<H1>Early Birds Get Tools</H1>By Cheryl Rosen<H3>Digital, Charles Schwab And Cisco Expand Automated Booking Use</H3>
This week at least three corporations are expanding their beta tests of automated systems as technology vendors are beginning to deliver on their promise of installing automated booking systems by the fourth quarter.
At Digital Equipment Corp., in Maynard, Mass., a group of 125 travelers and travel arrangers, who have been using Sabre's BTS for availability information only, will begin booking live. At Charles Schwab in San Francisco, an intranet-based system will roll out to 1,500 employees. And at Cisco Systems in Menlo Park, Calif., a test group of self-bookers will expand from 5 to 50.
For the travel managers who have brought the latest technology to their companies, being an early adopter is like registering for Travel Technology 101-a course they are simultaneously being asked to take and to teach. They are taking a professional risk, and making a "commitment of time, hardware, equipment and patience," as Digital's director of travel-related services Joyce Flinn put it. In return, they are helping to bring to market technology that incorporates the specific needs of their individual companies, focusing the corporate spotlight upon the travel office and saving their companies money by streamlining processes without yet having to pay for these systems.
The lesson plans they have developed individually are remarkably similar: Begin with market research into the needs of the company, its travelers and its travel arrangers. Choose a small, cross-functional group of users and grow gradually. And line up technical support early.
Digital's Flinn has taken two months to get to this point. With a $60 million air volume and a global T&E bill of $320 million, Flinn focused first on the behind-the-scenes work that will help make the program a success. Before going live, she concentrated on the links to her agency and her internal systems, allowing a small group of travelers to look but not book.
Digital started working with Sabre in June, and only now is letting travelers access real availability, Flinn said.
"We have been testing the agency connections, and the system's ability to bring up flights and corporate rates," she said. This week, she is adding the trip planning and travel arranger functions, as well as the individual traveler profiles.
When signing up as a beta test, Flinn said, "it's important to do the research, to take the time to understand what you are looking for and evaluate how closely your requirements map with whatever you are testing. Clearly lay out your requirements and business processes first, and then choose technology whose product maps with what you want to deliver. You have to understand the commitment in time, equipment and patience, and have a mechanism in place to capture the feedback, so that it can be used in a consultative way to facilitate the process."
Further along in the automation process is Charles Schwab, where travel manager Bob Grant is reporting 200 hits and 10 to 12 bookings a day on the Internet Travel Network site system he has loaded onto his company's intranet, the SchWeb. Grant, too, began with a small group of users and has been offering only airline reservations. The system now is rolling out to 1,500 employees, with plans calling for the addition of hotel and car bookings, and a gradual rollout to all 9,000 employees, by year-end.
Net Pricing
Grant estimates the intranet system will slash the cost of a complete booking-including air, car and hotel-to less than $10, far below the industry average of $26 to $36 that his research turned up.
"Schwab spends about $8 million on transient air and another $6 million on meetings," Grant said. "I'm not looking to reduce our headcount at the travel department, but to be able to handle more-to bring in meeting planning, to allow people to register for conferences and sign up for breakout sessions online-rather than outsourcing it."
Grant intends to reduce Schwab's unit costs through net pricing. "We have made significant promises to vendors-and we will deliver because the company will decide which airline people will fly and which hotel they will sleep in and which car they will drive," he said.
Grant is so intent on driving travelers to use the booking system that he has ordered his travel agency to stretch out the number of times agents allow the telephone to ring before answering it, he said. "If I drive the service levels down on the phone, travelers will go to the Internet rather than sitting on hold," he said.
At Cisco Systems, too, travel manager Vicki Smith has proceeded cautiously in rolling out a beta test of Sabre's intranet version of BTS, called Laredo. Smith started her research about eight months ago, at the behest of a new corporate controller who came from a Motorola division in Phoenix that had cut its internal costs by installing an automated T&E system.
Expanding The Test Group
Smith chose Sabre about four months ago, going live with only five users in mid-August. This week, the test group will grow to 50; when Smith is satisfied that everything is working smoothly, she will add 90 more users. A companywide domestic rollout is planned in December, and Smith hopes to globalize the program within a year.
