Carlson Closing Down Onsites

<B>Carlson Closing Down Onsites</B>

By Sarah Welt

<I>Minneapolis</I> - By phasing out onsites in favor of moving the bulk of its clients to a network of five large call centers, Carlson Wagonlit Travel is creating purchasing consortia with its smaller accounts using data captured in those centers to negotiate better supplier agreements.

Carlson Wagonlit, with about 500 U.S. onsites, plans to reduce that number to less than 100 by year-end. By moving to call centers, clients can expect more attractive fee arrangements, said Ron Merriman, Carlson's executive vice president of North America sales and account management. "For the most part, size does matter," Merriman said. "We will not be offering one-person onsites for small clients."

One reason for the push to giant res centers is that Traveler Service System--Carlson's proprietary call center technology--now is coming to fruition. Beginning with its Mendota Heights, Minn., res center, Carlson will implement TSS in one call center per quarter for the next five quarters. "We have about $100 million in volume running on it today and we are bringing up $10 million more per week," Merriman said.

Those centers--located in Denver (which is the next location to receive TSS), Rolling Meadow, Ill., Bedford, Texas, and Manchester, Conn.--are expanding to handle between 250 and 400 agents. They also will be furnished with telecommunications tools so the centers can roll calls to each other prior to the introduction of TSS.

Merriman said TSS allows the agency to provide access to bookable content through both the telephone and the Internet, giving agents the ability to harness cyber fares and still capture data for employers to help in supplier negotiations. TSS is able to connect to clients' online booking systems, though Merriman said, "Our official position is we will support some, but not all." Additionally, TSS enables agents to book on any GDS through the use of a graphical user interface.

One tradeoff to clients giving up their beloved onsites is the ability to participate in purchasing consortia. With TSS, the company is combining small clients' volumes to form these consortia to get better leverage with vendors. "When you take four or five $1 million accounts and negotiate on their behalf, suppliers may be polite but they sure as heck are not going to give them any deals," Merriman said. "But if we take 500 or 600 of those accounts and get them where we get consistent quality through technology, we can go to the airlines and say, 'Look, here's what we can do for your market share if we can negotiate for our existing clients.' "

In addition, Merriman has found many large- market customers ready to jump on the bandwagon and move to res centers. "Even though we've started smaller clients on TSS (25 clients are up and running so far), we are now getting a lot more pressure from our big clients to get on it faster, because they see the value."

Meanwhile, Carlson has made headway with its plan to create 15 to 20 large call centers in Europe (<I>BTN</I>, Sept. 20, 1999). The company last December expanded its Heathrow BTC, moving it to a new location and increasing the number of consultants to 120. This month, it is moving to consolidate two or three more BTCs into the Heathrow center.

Richard Lovell, vice president of operations and EMEA regions, said Carlson is interested in setting up another large call center in the northern part of the United Kingdom, and by year-end plans to have 10 locations capable of handling more advanced technology in the major European business centers. The company by 2Q00 plans to enlarge existing centers in France, Germany and Italy.

Carlson last fall began a test in Copenhagen, networking three of its branch offices with one automated call distribution system. "We want to see whether those three operations can be operated as one with accompanying productivity benefits," Lovell said.