A 360 View of Travel Data

Transcription

1 Published January 2009 A 360 View of Travel Data Comprehensive travel data available on demand: That s the goal for mature travel management programs. As new solutions help travel managers move closer to achieving this goal, progressive corporations are finding more ways to use this data to their advantage. A business travel white paper presented by C O N T E N T S O L U T I O N S

2 Executive Summary With travel and entertainment costs representing one of the largest areas of controllable corporate expenditure second to payroll scrutiny of travel management data has become business critical. The purpose of data analysis, of course, is to uncover prescriptive solutions that will reduce costs and maximize travel efficiencies. The more business intelligence an organization can glean from this data, the more effective travel management efforts can be. But it s not just the scrutiny of data that has become more important. In mining this information, corporations have found an urgent need to increase data accuracy and visibility into overall spend, travel patterns and traveler behaviors. The demand for customized reports has grown exponentially as businesses press to get the most value out of their travel spend. As a global economic crisis enters the picture in 2009, the pressure to maximize travel value promises to be even more intense. January 2009 Produced by C O N T E N T S O L U T I O N S Elizabeth West Director/Writer elizabeth@promedia.travel Amanda McDonough Designer Louis Magliaro EVP Sales & Mktg. louis@promedia.travel Tim Reid Pres. & CEO tim@promedia.travel Sponsored by The avenues to data accuracy and configurability, however, have been fraught with challenges. Travel managers, procurement executives and business leaders now realize that to attain a 360-degree view of travel activities, a corporation must aggregate several disparate data sources both internal and external to achieve true visibility and reap its benefits. To this end, companies have utilized travel management companies, internal data warehouses and/or third-party data consolidators to flesh out a better picture of their travel programs through data. Other organizations simply accept the fact that their data is not complete and rely on a primary source such as a TMC or credit card company to guide travel management decisions. A driving force behind this compromise is time. The task of integrating and reconciling all of this data can be an arduous process, delaying full visibility into travel activities until it is difficult to take meaningful action on derived intelligence. On the flip side, timeliness often requires companies to make decisions based on a fraction of their data. New travel management technologies have made progress toward breaking through this data-decision conundrum, but solutions require a commitment to improving processes, automation and compliance. This white paper will help travel managers, procurement executives and C-level leaders learn about the challenges to obtaining a 360-degree view of travel management data, current solutions available, and how they can take advantage of new opportunities that will increase their ability to make impactful decisions based on true business intelligence. 2 ProMedia.travel Content Solutions

3 What is Real-Time Data? In a recent survey released by Procurement.travel, data accuracy and timeliness were cited as the most challenging aspects of attaining a 360-degree view of travel program effectiveness (see fig. 1, this page). As corporate executives and travel managers push for more information on more demanding schedules, the idea of real-time data has become an enticing concept. But what is it? There are four aspects of data that are important to the concept of real-time: Frequency of data collection/updates Frequency of distribution On-demand access Instant integration Technology advances over the past several years have made it possible to collect and/or update a good portion of travel data on 24-hour cycles. This includes booking data from the TMC, credit card data and even expense data as it is filed. In tandem with credit card and expense data, supplier information may also be included in this group. This set incorporates the lion s share of travel information that most companies need to make smart travel management decisions (see Sources of Data, below). Figure 1. Data Integration Challenges Accuracy and timeliness of data remain top challenges to attaining a comprehensive view of travel programs. Mean* Accuracy of data 1.71 Getting data in a timely manner 1.86 Consolidating data from multiple countries 1.94 Consolidating data from multiple systems 1.96 Securing budget for data integration 2.16 Reconciling data 2.29 Distributing data internally 2.36 *Lower number = more importance Source: Procurement.travel, 2009 State of the Practice Report 3

