Business Travel Management Strategies

Rocholl, Annette

Business Travel Management Strategies

Ways to establish an efficient business travel management program and successfully react to future trends

von Annette Rocholl (Autor:in)

BWL - Unternehmensführung, Management, Organisation

Zusammenfassung

Inhaltsangabe:Introduction:
During a rail or airplane trip on an early midweeks morning men in suits working on their laptops or reading the latest newspaper are a common scene. This might lead to the assumption that business travellers are important customers to the tourism and travel industry and companies spend large sums on the trips of their employees.
Indeed this impression can be proven right. Such 30-40% of all travel in Germany is business driven. In average companies spent 3,9% up to 5% of their yearly indirect cost on business travel.
In a globalized market business travel is important and necessary for companies. It is an investment which influences the performance of a company positively if applied correctly. However as for every investment costs are attached which need to be validated upon their necessity and their cost-benefit ratio. Furthermore for business travel aspects like security, work time, employee wellbeing and other factors must be considered to increase the positive outcome for the company.
There is a clear requirement for business travel and its management which will be explained in more detail during this thesis. However still many companies are not aware of the cost factor of business travel. Even if certain awareness has been established often still no clear strategy is in place to improve the value for money and avoid yearly cost increases. To create such a strategy it is necessary to have a good understanding of the travel industry, their relevant players and the companies travel structure.
Motivation:
Business travel management i.e. the professional organisation of business travel has just developed during the last 50 years. Globalisation and development of transportation caused a quick increase during the last years of the business travel industry. In 2008 German companies spend 46.6 billion Euros on business travel. The strategic management of business travel requirements however is still not common in every company.
Though scientific, universal literature about business travel management is limited. Only a small number of authors give directions upon how to implement a complete travel management system in a company. In many cases the available theoretical literature has no practical tips for users. On the other hand there are many white papers, studies and articles available which are up to date, give practical tips, however only refer to one aspect of the travel process. This implies that inexperienced […]

Leseprobe

Inhaltsverzeichnis

Annette Rocholl

Business Travel Management Strategies

Ways to establish an efficient business travel management program and successfully

react to future trends

ISBN: 978-3-8428-4200-7

Herstellung: Diplomica® Verlag GmbH, Hamburg, 2012

Zugl. Rheinische Fachhochschule Köln, Köln, Deutschland, MA-Thesis / Master, 2009

Dieses Werk ist urheberrechtlich geschützt. Die dadurch begründeten Rechte,

insbesondere die der Übersetzung, des Nachdrucks, des Vortrags, der Entnahme von

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http://www.diplomica.de, Hamburg 201

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1.1 Motivation 3

1.2 Definitions 5

1.2.1 Business Travel

1.2.2 Program and strategy

1.3 Scope 6

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2.1 Business travel from the beginning till today

2.1.1 Reasons for business trips and their return on invest

2.1.2 Interpersonal aspects

2.1.2.1 Communication models ... 13

2.1.2.2 Trust and relationship in business ... 16

2.2 Alternatives to travelling

2.2.1 Internet 21

2.2.2 Email 21

2.2.3 Telefone 21

2.2.4 Virtual conferencing

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3.1 Market Players

3.1.1 Business travel customers

3.1.2 Travel Management Companies

3.1.3 Airlines 30

3.1.4 Car rental companies

3.1.5 Rail 33

3.1.6 Hotels 34

3.1.7 Global Distribution Systems

3.1.8 Credit card institutes

3.1.8.1 The business travel account card ... 39

3.1.8.2 The individual traveller expense cards ... 39

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4.1.1 History of business travel management

