Global Manufacturer Unilever Saves €1 Million Annually with On-line Reservation Solution Powered by KDS

Objectives

In 2003 Unilever led an effort to automate its internal operations in order to further reduce travel spending and streamline the travel reservations process. When Unilever analysed its travel booking process it realised it was cumbersome and time-consuming, with an average of five steps per booking. The company wanted to change travel buying behaviour so it could improve efficiency and drive savings. A key component of its plan was the ability to centralise its reservations operations. Also looking to the added value of FACG/Business Travel Services; point-to-point travel can be booked easily by the travellers or travel arrangers.

The Rotterdam FACG/Business Travel Services unit decided to begin its cost reduction plan by implementing a self booking tool in the Netherlands. The primary objective was to introduce a method to aid employees’ travel planning, while bringing cost savings to the company by lowering the average ticket price and speeding the reservations process.

The Solution

Unilever’s FACG/Business Travel Services conducted a thorough analysis of available solutions on the market to identify the most adequate online travel management solution. KDS Corporate was selected as the best solution to meet Unilever’s highly demanding travel environment.

Unilever Netherlands wants its chosen tool to be compatible with the services of its travel management firm, Carlson Wagonlit Travel. One of the key requirements of the selected tool was the ability to create a specific travel policy for each company location. Moreover, the application had to provide advanced workflow abilities. It was also important for the self-booking tool to display price directly from the availability screen.

The core technology behind the KDS Solution provides:

• A global solution built for worldwide markets, supporting 11 languages and more than 170 currencies.
• Multiple travel information sources (GDS, a supplier site, web based information) properly configured for comprehensive travel management.
• Direct access to clients’ negotiated fares, hotel rates and airline schedules.
• A smart and powerful fare quote engine.

Implementation

The three-month pilot began in February 2003, at the company’s headquarters in Rotterdam with a group of 165 selected travellers. Negotiated air fares, hotels and profiles and travel policies were loaded into KDS Corporate Travel Manager.

Unilever FACG/Business Travel Services private-labelled the KDS self booking tool U-Travel, and created a logo and tagline for optimal project visibility. During the pre-pilot phase, “teasers” announcing the up-coming deployment of the self-booking tool were sent to travellers to create a sense of anticipation.

Training materials were then produced and Unilever trained U-Travel “Ambassadors” to coach others and actively promote the KDS self-booking tool.

“As with any major deployment, maintaining a sense of urgency was essential to encouraging travellers to book online” said Wolter van Houwelingen, Travel Manager for Unilever in the Netherlands. Consequently, his travel department (FACG/ Business Travel Services) frequently informed users of the roll-out success. This communication was done through regular e-mail announcements when milestones were reached. A U-Travel “message of the day” was also used to communicate directly to each traveller when they logged onto the system.

Unilever worked closely with its travel agency’s technology division, Carlson Wagonlit Travel’s Solutions Group, which conducted an intensive and highly successful communication and change management programme, combining KDS solution with CWT travel expertise. At the end of the pilot phase, adoption rates reached 83 per cent, far exceeding the company’s initial expectations.

In September 2003, Unilever deployed the KDS self booking tool in the Netherlands for more than 2,200 travellers. It is striking to notice that the minimum adoption rate reached 25 per cent with little or no training. Within five weeks of deployment, adoption rates skyrocketed to 70 per cent on all trips. Unilever attributes its success rate to a combination of KDS Corporate user-friendliness and one-to-one approach that included a large scale communication and training campaign.

Benefits

KDS Corporate enables CWT to provide Unilever with a less expensive travel arrangement option, as manual processes are significantly reduced. With U-Travel, Unilever has rapidly reached an optimum usage rate of around 75 per cent, resulting in substantial cost reductions. Unilever estimates it saves an average in the last 3 years of €1 million per year on travel costs as a direct result of using the KDS booking solution. In this figure a reduction of the average ticket price of 15% is included, despite of the introduction (and constantly increase) of fuel surcharges, security taxes and airport taxes.
Other cost reductions are simply the result of better enforcement of the company’s travel policy. The KDS application makes it easy for users to identify compliant and preferred suppliers, deals and travel classes. Moreover, a non-compliant booking must be justified before proceeding to the booking.

“In addition, we have realised savings because of the “visual guilt” factor,” said John Aussems, “which has proved that travellers are more likely to opt for a cheaper fare when it is presented on the screen in front of them”.

Unilever has a very generous travel policy which allows for business class travel on most routes. However, because the KDS Corporate displays a combination of fares, including web fares and those of low cost carriers, Unilever says it has seen a sharp rise in the number of employees opting for a cheaper, economy ticket and selecting different departure times that yield a lower fare. On the agency side, agents appreciate receiving complete booking with well-formatted PNR.

Other benefits include:

• Successful advanced online workflow
• Easy exploitation of the GDS profiles through KDS Corporate
• Rapid deployment resulting in optimal ROI

The KDS platform continues to best serve the needs of Unilever’s employees. As a result, the company is now in the process of rolling out the KDS solution to its UK employees and is examining how the tool can be implemented in other European countries (e.g. Unilever Germany implemented U –travel in January 2005). Johan van Haften, CWT Account Manager for Unilever the Netherlands: “Unilever is also collaborating with CWT and KDS to add a rail booking function in preparation for the high-speed rail services currently planned for the Netherlands”. In addition, CWT is working with KDS on behalf of Unilever to augment the KDS solution with a more robust traveller profile management system, which will utilize the information housed within CWT’s Portrait Programme.