Question Time RIGHT? IS THE PRICE
In this regular feature, an industry expert answers your business travel issues or concerns. This time round, Chris Reynolds of 3Sixty Global answers three queries from Keith Mullineux from GE
Q.
Chris Reynolds SENIOR PARTNER, 3SIXTY GLOBAL Chris, senior partner and co-owner of the specialist consultancy company 3SIXTY Global, offers extensive experience in travel programme optimisation, TMC performance, tender, selection and imple- mentation, and travel procurement strategy and negotiation. He has over 20 years' industry experience, including five successful years as travel manager for Siemens. Chris is a member of the Chartered Institute of Purchase & Supply and former board director of the Institute of Travel & Meetings.
A.
EIGHTY per cent of our trips are booked using a self-booking tool
which does a great job in identifying the lowest fare available. However, carriers are busy unbundling which prevents apples-with-apples price comparisons and fragments the booking processes. How should we try to accommodate these developments?
THIS is an area of major dissatisfaction for most corporates
for both online and offline bookings as there is currently no satisfactory answer. The commercial decision taken by
some of our preferred suppliers to unbundle the services has been taken with little regard for the needs of their customers. Had our suppliers taken the time to consult with their customers and the technology providers this lack of transparency and incomplete MI could easily have been avoided. We are now in a position that we have
" We have to wait for our technology providers and TMCs to catch up before we can get back to the same place we were prior to the unbundling"
to wait for our technology providers and TMCs to catch up before we can get back to the same place we were prior to the unbundling. This will also impact the future search requirements as in order to obtain a like-for-like comparison the new search criteria will need to include the minimum requirements for taking an air trip – the flight, one bag, check-in and advanced seating, for example. The trend is also a threat to SBT providers as it is their technology that is unable to react to changing market conditions. I would recommend continuing to lobby these providers to bring to market a solution as soon as
possible, and speak to your TMC to ensure that they will be able to mirror the new search criteria offline and be able to report against these new categories.
Q. A.
OUR shareholders want to see costs reduced, while our travellers
expect to arrive at their destination in good shape. A seat in business class is typically three times that of one in economy, so how can we balance these competing pressures?
THIS has to be achieved through a clearly communicated, fairly
balanced travel policy that reduces unnecessary travel, covers alternatives to travel and pushes travel avoidance initiatives, internal meetings and the like. The first consideration should be the comfort and safety of employees; second, ensuring that travellers arrive at their destination in a condition to be able to perform their duties; third, control costs. Sharing these considerations with the shareholders along with the stated goals of the travel policy to reduce unnecessary travel will demonstrate a sound business approach. Annually, you should deliver a set of metrics to include number of trips, compliance, average cost of trip year on year, savings achieved and benchmarked costs compared to those of your rivals. This shows that the travel programme is well managed and necessary to meet the demands of the business.
Q. A.
SOME carriers avoid GDS fees by selling direct from their website.
Since corporates generally make their buying decisions from inventory displayed on the GDS, both carriers and corporates must be missing out. How might this particular circle be squared?
DIRECT sell is a natural step to take. It is proven in the leisure
market but is more difficult to achieve in the corporate arena. Moreover, the growth of alliances also strengthen the airlines' argument that they don’t need the GDS. Many believe that the solution lies with TMCs. Some are already building their own platforms that connect directly with multiple suppliers, while others will use third party aggregators. The end result would be that the TMC effectively takes on the role of the GDS. This is a possible solution in a 'managed' corporate environment but it will come at a price, which, in the short term is likely to be passed on to the corporate. Of course, the other solution would be for the GDS to reduce their fees...
IF YOU have a business travel issue you would like advice on from an expert, email us at:
help@thebusinesstravelmag.com
14 I THE BUSINESS TRAVEL MAGAZINE
BIGSTOCKPHOTO.COM
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