-IV-

4.1.2 Definition Business Travel Management

4.1.3 Tasks of the travel management

4.1.4 Cost structure of corporate travel

4.2 The Travel booking process

4.3 Increase efficiency and save cost

4.3.1 Analysing the company's current situation

4.3.2 The travel policy

4.3.2.1 Creation of a travel policy ... 50

4.3.2.2 Implementation of the policy ... 57

4.3.3 Contracts and rate agreements

4.3.3.1 Airlines... 62

4.3.3.2 Hotels ... 63

4.3.3.3 Car rental... 66

4.3.3.4 Rail ... 67

4.3.3.5 TMC... 68

4.3.4 Case study: Improvement of business travel process

4.3.4.1 Current process ... 74

4.3.4.2 Improved process without the aid of software... 75

4.3.4.3 Potentials to utilize software ... 78

4.3.5 Measures and Ratios for an efficient BTM Programs

4.3.5.1 Challenges... 84

4.3.5.2 KPI Classification... 85

4.3.5.3 Build up a KPI system ... 86

4.4 Risk Management on business travel

4.4.1 Risk identification

4.4.1.1 Potential company risks... 89

4.4.1.2 Potential risks to the traveller... 90

4.4.2 Risk evaluation

4.4.3 Risk management

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5.1 Politics and World economy

5.1.1 Global economy

-V-

5.1.2 Political activities

5.1.3 Demographic factors

5.2 Environmental factors

5.3 Business travel related technological developments

5.3.1 Technological developments of transport

5.3.2 Videoconferencing 100

5.4 Travelling and Travel management in future

100

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7.1 Contents of a travel policy

104

7.2 Hotel RFQ Template

106

7.3 TMC RFQ Template

107

7.4 Air tarriffs

108

7.5 Selection of european booking tools

109

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BTM Business

Travel

Management

GDS

Global Distribution System

OBT

Online booking tool

SBT Self

Booking

tool

T&E Travel

and

Expenses

TMC Travel

Management

Company

VDR

Verein deutsches Reisemangement

CRS

Computerized reservation system

BTA Business

Travel

Account

RFQ

Request for quotation

WTO (UNWTO)

World tourism organisation

KPI

Key performance indicator

-2-

,QWURGXFWLRQ

During a rail or airplane trip on an early midweek's morning men in suits work-

ing on their laptops or reading the latest newspaper are a common scene. This

might lead to the assumption that business travellers are important customers

to the tourism and travel industry and companies spend large sums on the trips

of their employees.

Indeed this impression can be proven right. Such 30-40% of all travel in Ger-

many is business driven. In average companies spent 3,9% up to 5% of their

yearly indirect cost on business travel.

In a globalized market business travel is important and necessary for compa-

nies. It is an investment which influences the performance of a company posi-

tively if applied correctly. However as for every investment costs are attached

which need to be validated upon their necessity and their cost-benefit ratio. Fur-

thermore for business travel aspects like security, work time, employee well-

being and other factors must be considered to increase the positive outcome for

the company.

There is a clear requirement for business travel and its management which will

be explained in more detail during this thesis. However still many companies

are not aware of the cost factor of business travel.

Even if certain awareness

has been established often still no clear strategy is in place to improve the value

for money and avoid yearly cost increases.

To create such a strategy it is nec-

essary to have a good understanding of the travel industry, their relevant play-

ers and the companies travel structure.

Vgl. DETTMER, S.19

As per a study of the university of applied sciences Bad Honnef, 41% of companies to not

have a travel policy in place, cf. SCHNEIDER, p.55 et seq.

Cf. KLESSE and VDR 2008

-3-

0RWLYDWLRQ

Business travel management i.e. the professional organisation of business

travel has just developed during the last 50 years.

Globalisation and develop-

ment of transportation caused a quick increase during the last years of the

business travel industry.

In 2008 German companies spend 46.6 billion Euros

on business travel.

The strategic management of business travel requirements

however is still not common in every company.

Though scientific, universal literature about business travel management is lim-

ited. Only a small number of authors give directions upon how to implement a

complete travel management system

in a company. In many cases the avail-

able theoretical literature has no practical tips for users. On the other hand there

are many white papers, studies and articles available which are up to date, give

practical tips, however only refer to one aspect of the travel process. This im-

plies that inexperienced persons who are responsible

for building up a travel

management system in the company face the issue to obtain comprehensive in-

formation.

The first Travel managers have been established in bigger companies approximately in 1968,

Cf. JANKINS, Managing Business Travel, p. 3. Today still only 29% of German companies

employ a travel manager, cf. VDR Geschäftsreiseanalyse 2008 p. 12

Cf. VDR 2009, p.5

Cf. VDR 2009, p.4

Cf. VDR 2008, p.12

The term "Travel management system" does not necessarily refer to software, but is the basic

strategy for handling the companies' business travel. The implementation of software can be

a helpful addition to avoid administrative costs, however will not substitute a well defined

travel management strategy.

