When tasked with sourcing a new supplier, procurement professionals can take one of three approaches; go through a formal selection process, research local suppliers online or get advice or a referral from a trusted business resource or colleague.
Or, they can go for secret approach number four…
Secret approach number four is a winning combination of using a methodical approach that’s guided by industry best practice, a healthy amount of internet research for context and the considered opinions and referrals of industry peers.
When it comes to procuring the services of a new travel management company (TMC) referrals from a trusted business resource or colleague are particularly important. Business travel can be a source of stress and confusion, as well as a black hole in terms of spend, time and productivity, and so hearing of other organisations’ lived experiences of using a particular TMC often resonates strongly.
But how can you use these referrals in a more practical way during the procurement process?
Here are four things that it’s worth taking into consideration when acting on referrals during the process of procuring a new travel supplier:
Can the referee vouch for the reliability of the prospective TMC? When it comes to travel management, you will need your TMC to feel as though they are an extension of your own team and are working with the same goals, priorities and deadlines in mind.
If other organisations find a prospective TMC to be hard to get hold of, unresponsive and slow to sort out issues then this is a huge red flag, as leaving business travellers high and dry is the exact opposite of what a TMC is meant to do.
It goes without saying that the quality of the service delivered by a TMC should be consistently high, but do they deliver a great service even when things aren’t going to plan?
Depending on your relationship with the referee, see if you can obtain any data relating to the TMC’s SLAs and ask the referee to provide context for these; how was the agreement with the TMC arranged? Did they provide satisfying reasons for instances in which they failed to meet their SLA?
3. Value for money
A more formal approach to procuring a new supplier will often include carrying out some sort of benchmarking task, but when it comes to travel management these exercises will not always provide the most accurate results.
Low service fees do not always provide the best value for money, just as high service fees are unfortunately not always indicative of a high level of service. If you really do need to carry out a price comparison exercise, then compare it with the information provided by your referral for more accuracy.
4. Clear communication
Although the advent of online booking technologies has swept through the travel management industry, and with good reason, there is still plenty of communication that needs to take place offline – how available is the prospective TMC when the referee needs to get in touch?
It’s also worth finding out how proactive the TMC in question is when it comes to contacting their clients themselves; do they keep clients up to date with industry changes? Or spot and comment on organisational travel trends? Or, is it the client who always has to get in touch?
Referrals are never given freely and are instead only offered up when the supplier in question has maintained a good relationship with the client whilst delivering an excellent service. Whilst ‘word of mouth’ might not satisfy the number bods, it’s certainly worth working referrals into your procurement process in order to find a TMC that’s the very best fit for your organisation.
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