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About the Author
20 year veteran Sales and Consulting professional for organizations looking to optimize their Total Spend Management (TSM) and Human Capital Management(HCM) programs.

Doorknobs and Travel Management: The evolution of the world of bookings

pmcgarry
SAP Concur Employee
SAP Concur Employee
3 0 663

It is safe to say at some point today, you used a doorknob.  If you were able to travel back in time fifty years, you would find door knobs.  Go one hundred years back, door knobs.  To help you win trivia night, the first patent application for a doorknob was in the 1878.  Over the past 140 plus years, they have become globally ubiquitous.  There is not a generation alive today which does not expect them in our lives. 

 

So, what in the world does the basic operation of a door have to do with Travel and Expense management?  Well we can look at a bit of history: the first Global Distribution Systems (GDS) appeared immediately after World War II.  Much like there is not a generation alive that doesn’t operate a door’s latch by twisting a knob, there is no corporate travel manager who worked prior to the advent of the global distribution systems (GDS).  After 70 plus years, we are used to it.  We expect it.  It allows us to contain and control things.  But things have changed. 

 

For those who have a structured travel management program we have used the GDS on a daily basis.  For the travel manager, we can look back to it first being coined in the “internet revolution” of the late 90’s and now know it as the common refrain, “But I found it cheaper online”.  The traveler, trying, in what they believe is the best interest of the company, has scoured the interwebs to find the very best fare.  Working in the travel industry, I realize the benefit to my company of booking through managed channels.  Despite this, I had a rude awakening recently.  Making travel arrangements to get from Colorado to a city in Florida through our online booking tool, I found a fare on a non-preferred carrier was a mere $148 and met my arrival time needs.  Great, book it.  Immediately after my booking confirmation arrived, an additional email from the carrier was delivered informing me that I could prepay for my carry-on bag and seat assignment and save money.  As an added convenience, it took me directly to the carrier’s site to complete this transaction, no agency or third party needed.  All told, it was $166 in fees to get a seat and a carry-on bag—more than the original ticket was.  My total fare jumped to $314, more than the full fare carriers that include these in the base price. 

 

So no, I didn’t find it cheaper, even with our managed process.

 

Directly marketing to me resulted in doubling the carrier’s revenue.  Providers are not hiding this tactic either.  Giving an interview during an investor day, a CEO of a global provider told the interviewer they were going spend multiple Billions of dollars marketing directly to court direct booked business.  Shareholders would only ever allow that level spend if the company is able to return a profit, so this should speak volumes of the power behind it.  Providers are looking for new distribution channels (NDC) for not only add-on sales but core bookings—cutting out the GDS and third parties of the past century.  The centralized content and control that we have all come to know and expect in our daily lives as travel managers is changing. The New Distribution Channels are no longer coming but are here. 

 

How do we manage this change?  Do we fully embrace the change and allow for (gasp) Open Booking?  Do we pivot to more draconian measures, clamping down as much control on the process as we can?  What is the balance we need to strike to maintain visibility and control of our spend but not driving inefficient processes for our travelers?

 

As destinations once thought of as safe experience geopolitical unrest and threats, blind spots in the booking process create duty of care risks organizations can no longer ignore.  For many this has meant working with their Travel Management (TMC) partners.  For some however they have not yet begun working together with a TMC.  No matter where you are on the continum, you need to work with partners who are willing to acknowledge that bookings are not fully centralized and, in all likelihood, will continue to decentralize and will help you manage the entire booking ecosystem.  Further, find a TMC partner that supports technology solutions like online booking tools (OBT) that capture the traditional content model, i.e. the GDS, but also augment that with the content published in the NDC model.  Finally, we need to give serious consideration to the idea that providers will not make all of their content universally available any longer, locking out the managed travel program.  Your partners need to support the ability to capture the details of those bookings as close to the booking time as possible to ensure our compliance, both in terms of policy and for duty of care, is met.  Organizations need financial compliance and travelers need to be supported and kept safe.  This is no longer nice to have. 

 

This is a new door that we are going to need to open.  It is not a simple prescription which can be followed to the letter.  It is an evolving process as suppliers and content distributors continue to evolve.  You can turn the knob of that door and continue learn more about the managing an evolved travel process by visiting concur.com