In theory a travel management system should be build up by an in the travel industry experi-

enced person. However in practice this often will be taken care of in other departments not

being experts in business travel management, Cf. Chapter 4.1.3- Tasks of the travel man-

agement on page 43

These findings have been made while working as a strategic commodity buyer for business

travel for a global company. Being new to the topic at this time it has been much work to get

as deep in the topic as I am today. This gave me the motivation to write this theis for other

people in a similar situation as described above, as I would have been happy to have such

explanations in a comprehensive, practical way.

-4-

This master thesis intends giving a guideline to companies on the effective set

up of a travel management strategy. This will include the description of the

travel market as it is today, as well as the several ways for building up a suc-

cessful travel management strategy. Furthermore this thesis will venture a look

into the future. What will potentially influence business travel and which strate-

gic setups can help to gain the right value for money also in future?

-5-

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To ensure the right understanding of the used terms in this master thesis the

used terminology requires some explanations and clear definition.

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Business Travel contains both the term business and travel. Business is defined

as "

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. Travel is defined as ,,

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. As a synonym for business

travel the term corporate travel can be used.

Accordingly business travel can be defined as any longer journey, with the pur-

pose of an activity entered into for profit.

This means, all travel for meetings,

negotiations, exhibits and trade shows, trainings, congress, conventions and in-

centive travel are included in the term business travel.

In the Gabler's business dictionary business trips are defined as: "Business trips

are occupational changes of locations apart from the usual working location or

residence of the traveller."

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Strategy is "

D SODQ RU SROLF\ WR DFKLHYH VRPHWKLQJ´. The term program is defined

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. Therefore both terms cover the planning of

actions. Planning always means to set up actions in advance. Thus this thesis

will give advice on structured actions to efficiently set up the corporate travel in

companies. As different companies have different requirements, not all aspects

of possible programs or strategies will be covered, however best practices,

ideas and advises will be given and a business travel program can be based on.

Cf. BUSINESS

Cf.

75$9(/

Cf. DETTMER, p. 16

Cf. GESCHÄFTSREISE

Cf. PROGRAMM

-6-

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The first scope of this thesis is to prepare the reader to the environment a busi-

ness travel management strategy is set up in. This includes the condition for

business travel, the historical background of business travel and business travel

management and a presentation of those market players which are relevant in

the context of business travel management.

The main scope of this thesis is the description on the successful development

of a business travel management strategy to improve efficiency of business

travel. This includes the development of a travel policy, the setup of contracts

and rate agreements, process improvement based on a case study as well as

setting up a KPI and risk management system. A conceptual description of the

business travel process will set the frame for this purpose. The recommenda-

tions made for setting up i.e. improving a program are based on this generally

assumed process. The recommended tools and methods are based on certain

studies as well as on experiences made.

The last part of this thesis will picture potential future scenarios business travel

will be affected by in future. Based on this possible ways to react with a travel

program on these trends are shown.

The following graphic shows the structure of this thesis and gives an overview

of the above described topics and their correlation.

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-7-

Out of scope are the following topics:

x Explicit strategies regarding MICE (Meeting, Incentive, Congress, Event)

will be excluded from the recommendations for setting up a BTM strat-

egy. As MICE is an interdisciplinary topic covering more than the pure

business travel, the recommended methods and tools can positively in-

fluence spend on MICE, however a full strategy to handle MICE will blast

the scope of this thesis.

x National law on travel expense handling As this thesis is a guideline to

companies, which might operate in several different countries the investi-

gation and comparison of several international or even European laws

would extend the scope unnecessarily.

x Cultural impacts on business travel This topic is wide ranged from the

different cultures influencing the importance of a face-to-face meeting as

well as the impact different cultures have on the traveller which might

need to be prepared through a travel program to these experiences. The

proper workup would extend this thesis.

x The classical business trip of sales people serving a national region, us-

ing their own company car and do return to their home daily. Even for

these trips costs occur, however a large amount of this costs occur by the

company car, which is rather served by a fleet management strategy than

by a business travel program

x The trends and development of BTM in Asian countries. As Asian coun-

tries are relatively new to worldwide trade, the BTM is just developing

why documentation and studies are quite poor. However on the other

hand programs for Europe and the US are also likely to work in other

countries, when adapting some changes. Thus the travel to Asian coun-

tries is included and worldwide statistics in the following will include Asian

Generally it is possible to include a fleet management strategy into a business travel strategy,

often comprised under the term mobility management. However this would extend this thesis

to a unwanted extend.

