Top 10 list of what to do as you assess risk and secure your travel program
Mitigating Risk and Navigating Travel Marketplace Acquisitions; Top 10 list of what to do as you assess risk and secure your travel program.
By Wendy Prewitt, Areka North America, Client Engagements
When GBT announced their intent to acquire CWT, I immediately thought, “What would I do if I were a Global Travel Manager or Buyer using GBT or CWT and how would I mitigate my company’s risk?” With this in mind, our Areka Team prepared a blog checklist of things to do and what to think about amidst marketplace change and pending supplier acquisitions.
- Assess the Situation: Understand the implications of the acquisition on your Travel Program. Evaluate how it might affect your service, supply chain, pricing, quality, and contractual obligations. Stay the course in the short run. Meanwhile, learn as much as you can through the press, reach out to fellow buyers, discuss with consultants, and challenge your suppliers.
- Communication: Reach out to both the original supplier and the acquiring company (GBT and CWT) to build relationships. Engage at executive and operational levels. Seek insight on how the pending acquisition will impact your program, contracts, and any ongoing relationships. Maintain open communication with both the original supplier and the acquiring company before and throughout the transition process. Building positive relationships can help facilitate smoother transitions and potentially lead to favorable outcomes.
Review Contracts: Review your existing contract(s) with the original supplier to understand your rights and obligations in the event of a change in ownership. (This is also relevant if your supplier is the acquiring supplier as service and focus are at risk.) Consult your internal legal counsel to ensure you are protected and know your options and limitations. Be sure to understand clauses related to exit/termination, material change, liability, assignment, representations and warranties, indemnification, etc. and any business related service level agreements (SLAs) and guarantees.- Systems and Security: Understand any system and security related risk that may arise from data / technology 3rd party / systems integrated with or connected to the original supplier. Consider loss of confidentiality, data integrity, availability of information…for example reseller agreements, licenses, data location, security protocols, integrations into corporate systems (ISOS, etc.).
- Multi Sourcing: If your current travel program is supported with a dual agency or multi-agency framework, reach out to your non acquisition related incumbents to fully understand their global / local reach and capabilities. You likely have an agreement with them and could quickly pivot if needed.
- Evaluate Alternatives: Begin researching alternative suppliers in case the acquisition leads to unfavorable changes for your business. Evaluate their reliability, quality, pricing, and ability to meet your needs. Consider light discovery or even an RFI to other TMCs to understand capabilities and implementation ramp up.
- Monitor Performance: Closely monitor the performance and staff levels of your current supplier and acquiring supplier (if possible). During times of acquisition, service degradation and staff retention can be a significant risk….from agents to leadership. Raise this topic to your legal counsel for possible areas of protection. Build a feedback loop and service escalation plan.
- Plan for Transition: Be prepared. Understand the acquiring firm’s direction and integration plan; gain insight on their products / technology; will they merge platforms or require change (portals, tools, reporting, data management, etc.) Develop a transition plan to smoothly shift to a new supplier if necessary. For example, if you decide to migrate to the acquiring supplier, do you want to be the first customer in – or the last customer in. Strive to control the speed and path. If the acquisition alters the terms of your agreements or introduces uncertainty, consider renegotiating to ensure your needs are met and risks are minimized.
- Stay Flexible: Be prepared to adapt your strategies and plans as the situation evolves. Market conditions, supplier capabilities, and other factors may change over time, requiring you to adjust your approach accordingly.
- Seek Support: If you encounter challenges or uncertainties during the transition, seek support from industry associations, trade groups, or professional advisors who can offer guidance and assistance. Areka Consulting is available to assist with strategy development, service risk management, program audits, and redefine program direction. Areka is a global independent consulting firm with 40+ staff around the world.
AREKA is an independent firm providing customized, end-to-end business travel management services to organizations worldwide. Areka’s aim is to empower travel managers and buyers to reach higher performance targets across all areas of their travel program, including corporate travel, expense, and strategic meetings management.
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