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Internova CEO J.D. O'Hara talks:
The former Travel Leaders Group in the past month made several moves to reorganize its structure, including unveiling its new name, Internova. The travel agency group also merged its Travel Leaders Corporate and Altour agencies under the latter's name and said it would do likewise for Tzell and Protravel. CEO J.D. O'Hara late last month spoke with BTN's Chris Davis about what the new structure means for the corporate market. An edited transcript follows.
BTN: Why are you taking these steps now?
J.D. O'Hara: I view it as a reorganization, and I think a lot of people would ask what took so long. There's been some feedback that there's confusion in the marketplace in terms of Travel Leaders Group. At the time [of Travel Leaders' 2008 establishment], naming the parent company Travel Leaders Group to support the Travel Leaders Network, which wasn't a well-known brand, made sense. As we morphed into the business that we are today, it made sense to relook at things and lessen the confusion. Before you ask the question, this was not driven by the Covid-19 pandemic. Rather, these plans and discussion started earlier in the year and perhaps even late into last year. And I've kind of had in my mind that I'd like to head in this direction, but I think [Covid-19] gave us a little bit more of a push to execute on it.
What we'd like to do is make sure that we've got the best processes, tools and support for each of these business divisions. To pick an example, Altour and Travel Leaders Corporate came together, and Altour had many, many processes, tools, et cetera, that were superior to Travel Leaders Corporate and vice versa. And so we're putting the best of both worlds together.
BTN: What are the specifics in how that translates in technology, integration and policies?
O'Hara: I think it's early in the process to answer that, but I can tell you, for instance, they're both on two different telephone platforms. Putting them on one platform creates a tremendous amount of service increase to corporate clients. One of the providers that one of the businesses was on, the [service-level agreements] were not up to speed. I would suspect that the teams under [Altour CEO] Alexandre [Chemla] will come together and say, "Hey, for this process, what do you guys do? And let's have a discussion about what the best of both worlds is." I would suspect booking tools, mid-office, the gambit would be the answer, but it's too early to specifically say.
BTN: What are your operating assumptions now regarding how Covid-19 is going to play out in the industry? Is it the same as it was in March?
O'Hara: You hear different views, from things are going to be OK tomorrow, to the opposite of that. I have a view that we're clearly in tough times, and we'll recover from that. It's a function of when and how fast. We're seeing bits and pieces of positive momentum, and we'll take whatever it is. The volumes aren't there to get too excited about yet, but I'm certainly glad that we're trending in the right place.
BTN: Given Travel Leaders' history of acquisition, what's the effect of Covid-19 in terms of potential M&A?
O'Hara: As a policy, we don't comment on M&A. I think valuation's a struggle right now, not just for us, but for anybody. We're always looking at stuff, and for the right opportunities, we're always engaging. So that will certainly be a healthy part of our future, whether short-term or long-term.
BTN: Have you had to pull back internal investment that you were otherwise planning?
O'Hara: Like any other business, cash is what we're focused on, and liquidity. Every single initiative, from a technology or otherwise growth investment, has been looked at and either been temporarily put on hold or has continued, depending on what we feel the importance of it is. Certainly a lot of projects have been put on hold, and we're taking all the typical steps that pretty much every other company is from a cost-avoidance perspective that we can.
BTN: How is the Internova financial position going forward, especially in terms of liquidity?
O'Hara: I wouldn't comment in detail. We feel positive about how we're going to come out of this. And so, I would say, on a relative basis, we feel really good.
BTN: Coming out of this, do you anticipate sort of the role of the travel agency changing for corporate clients with regards to configuration, the services they'll look for, or payment structures?
O'Hara: I've seen a couple of different views on this, and I'm not sure. I would tell you at least I haven't been involved in any discussions where we're planning on changing any structures from a corporate [client perspective]. And I think that these things evolve over time, and we view our clients like our partners, so we'll take that feedback, if that starts coming around. But I think the value of the travel advisor is going to be more necessary and important than ever. Call me optimistic if you'd like, but while it's horribly painful in the short term, I think this is going to end up being great for our distribution channel from a corporate, leisure and otherwise perspective.
BTN: What about corporate client acquisition? Is that happening now?
O'Hara: Yes, believe it or not. We're busy, actually. We've brought on several clients and won new ones that will be implemented in the coming months. That element of the business is actually quite active. I would suspect that it's slowed, and the [requests for proposals] have slowed, but it's certainly active. One of the areas we did not slow on was sales and account management.
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