-8-

countries as well. However the management of travel out of Asian coun-

tries is excluded.

To ensure the consistency of data worldwide data is used wherever possible.

Where these data is not available, European or German data and figures will be

used.

-9-

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Trade and interaction with other companies makes business travel necessary.

In the following the development of business trips is shown and the reasons for

business travel are explained. This will include the different reasons companies

send their employees on a trip as well as the general explanation for the re-

quirement for face-to-face meetings. Last alternatives to business travel are de-

scribed and for which occasions those can substitute a business trip.

Especially in a digitalized world, where technique opens possibilities to commu-

nicate beyond telephone, fax or letter one may ask the question needs to be

answered why business travel is an important investment for companies.

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Business travel has a long history however just during the last years it has be-

come as important as it is today through the economic globalization as well as

technological development.

Business travel goes back to ancient times. The term business travel, as ex-

plained in 1.2 Definitions, means travelling with the intent to do business. Al-

ready merchants were travelling for mercantile expeditions to other countries

with intending to do business.

From the Romans it has been proven, that they

had a street network of about 70.000km, which has also been used for transpor-

tation of goods. They already imported silk and spices from Asia, mainly China

and exported goods for example olive oil, which lead to a prospering econ-

omy.

Those mercantile trips have been the antecedents of business travel.

The true beginning of business travel has just been during the 1950

when

technologies like the airplane improved the movement over longer distances

Cf. BRENNING

Cf. GIEBEL, p.131

-10-

and globalization

began

. Since business tourism has experienced yearly in-

crease rates. Today there are yearly 120 Million business travellers on the

worldwide roads.

Globalization

has opened up the need for companies to react not only to na-

tional market but also to international market needs. Especially Germany is one

of the heaviest exporting nations and therefore needs to deal with customers all

over the world

The only way to have face-to-face contact with customers, suppliers and col-

leagues in other facilities is to travel to the location the business partner is lo-

cated in. Thus in 2008 nearly one third of European managers and executives

spend more then 20 percent of their working time on business trips.

However in modern times there are other ways of communication than personal

meetings. Thus the question arises when and for which reasons business travel

is necessary and when alternatives may be more appropriate to chose.

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Business travel implies an investment in the company. There are several rea-

sons for business travel as shown in Figure 2 below.

Business travel is essentially depended upon trade. Thus global trade, through further global-

isation, has supported the requirement for business trips.

The technological development in transportation has caused, that today it is economical to

move goods over long distances along the supply chain rather than performing the whole

production process locally.

Cf. FREYER, p 24 and WTO: Worldwide numbers of air passenger arrivals 1950-2005

The Organisation for Economic Co-operation and Development (OECD) describes the term

globalization as follows : "The term globalisation is generally used to describe an increasing

internationalisation of markets for goods and services, the means of production, financial sys-

tems, competition, corporations, technology and industries. "

WTO, World trade developments in 2008

EASYNET, p 13

-11-

Congress and Events

Sales meetings

Fairs and exhibition

Visits of affiliates

others

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The above sales meeting figures for the US market include 22% "work at the

client's office". This indicates that the research base seems to include a high

number of consulting companies, which regularly work at their customer's office.

The German figures do not go into this much detail and have been potentially

researched on different industries. However even the above figures differ

slightly for the two markets the tendency is clearly visible. The main reasons for

business travel are customer visits i.e. sales meetings and congresses.

The research company Oxford economics USA

has published a study about

the return on invest (ROI) of business travel. It has been established, that sales

meetings and congresses create the highest ROI compared to trips for a differ-

ent reason. These results of the study indicate the main reason for business

travel: profit maximization:

Source: Own figure following DTZ, p.5; OXFORD ECONOMICS US, p. 16

The outcomes of this study are based on a survey, which has been conducted between May

and May 08

2009 with 300 executives of companies through the platform LinkedIn.

