After putting up $116.6 million in travel sales in 2019, Executive Travel from Lincoln, Neb., finds itself on the Power List for the first time. What does it get as a reward? A global pandemic and a struggle for its very existence.
Steve Glenn, chairman of Executive Travel, hosted a conference call in April to alert investors and the media that the travel management company was on stable footing. When Glenn learned that the Small Business Administration was planning the first round of its Paycheck Protection Program loans, his team started working on their application 10 days before Congress approved that funding.
Working with local bankers, Glenn and his staff provided six years' worth of documentation, tax statements, profit-and-loss statements and Glenn's own financial information. After conference calls with bankers every two days, Executive Travel had its proposal in by April 1, had it processed by April 3 and received funding on April 10.
However, by that time, Executive Travel had furloughed 15 of its 54 full-time workers and put the rest on a three-day work week. Management went to a 20% to 30% pay cut as the company cut total expenses by almost 50%. However, 75% of the company's loan had to cover personnel costs for it to convert to a grant. Executive Travel brought all of its employees back.
Executive understood that there wouldn't be much business for staff to come back to, so it decided to use the time to "train the heck out of them," Glenn said. "We just made the conscious decision that we're going to invest in people and spend hundreds of thousands of dollars doing training, upwards of $500,000 to $1 million in training. For a small company, that's a lot of money," he added.
It turned out Executive Travel would need the help. After bringing in a Fortune 50 client in 2019, the company brought another large client on board in May. As Glenn has witnessed on several occasions in recent years, there is often opportunity amid large-scale uncertainty.
Glenn noted that when the Great Recession hit in 2008, Executive Travel still managed to turn a profit. Glenn discovered that while retail travelers pulled back on spending, so did companies. Businesses considered proposals from Executive Travel that they hadn't before the downturn. As a result, the company's business doubled in the two years after 2008, again in 2012 and again 18 months later.
"When companies are making a lot of good money, they don't want to change much. Guess what's going to happen in the next 12 months here?" Glenn said. "A lot of companies who we heretofore couldn't get in the door are going to come in here, and we're going to say 'Look around: Who's the only TMC who's fully staffed? Who's the only TMC supporting their staff and training their staff for the next level of the world?'"
And what can Executive Travel offer them after all of this? According to Glenn, the simple answer is service. He notes that technology can perform 90% of the travel industry's tasks well and Executive Travel is 90% online but that travel remains highly personal.
"A piece of technology or a widget doesn't care about them," Glenn said. "When I'm stuck in an airport in Toledo, I want someone to care about me."
Armed with that knowledge, Executive Travel set to work a few years ago on its Net Promoter Score, a management tool used to gauge the loyalty of a firm's customer relationships. It reengineered its phone system so a real person could pick up on the first ring. It committed to hotel rate negotiations and began generating more revenue from hotel commissions than it does from service fees. It does not charge clients transaction fees thanks to what it makes off of hotel revenue. As a result, its Net Promoter Score is a 92 out of 100.
Meanwhile, Glenn and his company are considering ways to further monetize corporate travel. With companies looking for cuts amid a pandemic-fueled downturn, Glenn said it's more important than ever for corporate travel departments to show the revenue their travel creates.
"I've been home for 45 days without flying, and it's been delightful," Glenn said. "This is going to cause a productivity assessment around the world."
"How would you like to be a travel manager today where the CFO is sitting there saying 'Well, what are we going to get rid of?'"