

Decisions Should Be Based on Data

Optimizing a hotel program necessitates automation.

“Data-based decisions should be combined with the ability to engage guests to make cost cutting possible and ensure compliance,” says Oliveira. “Optimizing data is essential because you will find important variations between and within the major centers and less mainstream locations.”

Fragmented channel options add complexity.

“Many of these channels are not really online, but ‘online-touched’, and that makes comparison of terms and prices tricky,” says Oliveira. “Offline sales end up getting a higher than normal share of transactions, reinforcing the huge leakage levels.”

Expecting volatility is a rational approach for business travelers in Brazil, but risks can be mitigated by analyzing local laws and infrastructure. Selecting a hotel services partner with global reach and advanced technology ensures continuous updates and coordination.

“Our teams are connected on an ongoing basis and are always exchanging critical data, and cross-coordinating actions for each project we run for our clients,” says Oliveira.

Understanding India

With projected GDP growth of 8% in the next few years, India is on track to become the world’s third-largest economy by 2030. Global brands are deepening engagement with India’s growing middle class.

“India is a huge geographical area comprising about 200 cities that are destinations for business travelers,” says Santosh Kumar, Managing Director India at HRS. “Managing that scale in a structural context is very challenging, because even in India’s primary cities, like Mumbai and Delhi, the urban infrastructure is being expanded, and traffic can be very bad. For these reasons, location is critical when choosing a hotel or a meeting venue.”

Stronger Awareness of Online Channels

“More than 90% of business travel spending in India is generated within the domestic market,” says Kumar. “This has resulted in the hotel market attracting many new players, especially in the budget and mid-tier segments. But around 70% of inventory in second and third-tier cities is made up of independent hotels, and often these are not connected to online distribution networks and prefer payment in cash.”

Such development requires detailed knowledge of hotel districts, expert support, and careful segmentation to deliver results.

“We are seeing a stronger awareness of online channels as part of the overall hotel experience. Some interesting new chains and brands are emerging that are capable of catering to different business and leisure travel segments.”

Five Universal Challenges

1. Traveler safety
2. Traffic jams and blockages — Major city roads are frequently congested, and business travelers will want to stay close to their meeting locations.
3. Traveling to and from airports
4. Hotel procurement
5. Contingency planning

Benefits of a Regional HQ

• Closer direct links with the global HQ
• Guidance for local managers across the region
• A regional “knowledge base” for training and career growth
• Better implementation of global business travel policies
• But regional HQs can seem remote from real-time local issues.

Benefits of Local Managers

• Proficiency in English and local languages
• Closer to customers and supply chains, with strong local contacts
• Understand cultural nuances, business etiquette, and negotiation styles
• Travel frequently within their markets and monitor changes in infrastructure
• Respond faster to changing circumstances
• But reporting lines to regional or global HQ can be unclear.

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