-12-

Trip type

% of travel budget

Return on $1 of invest-

ment

Customer meetings

34%

$15-19,99

Conferences (included

in congress and events)

10% $4

5,99

Trade shows (included

in Fairs and exhibitions)

10% $4

5,99

Incentives (included in

congress and events)

5% $4+

All others

42%

N/A

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Thus through an investment of 100,000

¼ RQ EXVLQHVV WULSV WR FXVWRPHUV an in-

crease in revenue up to 1.99 million

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the US market. For the European market there are no figures available so far.

Therefore a universal statement on the exact ROI of business travel is hard to

issue. For example an employee has an idea during a conference which is im-

plemented years later. This outcome will never be connected with this special

conference. Nevertheless the previous findings indicate

WKDW business travel is

an investment and helps companies to improve their overall performance.

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In the previous chapter different occasions for business travel have been de-

scribed and the potential ROI justifies the required exchange with the customer.

Average per interviewed companies

Median of responses

Own table referring OXFORD ECONOMICS US, p. 27

-13-

In the following the requirement for personal meetings will be explained and

when a virtual meeting can substitute a face-to-face conversation.

Anyone will have experienced the gut feeling that we can better work together

with someone we know, than someone we have just spoken on the phone or

have written E-mails with. Analogical - based on a comparable level of qualifica-

tion - we rather work together with a person "talking the same language" then

with someone we don't like personally.

These rather fuzzy descriptions lead to the main reason for business travel,

which is based on how people communicate and the requirement of trust in

business relationships.

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Communication derives from the Latin word for message and encompasses the

human requirement for exchanging information. The main parts of a communi-

cation are the decoding, the sending and the encoding of a message.

A well known communication model has been designed by Friedemann Schulz

von Thun which describes the different purports of a message.

This model states that each articulated message is decoded including four mes-

sages and is then encoded as four separate messages again. Those are

Cf. KOMMUNIKATION

Cf. SCHULZ VON THUN

-14-

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The factual level gives information about the dates and facts. The appeal level

gives information about the intention of the message what do I want the re-

ceiver to do. The relationship level of a message often is given through the

phrasing of the message, gestures or mimic. It implies the relationship regard-

ing this topic towards the receiver. Finally with every message the sender re-

veals something about himself and his personality, either explicitly through an

"I- message" or implicitly.

The decoding takes place based on the same pattern however the decoding

not necessarily is correct but can differ from the intended messages.

This

means communication often is characterized by misunderstandings.

Furthermore communication is verbal and to large amount non-verbal. Non-

verbal communication means everything beside the spoken word. As per a

study by Albert Mehrabian from 1967 the non-verbal part of communication

dominates our daily conversations.

Cf. SCHULZ VON THUN

-15-

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Body language

Tone of voice

Content

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Thus, 55% of the full spectrum of communication is determined by postures,

gestures, eye contact and general body language, 38% by the tone of voice and

only 7% by the content.

This simple formula leads to the importance of business travel and its support to

the comprehension between two parties. When communicating through email

only 7% of the meaning can be transferred. Through telephone at least 45% of

the content can be transferred. With the means of video conferencing the im-

pact of transferred communication content gets close to a 100%

Mehrabian and Ferris (1967). "Inference of Attitude from Nonverbal Communication in Two

Channels". In: The Journal of Counselling Psychology Vol.31, 1967, pp.248-52

It will never meet 100% as non-verbal communication aspects like smell, feel of a hand

shake, etc. can not be transmitted by a video conference (at least currently not)

This consideration does not include any other disadvantage like time lag in virtual communi-

cation et.al. Cf. Chapter 2.2 Alternatives to travelling on page 21 et.seq.

-16-

Understanding the other party precisely is the essential base for any decision in

business. However a virtual meeting i.e. videoconferencing guarantees to get a

large percentage of the full communication aspects as described above. Thus

there must be more than just the pure understanding which makes business

travel indispensably.

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This other aspect influencing important business decisions is trust in and the re-

lationship with the other party.

A study by the Harvard business review analytical services

have found, that

the face-to-face meeting is essential for dealing with customers, especially for

negotiation of important contracts, "sealing the deal" and build long-term rela-

tionships to their customers.

