Defining Corporate Contracting: Improved Prism System Promises To Advance Air Deals - Business Travel News

Share this page

Business Travel Supplier Directory

Text size: A A A

Defining Corporate Contracting: Improved Prism System Promises To Advance Air Deals

December 13, 2011 - 03:20 PM ET

By Jay Boehmer

Since its release in 2000, Prism Group's SalesServer has defined how airlines contract with corporations. After more than four years of development and a handful of airline implementations, Prism is billing its successor system as yet another "game changer," according to president Michael Whitesage.

The company's automated contract management system, through which corporate clients share agency booking data so airlines can assess discount programs and monitor account performance, initially raised data privacy concerns among some buyers. Even if those fears haven't completely faded, Prism during the past decade has led an evolution of airline contract management and helped standardize marketshare-based airline deal structures. Its client base has grown to include 25 of the 30 largest global airlines, among them American Airlines, Delta Air Lines, United Airlines and 10 airline alliances or joint ventures. The technology also is baked into Avion, Prism's 10-year-old global travel management system licensed by corporations.

Michael WhitesageThe company expects its newest contract management tool to streamline contracting, provide greater visibility into account spending and ultimately bring more airline sales under contract. It reflects a growing airline effort to craft global deals, allows carriers to more clearly define which sales personnel can access specific sets of data and provides a single repository for an airline's corporate and agency agreements.

More than a half-dozen carriers already deployed Prism's next-generation system. The remainder of the user base during the next 18 months will "chart their own course" in transitioning to the new system, Whitesage said.

Core functionality from Prism's initial SalesServer tool is used for the new Sales Information System, but the company shifted to a browser-based environment from a server-based operating system. Among other upgrades, the new system integrates with customer relationship management tools and other ad hoc systems on which airlines rely.

Facilitating global sales, Prism's new system can toggle between Chinese, English, French, German, Japanese, Portuguese, Russian and Spanish. The tool also can report data in local currencies and account for other regional preferences, kilometers or miles, for example. Prism identified Russia's Aeroflot and Japan Airlines as early adopters.

The transition to a browser-based system has made Prism "much faster and much easier for the end user," said Japan Airlines vice president of passenger sales for the Americas Steve Smith. "There are less technical issues." The additional language and currency capabilities for JAL's Japanese sales personnel are "huge," Smith added. "Those kind of things are going to help them get educated on the usage of the system."

A New Lifecycle  

To Whitesage, the old system was a bound volume of Encyclopedia Britannica, and the new one is Wikipedia. "SalesServer was state-of-the-art in 2000," he said. "Its functionality is still robust and it still does its job, but that product is nearing the end of its lifecycle. This is a new lifecycle. We believe this environment is going to give us 20 years."

"We looked at creating an automated, centralized system that can give secure access anytime, anywhere," said Prism director of airline consulting Tim Haskin. By taking Prism to the cloud, users can access account documents and information, including copies of contracts, contact information and other client details.

Because critical client information is readily available to authorized airline personnel, it does not have to be stored "on a local computer or in a box under somebody's bed in the home office," Haskin said. That already has sped the submission and approval process of contracts among the first users, officials said, in some cases from weeks to days.

Contracted corporate rates already comprise between 12 percent and 15 percent of the average airline's sales. We believe that that's only half of corporate business flying out there.

MICHAEL WHITESAGE, Prism Group president

Carriers can map access to the system based on sales force hierarchy, so "each individual seller has access to all the information they need for their accounts," Haskin said. "The team leader has access to any information his or her team is responsible for, and it rolls up accordingly. The airline determines what that hierarchy will look like and who gets to see what."

The new system could supplement or supplant various others used by airlines. "Many airlines have CRMs like, and what they're doing is bouncing around from system to system," said Prism vice president Les Baker. "One of the objectives of SIS is to integrate it under one roof."

The system links with automated calendar and email systems, spreadsheet applications and other tools commonly used by airline sales personnel, making data easier to import and export. Prism also offers its own CRM tool, which gained only selective usage by airlines in the server-based environment.

The company claimed the system provides unprecedented visibility into airline sales, often in real time. Airlines can schedule the production and distribution of recurring reports or generate them on demand in various formats, including graphical reports or spreadsheets. As in prior systems, Prism promises "secure display of other airline data to meet antitrust requirements."

"I only half-jokingly say to airlines, 'If the phone rings late on a Friday and it's your boss and she wants to know how many F-class tickets we sold on Tuesdays through American Express in the month of May in this market, eastbound, you can have that answer in about a minute,' " said Haskin. "I encourage airline staff getting used to the system to really think wacky: 'What's the wildest thing you wanted to know about what your customer is doing, what your portfolio is doing?' The answer is there because I have 100 percent of your ticketing. That's where it gets exciting, because there's nothing that can't be known."

More Airline Sales Under Contract 

The new Sales Information System will house an agency contract management tool Prism promised this summer. That tool relies on origin-and-destination data from ARC, a transaction processing and settlement firm, and allows airlines to manage agency agreements much like they manage corporate contracts.

By managing corporate and agency agreements side by side, Whitesage said carriers would uncover what he called "double incentives"—for example, a ticket that received both a travel agency override and a corporate discount.

How the airlines use that agency data is up to them. "The airline may choose to pay a double incentive, or it could choose to pay one incentive to a party that directed the sale," he said. "It will give them transparency at that level. It will enable them to manage agency and corporate contacts in one place, with a new level of transparency." While there are no immediate plans to integrate bank settlement plans like ARC from other countries, "it certainly begs for it," Whitesage added.

Prism also expects its new tools to help expand the number of markets in which corporations and airlines negotiate discounts. Many airlines and procurement professionals historically have focused deals on no more than an organization's top 200 city pairs, but "companies have a lot more markets than people think," said Baker. "A very, very large company will have 20,000 different markets, and you can't really manage that by a spreadsheet. Your top 200 might comprise 80 percent of your travel; it might comprise 20 percent of your travel. It depends on the mix."

Added Haskin: "Gateway to gateway, hub to hub: That's not where the big profits are occurring. It's in those markets from what I call 'nowhere to no place.' Elmira, N.Y. to Duluth, Minn., where a carrier is one of several that may have connecting service, and the value of those tickets tends to be much higher and less steeply contested in the marketplace. That's where shifting just a few tickets can bring significant value to the carrier and create new savings for the purchaser."

Japan Airlines' Smith similarly sees more contracting opportunities. He tells clients that "there is a great opportunity for us to look at all of your travel and capture city pairs that you're not even thinking about."

Considering Prism's new agency contract management tools and updated corporate contracting tool, Whitesage projected about half "of all sales" by airlines eventually could include some sort of incentive not reflected in the published rate.

"Contracted corporate rates already comprise between 12 and 15 percent of the average airline's sales," he noted. "We believe that that's only half of corporate business flying out there." For corporate travel buyers looking to level the playing field, he added that Prism "next year will be releasing SIS for corporations."

The report originally appeared in the November 2011 issue of Travel Procurement. 

This page is protected by Copyright laws. Do Not Copy. Purchase Reprint

Leave your comment:


blog comments powered by Disqus