4 Advanced data monitoring and distribution on a daily basis is vital for certain efforts. Traveler safety is one. But more important to most companies is the knowledge that the data feeding all of their reports whether monthly, daily or ad hoc is the most current data available. And because the travel environment is constantly changing, on-demand access to data and the ability to drill down to granular details at a moment s notice have become increasingly important to both travel managers and their superiors. Real-time data no matter how quickly it can be accessed can only be used if it supplies a 360-view of travel activities. This requires integration from multiple sources into a single data repository that companies can rely on for comprehensive on-demand information. Sources of Data Travel departments gather and examine data from several sources (see fig. 2, this page). Each has its strengths and weaknesses and can be relied upon for certain points of accuracy. Figure 2. Major Sources of Travel Data Gather Examine Travel management company/agency 66% 71% Corporate card 65% 69% Expense reporting system 58% 64% Online booking tool 56% 60% Supplier reporting 48% 56% Central bill/ghost/lodge card 48% 54% Procurement card 42% 48% GDS 30% 28% Meeting management technology 23% 25% Source: Procurement.travel, 2009 State of the Practice Report 4 ProMedia.travel Content Solutions

5 Pre-Trip Travel Data Sources Global Distribution System Travel Management Company Online Booking Tool Global distribution systems (GDSs) are the powerhouses behind most pre-trip travel data. The primary source of booked travel data is a corporation s travel management company, whether a traditional TMC or an online TMC. Vast amounts of data are gathered by TMCs from online and traditional booking tools that house detailed information on individual passengers, flights, hotels and often car rental and other ground transportation. TMCs generally offer a standard set of monthly reports to clients based on this information, and can also supply customized reports based on client needs. Pros and Cons: TMC data gives companies a good look into policy compliance at the time of the booking and helps control traveler booking behaviors in such areas as advanced purchase, class of service and choosing preferred suppliers. When grouped, TMC reports reveal a host of data, including supplier market share, highest volume city pairs, average ticket prices, most active travelers and more. According to a 2007 ACTE/AirPlus International research study, a majority of companies use TMC data as their primary source of travel intelligence. Recently released data from Procurement.travel, indicates this is still the case. More important to most companies is the knowledge that the data feeding all of their reports is the most current data available. While TMC data is critical, most industry analysts agree that it represents the least complete source of travel information because it lacks visibility into whether the itinerary was executed. If travelers do not ultimately execute the trip or if they make changes en route this information is often not captured by the TMC. Reliance on GDSs presents another set of challenges, as certain suppliers are not well represented in these systems. Especially for travel in emerging destinations, it can be difficult for companies to obtain information quickly or ever. Local or regional TMCs may hold the answers to these challenges, and the ability of larger TMCs to partner with these local service providers and feed data to appropriate tools will be critical. Some TMCs now offer data consolidation services to their clients to offset some of these drawbacks (see Data Integration and Emerging Technologies, below). Billed Travel Data Sources Corporate Card Central Bill/Ghost/Lodging Card Procurement Card Corporate credit cards are often a corporation s best source of purchased travel information whether the company uses a ghost card, charge card or purchasing 5

6 card (or a combination). It is important to ensure Level 3 reporting from a corporate card provider. This allows companies to see specific details about many types of purchases: sales tax, freight, duty and line item details for every purchase (product/ service, quantity, item amount, etc.). Encourage corporate card adoption by integrating payment and expense into an automated tool. Not only does it drive compliance, it increases productivity and reduces processing costs. Pros and Cons: Corporate cards provide hard data on actual travel and entertainment spend, and they provide excellent data for point of sale and ticketing carriers. These reports function as a vital complement to TMC data, filling in information gaps created by changes in itineraries or bookings that are made outside of preferred TMC or online booking channels. They also capture expenditures not traditionally included in the TMC arena, such as meals, client entertainment, parking and other ancillary travel categories. Hotel and car rental charges continue to be a source of frustration for travel management, as traveler spend is often not broken out as room rate, food and beverage purchases and Internet fees (in the case of hotels) or rental rate, fuel charges and insurance (in the case of car rental). Some major hotel and car rental chains have partnered with credit card companies to submit electronic folios that supply this information, but there is no one standard and details vary from card-to-card and supplier to supplier. Another challenge is driving employee use of corporate cards. Cash expenditures are not reflected, nor are expenses charged to non-preferred cards. An excellent way to encourage corporate card adoption is to integrate payment and expense into an automated tool, which streamlines the expense reporting process for travelers. Not only is this viewed as a service by travelers, industry research shows increased productivity and dramatically reduced processing costs in companies that implement such tools. Post-Trip Travel Data Sources Expense Reports Supplier Data Because they contain the actual expenses being claimed by the employee, a company s expense reports are generally its primary source of post-trip information, but a travel management department may also ask its preferred suppliers for reports about consumed travel. Suppliers are also willing to provide e-receipts that feed directly into the expense report, providing detailed data for expenditures at a line-item level. Depending upon a corporation s tools, expense reports can be the most well-rounded repository of travel and entertainment spend information. 6 ProMedia.travel Content Solutions Pros and Cons: Expense report data houses information from many disparate sources, including corporate credit cards, non-preferred or personal cards, cash