One person formulated it to the point, that

³7KHUH

LV VLPSO\ QR VXEVWLWXWH IRU EUHDNLQJ EUHDG DQG JHWWLQJ WR NQRZ SHRSOH IDFHWR

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The Sociologist Niklas Luhman has given the expression that trust is a way of

GHDOLQJ ZLWK FRPSOH[LW\ LQ DQ LQFUHDVLQJO\ FRPSOH[ VRFLHW\."

This means trust

enables to deal with complexity as trust substitutes the necessity to have all in-

formation available.

A more business related definition has been given by PLÖTNER: Trust is "the

expectation of another person or group of persons, that regarding a certain

known event they have or will not behave opportunistic against the trusting per-

son."

In this definition the behaviour of a person is stressed.

This study is based on an online research of 2207 selected Harvard Business Review sub-

scribers and 15 telephone interviews.

Also compare International SCHNEIDER, p. 41

Harvard Business review analytical services, p.8

Cf. SOLOMON , p. 9

PLÖTNER, p.36

-17-

A relationship in terms of a buyer-seller relationship is defined as: "A relation-

ship is composed of the sum of exchanges and contacts between customer and

supplier over time via the regulation mechanisms in work and the parties' inten-

tions for the future based a mutual understanding."

Trust is an essential part of a relationship and vice versa trust can only grow

with a relationship

. Therefore in the following it will be investigated how trust is

build up and leads to a relationship.

First of all some premises must be stated:

x The build of trust is essentially influenced by social, personal interac-

tions.

x Trust can only be build between human beings not between corporations.

Thus it is all about the buyer-seller relationship.

x In general trust is concerned with a future event which is not in control of

the trusting person.

x Trust normally is event oriented. This means for example: If we state to

trust person X, we mean to trust this person that he will do his best that

our products are delivered in time. However also the generalized state-

ment to trust person X implies that we expect him to act also in other ca-

ses not opportune.

x Trust is characterised by the situation of the trusting person. If the trust

fails, the trusting person will suffer from a very high disadvantage, which

HOUGAARD, p.32

Cf. SOLOMON, p.14

Cf. SYDOW

Cf. PLÖTNER, p.36

Cf. PLÖTNER, p. 38

Cf. PLÖTNER, p. 39 et.seq.

-18-

often is higher than the advantage would have been in a positive out-

come.

In this framework now the possibilities of building a relationship can be

defined.

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There exist various literatures about the build of trust and a relationship.

However, to not extend this thesis on the topic of trust in the following a

model has been taken representatively.

In the below Figure 5, the model of the process of trust building is stated.

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Cf. PLÖTNER, p.36 et.seq.

Own graphic based on MAYER

-19-

This model described the process of building up a relationship. The input is the

factors ability, benevolence and integrity.

Ability or also called competence

is the skill to perform as expected and ac-

cording to standards which apply to the task or role. In a new business relation-

ship, this can be proven f.e. through a well explained product, a solution to a

problem the customer has or an award in the relevant category.

Benevolence is the perception of the positive orientation of the trustee towards

the trustor. In a new relationship the benevolence can be shown though a credit

of trust by the trustee towards the trustor.

An example of this could be to allow

the customer some insights of the processes or work style of the supplier or of-

fer a free work sample.

Integrity can f.e. be shown through referring to other projects or customers, the

trustee has already been shown to be trustworthy.

In an already established

relationship this could for example been proved by the willingness of s supplier

to support the customer on a time critical project by doing over hours, however

does not charge for this.

The more I believe that the person to be trusted fulfils those factors the more

likely trust will be developed.

Furthermore the propensity of the person giving trust is influencing the build of

trust. People who generally tend to avoid risks or have made bad experience

before will tend to be slower to trust than others.

Cf. SOLOMON, p.83 et.seq.

Cf. SOLOMON, p. 37; Cf. PLÖTNER, p.145 et.seq.

Cf. PLÖTNER, p. 139 et.seq.

-20-

To influence the trustor's propensity positively it is recommendable to create

similarities. Humans tend to trust more a person which is similar to them then

someone who is very much different.