Her first step was a needs assessment, "to determine what exactly we wanted the system to do; then we worked with our MIS people to make sure everything was secure," she said. "We had weekly meetings with the five people on the system, and kept going back to Sabre with their feedback."
Concurrent with the Laredo launch, Cisco is building an automated expense reporting system that will link to the booking system and pay travelers directly through electronic funds transfer. The T&E system will follow a similar rollout pattern to the booking engine-starting with five users, then 50, then 140, then the whole company.
As it merges the booking and expense reporting systems, Cisco, like Schwab, plans to take a harder line on forcing compliance, Smith said. The booking system will bring up preferred suppliers first, and will allow travelers to book other suppliers only after explaining why they require such a policy exception. The T&E system will automatically kick out expense reports if travelers do not use a preferred supplier or enter a valid exception code.
Smith already has begun negotiating the supplier discounts that will guarantee a return on the technology. Moving all of Cisco's bookings to the Sabre CRS has necessitated a technology change at its agency, Apex Travel. In return for using Sabre as its booking system and its CRS, Smith has negotiated a "good deal" with American Airlines.
In addition, Smith has mailed out a new hotel RFP, underlining her commitment-and the system's ability-to truly move share to a limited number of suppliers. And because the automated T&E system will pay American Express weekly rather than monthly, she is negotiating for "some added value in return-perhaps a rebate or upgraded cards, that kind of thing," she said.
Smith also intends to renegotiate her travel agency management fee "after the dust settles, when we see how it all works out."
As a beta site, Cisco will not begin paying for the BTS system until everything works to Smith's satisfaction, and then will pay a discounted rate for 1997. "We did a full cost analysis, and the complete system will be cost justified in two years, including the cost of building the T&E system," she noted.
Schwab also is looking at expense reporting systems-notably those from Portable Software and Diners Club-and Digital Equipment is rolling out an internally built T&E system, dubbed Travel Management System or TMS, simultaneously with its booking system. Developed in France and already functional in Europe, TMS allows employees to complete expense reports online, generates management reports and reimburses travelers by electronic funds transfer.
Digital's Flinn noted that the time commitment of early-adopter travel managers does not end with the beta test-and that, in fact, prudence dictates keeping an open mind about competitive products before making a final decision on a global technology solution. Digital has not guaranteed that it will adopt BTS at the end of the test cycle, she said; senior management will have the final say in the choice of technology vendor.
Nonetheless, it appears that being a test site and co-developer surely must give a vendor the inside track.
Flinn noted her firm's long relationship with Sabre as Digital's global GDS. "The CRSs have been at the forefront of bringing full systems to the release stage," Flinn said. "We have a partnership under which we have shared our mutual vision, and we will continue to work with Sabre until the end of the early adopter stage, and be in the forefront for all of the cycles of BTS' Trip Planner module. Then we will evaluate the results, look at the competitive marketplace and do the market research to bring to the company the global solution we would like to implement."
Many of Flinn's concerns, including the pricing structure, still are being worked out, she said. Within the next six to 12 months, Digital's team of experts from travel accounting, IS and technology management will draw up plans, review functionality requirements and make the cost-benefit analysis that will lead to a recommendation to senior management.
Even before this test is over, Flinn is interested in looking at the newer technology of intranet-based systems that has quickly been gaining in popularity. "Our requirements are for a system that is modular, from a vendor that offers full service and support, offering local and remote access on a global basis," she said. "As new Internet solutions and different ways of doing business become predominant, we are anxious to look at BTS' intranet application."
Meanwhile, the three travel managers agree on a number of things. All reported overwhelmingly positive feedback from their test groups so far. "Everyone we talk to wants to be part of this," Smith said. And all said they were glad to have been part of the development cycle and considered it an enhancement to their careers.
"Some travel managers' first reaction to technology is fear, and they ask if I'm not putting myself out of a job here," Smith said. "But I think that while we may downsize a few agents, this is something that is going to enhance my position. The system will help me negotiate, cut costs and guide employees in making the right decisions. We will always need a travel manager to manage contracts, and I envision our agency doing complicated multi-leg trips and providing more in the way of customer service. I think it's important to be seen as a visionary within your company. I can't see a downside to this at all.