7 expenditures and e-receipts provided directly from the supplier. A recent Aberdeen Group study found that on average 20 percent of travel and entertainment spend is out of policy. The expense reporting process is the most likely of any T&E mechanism to capture this spend. However, stand-alone expense reporting systems offer limited data on traveler behavior or their efforts to comparison shop for the best rates. The information that is collected is captured after-the-fact so that only remedial rather than preventative actions can be taken. That, in fact, is the challenge of all post-trip data: While it may provide the most detailed information on travel spend, it is not captured until after the money is gone and the trip has been completed. Several additional factors complicate expense report data, including errors introduced from manual data entry as well as outright fraud. Moreover, manual processes can delay the final reconciliation of expense reports for months, making it impossible for corporations to get a snapshot of how much money is being spent. As mentioned above, automated expense reporting can mitigate several of these challenges, yet it is clear that no single source of travel data provides the 360- degree view of travel spend that corporations need to manage their travel investments effectively. A comprehensive approach to travel management must include an effort to integrate data from multiple sources and data silos. Data Integration and Emerging Technologies Only a few years ago, data integration was a process that required weeks of consolidation and analysis to create the reports and recommendations that corporations require for best-in-class travel management. Advanced technologies have made it easier and faster to access data as it filters into diverse data collection systems throughout the travel process, i.e. from pre-trip booking data to post-trip expenses. Data consolidation companies and some TMCs that have partnered with data companies to provide these services to their clients are now able to aggregate vast quantities of information from multiple sources, normalize the data and return it to companies in various formats. Many TMCs and data providers supply a suite of standard reports on a monthly basis and can customize additional reports for individual clients based on need. Many corporations with mature travel programs, however, are looking for more immediate access to their data. They want access to tools that allow them to make travel management decisions based on immediate business intelligence and put them in a position to take advantage of rapidly changing travel market conditions. Emerging analytics technologies are answering these demands, and they are built upon a series That is the challenge of all post-trip data: While it may provide the most detailed information on travel spend, it is not captured until after the money is gone. 7

