Danny Hood
During a Sept. 23 interview at The Beat Livein Cleveland, BCD Travel president of the Americas Danny Hood took questions from the audience and The Beat's Jay Campbell. He addressed a variety of topics, some of which follow.
How do you drive productivity?
We're faced with that everyday. Somehow, in a year where most of our corporations are going backwards on transactions, we've had to keep up with our costs very closely. There are five big technology initiatives that are really driving productivity. When we look at telephony today, we can set up a virtual call center. I like this new term that I'm using of "homeshoring." Do we really have to offshore everything to save money on labor costs? We've got 1,000 of our 4,000 employees in the United States that report through me who now work at home. With telephony and about $2,000 or $3,000, I can set up that agent to be in rotary with a virtual call center. With skill-set routing, I know that agent is available, they have the right skill set--internationally trained or whatever--and really drive productivity because I'm not just talking about one call center or onsite anymore. We are using offshoring in mid- and back-office processes. Centralized ticketing is a good one where we're using Juarez, Mexico, for our largest accounts, saving 12.2 full-time equivalents at 28 cents a minute. We can do that in Bangalore, India, for 21 cents a minute--not touching the customer. The middleware, the quality control, file finishing--the Compleat and Correx products out there--are really doing a lot of the robotic work in today's Web services platform. You want to tightly integrate to that middleware. You're really seeing a lot of file finishing, auto-ticketing, offshore auto-ticketing, centralized ticketing and spending that time with agents--traditional or online--setting up those 24x7 e-fulfillment centers.
What can BCD Travel do to handle the airlines' ancillary fees?
Right now, it's so complex. We're looking to the global distribution systems for solutions, but there are no standards. We've got a real problem with these ancillary fees because they're showing up on credit cards as really miscellaneous fees: American Airlines, Omaha, Neb. You don't know what it was.
Tying in with the upcoming elections and discussions about public policy as it affects the travel business, to what extent are you attempting to support industry initiatives and influence in Washington?
BCD Travel has to be an advocate for our travelers these days and traveler rights. We have to be out there lobbying in many ways. The National Business Travel Association, the Association of Corporate Travel Executives ... and we funded a little of the American Society of Travel Agents' specific lobbying efforts this year. With the election, I think we're all ready for change.
Are there issues after the elections that you'll push in associations or groups you're supporting?
Fuel prices, crack spread--it has to get to be some kind of normal budgeting area. Capacity cuts, I think a lot of cities are going to end up without service. You really have to look at businesses and where they are located. For all of our corporations today, to be a strategic supplier they want you to be Tier 3 certified, ISO-certified as far as your data centers, to make sure data is protected. They want you to [support] corporate social responsibility and be green. Even if you're private, like we are, [you] do most of the audits that Sarbanes-Oxley requires--the SAS70 audits. To be a strategic supplier of a multinational, you have to do all these things. It costs about $4 per transaction to make sure you're doing all those correct things. It really is being a good citizen and making sure there is data privacy, making sure that we are doing carbon offsets as a company and that we're really a good citizen in this industry. I look for all of us to look much deeper into dollars and cents.
One of our more eye-popping headlines of late was the dispute between Carlson Wagonlit Travel and United Airlines. What was your experience talking with United?
Every time the airlines go through their huge losses, they certainly come negotiate, and both parties negotiate hard. You have to negotiate hard for your own bottom line and shareholders, as well as your customers. The airlines obviously are putting up red ink, so you're caught in between. United is a preferred airline of ours. I think both parties negotiated very hard. It's always hard when a distributor and supplier have an adverse relationship and are not preferred. American Express and Marriott hadn't had a good relationship for many years, and they mended their relationship, which is good. Whoever is the largest--Carlson and Amex both say they're the largest--you need one of the largest distributors if you're United. Lose-lose is what I think that deal is today, and I hope they can mend fences and work it out. [CWT last week issued a statement saying it had indeed come to a preferred supplier agreement with United.]