Euro Biz Buyers Hold Out On Travel Automation

<B> Euro Biz Buyers Hold Out On Travel Automation</B>
<I>Sabre To Test Euro Tech Market</I>

By Amon Cohen

From nylons and rock'n'roll through Leonardo DiCaprio, Europeans have gratefully accepted most things American. But there is one thing they will not buy at the moment: travel technology.

In spite of the buzz they are causing stateside, the natives East of the Atlantic are revolting over the prospect of introducing booking, management information and expense accounting systems into their travel departments.

There are many reasons for the slow creep of technology--technical, historical, structural, economic, practical and philosophical. First up are two major impending events, which put travel well down the list of most corporations' IT priorities.

"There is a lot of pressure on companies because of introducing the Euro and ensuring Year 2000 compliance," said David Young, information technology director for Farnborough, U.K.-based Business Travel International.

U.S.-headquartered BTI Americas, of course, also has had to deal with Y2K, but travel technology managed to sneak onto the agenda a year or so before efforts started to stamp out the Millennium Bug in America. European companies also are expected to spend 1 to 3 percent of their turnover in the next year preparing for Economic and Monetary Union.

On top of the unpropitious timing is an even more fundamental difficulty--the lack of homogeneity in the European market. "The most important problem is the cultural differences between European countries," said Brian Ranch, managing director of Danish travel technology developer Business Travel Consult. "Even in Scandinavia, the countries are very different. Here in Denmark, our client Lego does everything itself in-house. But in Sweden they outsource as much as they can so that if you want to do something for a corporate, you have to go via their travel agent."

Not only are there cultural differences between each country but there also are practical considerations. Expense management systems in particular have to be redesigned almost totally for each national market because of huge differences in their fiscal regimes.

Even the nature of travel is more complicated. "The U.S. way of doing travel is not the same as the European way," Ranch said. "U.S. systems are for people doing the same journeys three times each week, where all you have to do is change the dates on the booking. There are more ways of traveling in Europe and many local products to add to the booking engine. The Swedish and Danish rail companies, for instance, have different systems from each other."

There also is greater cynicism about the value of adopting self-service technology instead of leaving the job to travel agents--unless, of course, you are Danish. Elaine White, Germany-based president of travel technology consultancy The Global Group, said: "Thanks to international organizations like the Association of Corporate Travel Executives and the International Business Travel Association, everyone in Europe knows what is going on in the United States-- but the cultural differences are great."

"Some corporations are being more progressive and testing booking systems while others are going through their travel agents. There is no one clear direction yet--but it is fair to say that there is a much more trusting relationship between travel agents and their clients in Europe. There are more outside relationships and partnering in Europe, leading to more structured business relationships," White said.

Ranch believes that Europeans are also more suspicious of technology per se. There are concerns that employees will spend too much time playing with their IT toys and that the returns to be gained will not justify the overall investment. "It takes a lot of time to manage systems," he said.

"Things are moving in the right direction, but not as fast as those who are hyping it claim," said BTI's Young, who predicts that self-service reservation systems will touch down in Europe at the end of this year. "In Europe, companies are not prepared to sit down to restructure and adopt a three-to-six month planning cycle."

The BTI technology chief has seen several projects become lost in clients' IT departments as they worry over security issues and distractions such as EMU and Y2K. Companies also are nervous about linking expense management systems into their accounting systems, which Young describes as the most difficult plug of all. For that reason, both he and White believe much is riding on the collaboration being cooked up between Amadeus and financial software giant SAP, which should start to provide some results later this year.

Young finds that the difficulties with SSRs extend beyond corporate IT departments. They also clash with European office culture. "In the U.S., companies have the ability to mandate employees not to use their travel agent," said Young. "These are the only companies that say they are successful with self-service reservations.

"In Europe, many big companies will not mandate policy because they do not want to be considered to be threatening their staff. As a result, we have been conducting client SSR trials with companies of between 30 and 1,000 travelers and the production of bookings through them has been relatively light."

So marked has been the reluctance of travelers that some BTI test clients now say they want to switch off the ability to book through their SSRs, leaving the systems as little more than glorified airline guides.

"They want a tool to look for live schedules, but the revenue we make from these systems is in transactions. So if they are not booking, we are going to charge them for looking," said Young.

Preparing to step into this minefield is Sabre, which commences beta-testing BTS with its first European client in the United Kingdom next month. Like many before it, Sabre is finding the United Kingdom has more in common with the United States than most European countries do, not least being the language. Even so, Sabre has had to make several small but important changes in the U.K. version of BTS, such as introducing a 24-hour clock and renaming coach class as economy.

Bob Teerink, Sabre managing director of marketing for Europe, the Middle East and Africa, said the company is customizing BTS for each individual market. "The modules we use in the U.S. are all pretty much alike, because we have just one currency and similar corporate travel profiles," said Teerink. "In Europe, we are looking for market-specific modules to complement BTS. Even travel planning can be different in each country." Sabre's third-party providers for the European marketplace were based on both sides of the Atlantic, he noted.

Teerink said Europeans are "definitely more cautious" about adopting travel technology and the key to winning them over has been to find a person within each client company to champion the cause.

Despite the differences, Teerink claims it will be in corporations' interests to adopt the same system in both the U.S. and Europe. "It gives you the benefit of standard practices because--with some modifications--the core functionality and the look and feel of it will be the same," he said. "Employees who use the system in the United States will be able to come over here and use it without any problems, and corporate trainers from the U.S. will also be able to instruct employees in Europe.