8 On-Demand Analytics Tools: What to Look For Leading-edge companies are optimizing travel program effectiveness through the use of advanced data monitoring and online data analysis solutions. The following are some of the key criteria to consider in your search for the right tool: Ease of Use. Powerful data engines make web-based data analytics possible, but end users should not have to know it. Look for intuitive user interfaces with drag-and-drop query categories. Extensive training initiatives should not be necessary. Role-Based Access. Look for tools that offer several levels of access to information and configure users accordingly. In addition, a data analysis tool should allow both public and private folders for every user. Distribution Capability. Travel managers have a continuous need to share reports in a timely fashion. Automated report generation and distribution is vital. Individual users may also have a need to share regular reports; see that file sharing capability is included for all users. Reports + Dashboards. Data reports and graphical dashboards should be available within minutes. Look for various file formatting options, such as Excel, PDF, and others that are common within your organization. Standard + Customized Reporting. Inquire about how many reports are standard with the technology, but be sure your company is not limited to these. Customized reports and robust configurability for ad hoc reports are key features for on-demand tools. Technology Management. Ensure that your IT department or other appropriate division has access to an interface that configures your tool. When policy changes are made or corporate hierarchies are modified, your company should be able to reconfigure the tool at will. of previous tech advances that many travel programs have already implemented: Driving travelers to online booking tools Demanding touchless TMC transactions for faster processing Using automated supplier data feeds to garner updated information Automating expense processes to improve data accuracy and turn-around times for reporting and payment Each of these technology developments has contributed independently to increasing data accuracy, analysis and access, but when data is stored in discreet silos it has much less impact than it could when integrated and analyzed in a single system. A recent move by technology providers and client corporations to link online booking tools to payment and expense has created end-to-end travel solutions that are able to provide this important point of difference. The result a single data repository that captures data from multiple sources virtually in real time also forms the backbone of the new breed of on-demand data analysis and reporting tools. Emerging analytics solutions leverage the data captured at each point in the process from procurement through reimbursement and utilize web-based technologies that allow authorized users to access T&E data anytime, anywhere. Within the technology, data silos are broken down and information is integrated automatically from booking tools, corporate cards, supplier data feeds, expense reports and even supplier negotiated rates from GDSs. With all these sources of data housed in one repository, users can compare this information in side-by-side reports or create graphical dashboards that drill down to actionable results. Powerful data engines receive information from most sources in 24-hour cycles and can be scheduled to generate daily, monthly or quarterly reports based on the most up-to-date data. Distribution to designated groups and/or individual recipients can also be automated within these systems, mitigating some of the internal challenges that travel managers say their companies face every day (see fig. 1, page 3). Best-in-class data analysis tools offer extensive configurability and on-demand capabilities for users of all levels and interests. For example, divisional managers may only need to access information on their top travelers by volume for a particular report or they may want to roll up all the hotel spend data from their division to look for local savings opportunities that will help them meet budget for their business unit. On the executive level, however, travel managers often need to package data from all divisions or from travelers across business units. Online data analysis tools should accommodate each level of inquiry and allow users not only to see overviews and 8 ProMedia.travel Content Solutions

9 trends, but also to drill down to granular specifics that can help drive both divisional and enterprise-wide travel management decisions. Taking Action, Driving Results The fundamental reason corporations invest their resources in data analytics and travel management technology is to drive savings throughout travel and expense, whether to reduce hard costs or indirect process costs. Especially now, as travel market conditions become increasingly volatile, agility in the travel management space has become more important than ever. According to Aberdeen Group, a typical organization spends in excess of $12 million annually in T&E. That average goes up to $22.9 million for large enterprises with revenues exceeding $1 billion. On-demand access to accurate, integrated data provides the visibility corporations need to realize dramatic bottom-line results, even with seemingly minor changes to travel management policies or preferred partner agreements. Supplier management For many companies the process of vendor negotiations provides the highest profile opportunity for savings (see fig. 3, this page). Accurate data must be presented to support any negotiations, and when it is integrated with supplier data, it can create a more compelling case. Seeing evidence of advanced data monitoring also encourages supplier confidence. Especially now, as travel market conditions become increasingly volatile, agility in the travel management space has become more important than ever. Figure 3. Most Important Uses for Travel Data According to the Procurement.travel 2009 State of the Practice Report, companies ranked accurate data as important or extremely important to the following travel management functions. Vendor negotiations 75% Travel program/policy compliance 74% Provide business units with timely spend 67% Traveler tracking/security 65% Internal department budgetary compliance 65% Auditing vendor compliance 61 % 61% Easing expense report prep for employees 60% Regulatory reasons/sox 48% Other 15% Source: Procurement.travel, 2009 State of the Practice Report 9