Next the factor, the perceived risk will influence if the relationship will be

achieved. Thus decisions on investment good must be seen separate from con-

sumables. In this context investment goods are characterized by the complexity

of the good or service, the extend of the transaction as well as the complexity of

the purchasing decision.

If all factors are consistent, a relationship will be established, which will lead into

an outcome. This outcome will prove if the given trust has been proved to be

right or if adjustments in the perception need to be made.

For long-term relationships the outcome should match with the input to maintain

he trust and the relationship to stay authentic. Authencity again positively influ-

ences the trust and relationship.

Eventually the build of trust and its influence to a relationship is highly complex

and will not be fully encompassed during this master thesis. Also in this context

their no true answer is possible which situations. However exactly because of

its complexity face-to-face meetings are essential for the relationship and trust

building and therefore justify business travel. A relationship, which is built on

trust, is likely to continue the business for the next required transaction. This

however will save transactional costs for the buyer as for the seller.

,I \RX FDQ WUXVW D SHUVRQ D FRQWUDFW LV VXSHUIOXRXV ,I \RX FDQ¶W WUXVW KLP D FRQ

WUDFW LV XVHOHVV (Jean Paul Getty)

Cf. PLÖTNER, p.155 et.seq.

Cf. PLÖTNER, p. 8

Cf. SOLOMON, p.91, 93

Cf. PLÖTNER, p. 57

-21-

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The above description indicates why business trips are necessary. However the

direct alternative to business travel is not going on a business trip.

If a face-to-face meeting must be replaced by a different mean of communica-

tion the alternatives are electronic media like Internet, E-mail, Telephone and

Videoconferencing.

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As nearly every company today has its own homepage, the access to informa-

tion has become much easier. At times where information was not available

through the internet it was reasonable to invite a sales person to give some

general information about the company or physically present the product. Today

these meetings are replaced by a click to the web side of the company, where

all high-level information about the company and the products are given.

(PDLO

Email is comparable with writing a letter, beside the fact that it can be trans-

ferred more quickly to the business partner. Email is a standard instrument in

today's business communication.

It is fast, easy to use and practically. In

many cases Email has replaced letter and fax today completely or at least is

used as the quicker alternative in many cases.

However written communication only can be misleading and is not made for ne-

gotiations or longer discussions.

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Telephone gives us the chance to quickly get in contact with a business partner

for clarification of a situation or if longer discussions are required. Most people

speak quicker than they write. For larger topics or long discussions thus the

telephone should be chosen over writing an email. Furthermore a call provides

Cf. Ferries Research

-22-

the opportunity to hear the voice of the business partner. Tone, speed, the

height of a voice and others are important factors in the non verbal communica-

tion as described in 2.1.2.1 Communication on page 15. Thus telephone is an

often used medium in the daily business.

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The term virtual conferencing comprises telephone, web- and videoconferenc-

ing.

Whereas telephone and web conferencing systems have already established to

about 50%

in the industry, video conferencing systems are mainly used by

companies which are operating in a software or telecommunication sector like

German Telecom, Polycom or SAP.

The most stated reasons for not using video conferencing by the questioned

companies during a study of Easynet were that it just has not been considered

yet or that such solutions are too costly.

There still is a high potential for companies to save business travel cost by a)

thinking more about the possibility of videoconferencing and b) to recalculate

the savings of travel vs. videoconferencing systems where possible.

Videoconferences are mainly an alternative for internal visits and business part-

ners who have already meet in person

and rather will supplement personal

meetings, than replacing them.

Cf. VCD, p.26

EASYNET, p.37

Cf. REPPESGAARD

EASYNET, p.47

Cf. VCD p. 26 and EASYNET, p.20 and CONRADY, p. 194

Cf. BROMME, p 130

Details

Seiten
Erscheinungsform: Originalausgabe
Jahr: 2009
ISBN (eBook): 9783842842007
DOI: 10.3239/9783842842007
Dateigröße: 1.8 MB
Sprache: Englisch
Institution / Hochschule: Rheinische Fachhochschule Köln – Engineering
Erscheinungsdatum: 2012 (November)
Note: 2,5
Schlagworte: travel business category commodity einkauf reiseleistungen

Autor

Annette Rocholl (Autor:in)