CASE STUDY
Turning a low‑compliance government hotel program into a high‑performing outsourced solution
Charged with totally overhauling a government hotel program, FCM Consulting harnessed its extensive capabilities to deliver an optimised hotel program designed to support over 1,100 locations.
Over the course of the project, the government hotel program's management saw significant improvements.
This page will walk you through:
- Challenges and objectives of the project.
- How FCM approached the issue.
- Results of the updated program.
- Measurable program impacts and statistics.
- Ongoing management support.
Challenges & Objectives
Low compliance & limited visibility
With just 35% compliance, the hotel program was suffering from low booking transparency, poor contract negotiating power, limited accountability and uncaptured data. This was also causing heavy leakage and limited visibility, due to the volume of uncaptured data and non-compliant bookings.
Vendor disengagement & inventory issues
With limited inventory quality control, unmotivated vendors and a lack of oversight, an immediate strategic hotel program overhaul was vital.
Low vendor response rates and dwindling hotel participation were driving out-of-policy bookings, as well as significant program leakage. As a result, the client was missing out on a number of volume-based discounts.
Internal resource constraints
With internal resources under pressure, the client was unable to efficiently solicit and contract the broad range of accommodations options required.
Because there were no protocols for handling non-GDS (Global Distribution Systems) hotels and alternate booking channels, data was not being captured. As a result, accurate reporting, booking efficiency, and accountability were severely compromised.
Limited transparency across the program was obscuring attempts to measure effectiveness. The inability to measure adherence to government ESG requirements was also a major cause for concern.
How FCM Consulting approached the program
Understanding the program scope
After a stringent RFP process, FCM Consulting started the real work. With decades of industry experience and expertise, nothing about the client’s existing hotel program was spared from scrutiny.
Taking a deep dive into the client’s objectives meant engaging with their Category Management Working Group to determine the diverse needs of their future program. To understand the status quo, FCM Consulting started by asking a lot of important questions and listening.
From conducting surveys to better understand traveller preferences to identifying program pain points, FCM Consulting listened and learned.
Inventory vetting & expansion
In an effort to recruit competitive hotel partners to the program, FCM Consulting created a compelling strategy. By clearly communicating the client’s objectives, they attracted engagement with new properties - and strengthened their existing vendor relationships. This effectively expanded coverage and the program’s reach by 20%.
FCM Consulting’s proactive hotel program management successfully integrated new, high-quality inventory to achieve much higher levels of coverage and channel management solutions.
Cost savings & compliance by design
To maximise the client’s budget, FCM Consulting drew on decades of experience. Room-night volumes discounts were negotiated, and corporate rates standardised. Across the program, FCM Consulting was able to achieve a $31 average paid rate improvement. The result was better budget predictability for the client, with fixed rates across multiple destinations.
FCM Consulting hotel specialists honed the negotiation and contracting process. Using their strengths in analysing booking patterns and volumes, they leveraged the client’s buying power. With a focus on mutual value delivery, FCM Consulting achieved consistency and quality control across the client’s extensive inventory.
Ensuring employee safety and comfort was also critical for success. So naturally, every contracted hotel was vetted in line with company standards.
Results of the outsourced hotel program solution
With just 35% compliance, the hotel program was suffering from low booking transparency, poor contract negotiating power, limited accountability and uncaptured data. With no inventory quality control, a lack of oversight and out-of-policy bookings, the client was missing out on volume-based discounts. Low vendor response rates and flagging hotel participation were driving out-of-policy bookings and significant program leakage.
Vendor engagement & traveller compliance
FCM Consulting’s strategic hotel program overhaul was a success, and in the end, program compliance was boosted by 29%.
This made an immediate difference in the amount of non-compliant bookings, while simultaneously improving vendor collaboration. In turn, it meant better solutions to choose from, and less out-of-channel headaches to deal with.
Program coverage reaches 93%
FCM Consulting’s proactive hotel program management strengthened reach and integrated booking systems supported program coverage to reach as high as 93%.
The process delivered hotel options across 10 contracted chains - each fit to meet the varying needs and budgets within the client’s organisation. All while ensuring travellers received a consistent accommodation experience across the program.
Booking efficiency & centralised visibility
Due to the size and complexity of the program, which features over 1,100 separate properties, the booking process had to be customised to allow access to platforms beyond the Global Distribution System (GDS).
With the help of the dedicated experts on our team, they were able to radically increase both their expense and analytical visibility, and the speed and efficiency of their booking process.
Technology & reporting foundation
By outsourcing their hotel program with FCM Consulting, it enabled the client to start using a completely customised technology and booking solution.
FCM Consulting gave them the benefit of dedicated support for ongoing optimisation and performance tracking, complete with an ESG dashboard that ensures transparent and measurable program performance.
Results & measurable impact
Program performance in numbers
Breaking down the program’s performance in numbers shows some substantial improvements:
- 1,100+ hotels accepted into the program - and growing.
- 93% program coverage.
- 22.3% program savings.
- 64% hotel program compliance (up from 35%).
- AU$31 average paid rate improvement - so far.
Business outcomes
The client’s strategic outsourced hotel program delivered tangible ROI gains through stronger vendor engagement, improved policy compliance, and better traveller experiences.
The program continues to offer clearer visibility of their spend and on their ESG performance across the client’s complex, multi-property portfolio.
Ongoing hotel program management
Continuous optimisation & sourcing
Through the implementation of a full-service, outsourced hotel program, the client was able to remove the burden of time-consuming management.
FCM Consulting’s specialists continue to take a strategic approach to sourcing and program participation, by rigorously vetting new participant requests to protect their program integrity and maintain their preferred property channels.
Relationship management & rate optimisation
FCM Consulting’s up-to-the-minute hotel sector knowledge allows our team to keep finding new optimisation opportunities, renegotiate rates when needed, and nurture strong partnerships with hotels.
Better relationships with hotels help drive higher levels of engagement, improved traveller benefits, and offer more avenues for sustainable savings.
Governance, ESG & traveller experience
In order to ensure the program continues to evolve in line with the client’s goals, FCM Consulting’s focus remains on a number of important elements, such as assessing partner ESG values, updating traveller preferences, and compliance reporting.
Frequent audits, as well as forecasting the client’s future travel behaviours, provide ongoing actionable insights that FCM Consulting can use to maximise both their program’s compliance and cost-efficiency.
Ready to transform your hotel program?
If you’re ready to elevate the efficiency of your travel program, connect with FCM Consulting and explore all the ways you can improve your compliance, coverage, and savings.
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About the author
Felicity Burke
Director of Consulting, APAC
Highly experienced in analysing business models, travel programs, and company cultures, Felicity is a forward-thinking and innovative consultant who knows how to drive results. She thrives on listening to challenges and questioning the status quo to deliver savings and business growth for clients. With 30 years of experience in business travel and consulting, Felicity is the mind behind FCM Consulting's Global Trends Report and other thought leadership.