Case Study: Alternative TMC RFP for JTI when COVID hit
Alternative TMC RFP when COVID hit
A business globalising, and changing for the better. JTI (Japan Tobacco International) is in over 80 countries with a travel and expense budget of $160 million in 2019. Mike Potter, Travel Services Director and Nichola Rimmer, Global Category Manager Travel & Events both sit in the global indirect procurement function, supported by Jo Lloyd of travel consultancy Nina and Pinta.
JTI had what Mike called a “patchwork quilt network for travel agencies”; more than 16. To truly globalise with JTI, the travel programme needed to also go global and, therefore, fewer agencies. To drive standardisation, savings, compliance and a whole roster of efficiencies.
JTI was always due to go to RFP in 2020. An RFI had already been undertaken and the list had been whittled down to five bidders.
Virtually turned on its head
Then COVID hit. A travel ban at JTI came into effect. Within a week, it was decided the RFP process would turn virtual.
As Mike explains, “We thought it was the right thing to continue with the RFP. We could drive this change through a particularly unique time when people weren't travelling; it would be less of a risk through the pandemic.”
At the time, working virtually was new. It was 8th March 2020 when the process was meant to start; the World Health Organization declared COVID-19 as a pandemic three days later.
“Mike and Nichola were dealing with learning how to build relationships and run the RFP virtually,” says Jo. “One of the key ways was to try and get as much of that RFP process off paper as possible, and do a lot of workshops and engagements with the various TMCs all through the process. That way, Mike, Nichola and their teams could get a feel for what these agencies would be like to work with moving forward, when they could meet in person.”
An open book from the start
Breaking away from the usual process and sales pitches, the JTI team pushed the bidders to really think about how they might tackle unique challenges and pain points.
Jo explains, “To use an old procurement phrase, they opened the kimono. They showed the bidders where their pain points were, what their challenges were, what was difficult for them, what their vision was. So anybody that came into this process had all the facts.
“I think that was one of the key differentiators about this RFP, because by being that open and transparent, they were really embodying the spirit of partnership, which they were looking for in a TMC.”
A glocal culture fit
Global AND local. A big part of JTI’s business model and culture (and ours too).
As Nichola explains, “We were looking for a long-term partner, so cultural fit and the people aspect of this was really very important. We've got offices in many varied places around the world, with some long-standing legacy TMC relationships. We didn't want to fully emulate those because we were coming into a global programme with global governance, but we still wanted those local relationships.”
Cultural fit is key. Someone who understood JTI and its intricacies. It’s a company that's changing; we're moving to a better way of doing business. But we're not particularly moving fast and we're quite a conservative organisation because of what we do. We really wanted people to understand that, and that “local glocal” is a phrase that's used a lot internally.
- Mike Potter, Travel Services Director at JTI
Online booking. That was one of the top priorities at the start. JTI has a direct contract with Concur for travel and expense, used in 20 markets. The team wanted a partner that understood Concur and could further its deployment. But over time that priority pivoted to the overall tech stack that the bidding TMCs could offer – in FCM’s case this included the use of Concur Connector to allow expense and travel data to be compared side by side, and the real-time communication tool Shep.
Naturally safety became a focal point. But so did offline support; that person at the end of the phone to help.
“Suddenly what we needed switched. It wasn’t just an online booking tool; what we need is a person at the end of the phone. Someone who can help get travellers from A to B; get them there in the safest way and with the most amount of information that's physically possible. We needed the comfort that there was support if someone got to a hotel and it was closed, for example,” says Nichola.
Mike adds, “We wanted to ensure the people that have to travel in the future, and we're still defining this, will have the best support around them. Be that tools, technology and people. The whole thing changed significantly.”
Amid changing the RFP process, Mike and Nichola were also fighting internal fires. Mike admits JTI were initially looking at potentially three partners on a regional basis. When COVID hit he saw an opportunity to accelerate that consolidation and go for one global partner. “The concern at board level is that we will be driving change too quickly. That we were tearing up those old relationships that had been embedded for years and years,” says Mike.
Mike and Nichola’s tactic was to fully involve stakeholders and employees in the RFP process.
Once shortlisted to the final three, the team asked the TMCs to make a video introducing themselves to JTI’s employees. Those were not only shared with key stakeholders but on Workplace, where employees voted on which they liked the most.
Nichola comments, “A lot of people have no idea what a TMC is. They just knew that there was someone at the end of a phone if they were having a problem when they were travelling. There's an awful lot of change management to kind of let people know what TMC is and what they do beyond that. And with the idea of the global programme and taking away some of those legacy relationships, we wanted to try and simulate opening up that whole RFP process.”
The decision was ratified by the board and ultimately JTI’s CEO too. FCM was chosen in December 2020. But Nichola and Mike held off communicating their new partner until January 2021, when they had endorsement from JTI’s CEO Eddy Pirard. The support is invaluable. “The fact that we had that endorsement means that whenever we run into any internal problems, we can always root back to that. There was a lot of internal positioning with key stakeholders that paved the way for where we are today,” says Mike.