10 However, supplier management encompasses more than discounted rates. Managing market share throughout the course of the contract is vital. On-demand reporting now allows visibility into the use of a given supplier with the most up-to-date internal and supplier data, giving travel managers the best opportunity to shift share where needed. On the flip side, by instantly comparing billed data to negotiated rate data, corporations can immediately flag preferred partners who are not holding up their end of the bargain. Traveler behavior and compliance Organizations looking at advanced data capabilities often have addressed supplier management through previous control efforts. They are looking to data analytics to help them identify internal improvements that will affect bottom line results. Traveler behavior and policy compliance are critical to incremental savings for companies with mature T&E programs. Especially for large companies, but for mid-sized organizations as well, managing individual travelers from a corporate level can be a daunting enterprise. User-friendly analytics tools make it easier to push data to division and line managers, who can exert immediate influence over direct reports. Is Your Company Ready? On-demand access to accurate data is not an overnight achievement. Corporations must adopt fundamental best practices to realize benefits and may need strong mandates in the following areas: Using preferred booking channels Online booking adoption Corporate card program Timely filing of expense reports Automated T&E processes For example, a lost savings report that details airfares and hotel rates that exceed available rates at the time of booking can be distributed to managers on a monthly basis. This approach might alert a manager that she is either approving too many exceptions to policy or that particular travelers continuously book higher cost travel when acceptable alternatives are available. The manager could then choose to make an overall change to her management approach or, in the case of the latter, could alert individual travelers to the problem and make it known that their booking patterns are being observed. With on-demand reporting capabilities, the manager can keep track of rogue travelers on a more frequent basis to ensure they adhere to policy. The same approach applies to other common travel policy infractions, such as failure to book in advance, premium-class hotel usage and the purchase of first- or business-class airline tickets. The more frequently data can be assessed, the better equipped managers can be to prevent lost savings before trips take place. As data segmentation capabilities become more robust and easy to use, more companies are also implementing internal benchmarking strategies to create a healthy competition between managers and divisions in relation to travel cost control. Such initiatives also contribute to tighter monitoring at the line manager level. Traveler Safety & Security Traveler safety is a critical component of any managed travel effort both on a corporate responsibility level and to protect the company s continuity and finances in a crisis. On-demand access to accurate data provides essential information. 10 ProMedia.travel Content Solutions

11 Many corporations maintain policies about the maximum number of executives that can fly on the same plane. By running daily flight reports, it is easy for travel managers to monitor this situation and alert executives to the situation. Some companies also receive daily updates on volatile geographical regions and can use daily origin/ destination reports to alert employees who are scheduled to travel to those areas. If the situation is serious, the trip can be cancelled or postponed. If a crisis should occur, corporations need to know where their travelers are located, how to reach them and how to move them to a safe zone. Daily updates on traveler locale are vital in such situations and can protect the corporation s human and financial resources. Conclusion Although challenges remain, the opportunities surrounding real-time data and ondemand access continue to grow. Consolidating data for global programs, in particular, has proven difficult. As travel management technologies proliferate in developing regions and GDS participation grows, access to global data will become more of a reality. But even now, the advantages for organizations that utilize real-time data solutions are significant. As a faltering economy moves toward recovery in 2009, nimble travel management will be key to maximizing a corporation s bottom-line savings and encouraging topline growth. By increasing a corporation s agility in regard to travel data, new technologies make it possible for organizations to assess their strengths and weaknesses more definitively, apply strategic solutions to traveler behavior and supplier management challenges more quickly, and monitor progress along time frames tailored to their business needs. Companies that follow new developments and implement solutions along the way will be in the best position to capitalize on advances in data analysis as they happen. Such advantages do require commitment. Corporations must manage tight travel programs and produce reliable data upon which to build analysis. Without the adoption of automation best practices and internal efforts to streamline processes and compliance, companies will continue to gather data more slowly and perpetuate the risk of human error. Leading-edge companies are taking a close look at end-to-end travel solutions and how this approach can optimize their data, both in timeliness and in accuracy. Those companies that follow new developments and implement solutions along the way will be in the best position to capitalize on advances in data analysis as they happen, and achieve true business intelligence. 11

12 About Concur is the world s leading provider of on-demand Employee Spend Management services. Concur enables organizations to globally control costs by automating the processes they use to manage employee spending. Concur s end-to-end solutions seamlessly unite online travel booking with automated expense reporting, streamline meeting management and optimize the process of managing vendor invoices, employee check requests and direct reimbursements. Concur s suite of on-demand solutions streamline business processes, reduce operating costs, improve internal controls and provide enhanced visibility and actionable expense analysis. For more information, visit ProMedia.travel LLC is an integrated media company serving the information needs of the managed travel and meetings marketplace. ProMedia.travel publishes Procurement.travel, C O N T E N T S O L U T I O N S Management.travel, TheTransnational.travel and TheBeat.travel. The company s Content Solutions department effectively delivers sponsored content to targeted communities of travel professionals via e-newsletters, white papers, webinars, supplements and other vehicles. For more information, visit