Diners Club: The Key to Managing T&E Spend – Tom Edgerton

Travel and entertainment are two of the most controllable expenses for corporates, and key areas of scrutiny for finance directors. Diners Club executive vice-president Tom Edgerton tells Steve Dunkerley about the benefits of a single global corporate card programme.

Globalisation drives corporate travel. Executives cross borders to close deals and make site visits to their various global operations. Regardless of the reasons, finance directors and travel managers need to make sure that airfares, hire cars and hotel bills are kept in check and that the administrative burden associated with the expense cycle is minimised. For Diners Club EVP Tom Edgerton, the solution is a single global card programme that delivers value beyond being a convenient method of payment for business travellers.

Steve Dunkerley: Why should companies roll out a global corporate card programme in the current economic climate?

Tom Edgerton: In short, to strengthen vendor negotiations, improve travel policy compliance and reduce overall travel and entertainment spend, which is essential for companies coming out of the economic downturn. Through a single multinational agreement with Diners Club, the expenses for travellers are consolidated to provide information. Web-based reporting provides data that can be analysed by the employee, department, division and vendor, among other categories.

A managed programme with global pricing, administered at country level, provides consistent service around the world and the ability to respond to local situations that arise during the course of international business. Local Diners Club franchisees also provide local currency billing and reporting, multilingual customer service and regional infrastructure.

SD: How should a corporate go about implementing a global card programme and how quickly can it be up and running?

"A managed programme with global pricing provides consistent service around the world."

TE: We recommend a phased approach. Phase I includes the top spending countries, while phase II incorporates the rest. The first phase takes up to 90 days from the completion of the contracts to full implementation. Phase II takes up to 120 days.

Our multinational staffing structure is designed to maximise effective communications at country, regional and global level, while ensuring singular multinational accountability for the programme's implementation success. Through clearly defined requirements, goals and proven project management techniques, the Diners Club team will take full ownership and leadership to ensure a seamless implementation.

SD: Have you any recent examples of corporate cards successfully implemented by Diners Club?

TE: Many large corporations spend a significant portion of their budgets on accommodation each year. One customer of ours knew that there were opportunities to reduce accommodation costs by focusing more closely on hotel selection and spending. To gain more control over these expenditures, the company launched an initiative to structure and refine the hotel programme. The key to its success was negotiating fixed rates with preferred hotels. The company's travel agency provided some data, but not the highly credible data needed for effective negotiations with hotels. The travel manager quickly overcame this obstacle by using Diners Club's corporate account manager and Global Vision® reporting tool.

The data reported via Global Vision provided the company with charge transactions, which are credible from the hotel's perspective. Global Vision data is granular and can be sorted in numerous ways, such as by brand, hotel chain, geographical area and date ranges. Taking advantage of this capability, the travel manager and account manager created detailed reports that helped identify those markets and hotel properties where most of its accommodation dollars were spent.

Global Vision data also helped shape the guidelines for the hotel programme and reinforce employee compliance. The financial results were astounding. The negotiated rates are as much as 30% lower among preferred properties in the company's top 80 travel cities. Over four years, this has added up to more than $3m in savings.

Diners Club executive vice-president Tom Edgerton.