<B> Buyers Lift Online Bar</B>
<I>New Tech Implementations Have High Hopes Of Fast Penetration</I>
By Cheryl Rosen
At long last, leading-edge corporations appear to be raising the bar that defines a successful technology rollout to well over the 50 percent adoption mark.
Sabre BTS took the lead in this arena last month, announcing two customer implementations with aggressive rollout schedules. In the United States, AlliedSignal Inc., though not even in pilot yet, plans to move 15 percent of tickets from its 18,000 travelers online by the end of this year, and 70 percent by the end of next.
"Where two years ago we looked at travel systems for the cost savings they might deliver, now at the CEO level they are looking at them also as a demonstration of the way we should all be connecting to our customers and our suppliers," said AlliedSignal director of travel and site services Jim Lee. "We are all developing strategic plans for our own businesses in e-commerce, and top management is looking at travel as a perfect way to demonstrate the power of e-commerce. We have caught the attention of the leadership of our corporation, and their endorsement and support makes rapid deployment possible."
Even more aggressive than AlliedSignal's plan is that of Motorola Asia, which in about six months has achieved 90 percent usage on $4 million worth of predominantly international itineraries--the ones the industry has long considered the most difficult (see story).
At AlliedSignal, the technology initiative is the result of a partnership between shared services and corporate materials management, with "one person responsible for the internal delivery of the program and one for vendor relationships," said global travel procurement manager Tim Berndt. "Our whole thrust is to make the experience cost-effective and easy for the traveler. Clearly, technology is a key today--and will be increasingly a key in the future--in optimizing corporate travel programs. We tested almost a year to validate the readiness of our culture, and the feedback was very positive. We used a combination of a formal RFI, which we sent to ITN, AXI, BTS, and then a formal RFP to identify and convey our requirements and expectations."
AlliedSignal used the Six Sigma continuous improvement methodology and a decision matrix that weighted bidders on five criteria: product, account support, technology strength, cost and company profile, though "product was really our priority," said project leader Patrick O'Halleran, manager of travel reporting and communication for the Morristown, N.J.-based company.
AlliedSignal's aggressive rollout plan calls for a four- to six-week pilot with 250 travelers and a broader rollout on Sept. 13 to the New Jersey and Arizona facilities that house about 6,000 travelers, a third of the total. The Top 500 travelers, who take more than 30 trips a year, and travel arrangers, also will be included. "We'll look for the numbers to pick up by the fourth quarter," O'Halleran said.
That expectation is based on the support of senior management, a schedule of live and online training, and the current 90 percent usage of its automated expense reporting system, said travel services manager Sandra Barker.
Also important is the fact that "E-business is one of the big focuses at AlliedSignal, and our chairman is pushing it throughout the company," noted Berndt. "Our vision of five years from now is clearly a technology-driven process, end-to-end and global."
The key to successful implementation, he said, is benchmarking with other companies that have been through the process. "You can't go in there with a blank piece of paper. You need to understand the dynamics."
AlliedSignal is far from alone in pushing the envelope. Sabre BTS said 13 customers have moved more than 60 percent of their travel commerce online, and all vendors report at least a handful of corporate accounts achieving 90 percent usage, though none will share names.
"It's not a tools issue or a technology issue, but a change management issue," said Sabre's Pete Stevens. "Travel managers spend all this time looking at options and choosing a system, and then they throw it out there and say, 'Use it if you want it.' If you're going to do it, you have to support it."
AXI reports its highest usage is by one customer who has achieved 78 percent penetration, said Interactive Travel Group vice president Joe Monaghan, though he declined to name names, followed by Thomson Corp.
Thomson's Michael Cox also has seen a surprising leap in hotel compliance. Where only half of Thomson's hotel reservations used to be booked through the travel agency, 60 percent of online bookings include a hotel. And again, travelers are doing the right thing when allowed to freely choose. "In our top 50 cities, 72 percent of room nights booked online are in preferred hotels, versus 49 percent in the same cities booked over the phone," he said.
Sabre, too, is seeing improved hotel bookings though BTS. "Our customers report that reservations made online include a hotel reservation three times as often as those going through an agency," said BTS senior vice president and general manager Nancy Raynor.
On an Online Booking panel at NBTA, VeriFone travel manager Dorian Stoney said that 60 percent of all airline tickets, and half of all car reservations, now are coming through the online system. He also cited a number of unexpected benefits, including a 15 percent reduction in average ticket price in trips booked by travelers over those booked through the agency; a reduction in trip cancellations from 10 or 12 percent to just 7 percent; a 25 percent reduction in telephone calls to the agency during the traditional back-to-work rush on Monday morning.
To build usage, Stoney suggested, do not put restrictions on online systems that are not on live agents--for example, by mandating preferred hotels through one and not the other. Line up as much support and resources at the highest levels possible, and designate a champion. Keep it simple--"don't introduce a high school curriculum to a kindergarten-level traveler." And finally, just "take the leap," Stoney urged.
Indeed, it seems that the next few months will be a time of pushing usage more than innovation in online booking. Where past NBTA trade shows highlighted new products, new players and new end-to-end partnerships, this year's floor focused on upgrades aimed at making the traveler experience faster, easier and more enjoyable.
Sabre's new version is designed to be 50 percent faster and to provide full synchronization of traveler profiles with HR and agency databases. Speed is "still the number-one issue with customers," said Pete Stevens, "and we are redesigning the next version, expected out in 30 days or less, to make it even faster."
AXI, too, is focusing on speed. Its newest upgrade, version 4.0, "is a significant improvement in workflow and technology that is faster to load, faster between the screens and changes the process to get the traveler through it faster, with more information on each screen and therefore fewer screens to get through," said Monaghan. "It includes enhanced parameters so you can make more changes on any screen rather than going back.