Reporter's Notebook: ACTE Flags Registered Traveler Concerns

Addressing Association of Corporate Travel Executives concerns that red flags could be raised if employees are denied Registered Traveler status, Verified Identity Pass CEO Steven Brill last week during a keynote at the ACTE conference in Atlanta said his company would ensure corporate travel buyers and their companies would not be notified of rejected applications. ACTE officials said privacy concerns about Registered Traveler programs are increasingly on the radar of travel managers, yet president Greeley Koch said ACTE will strongly support a program if it delivers on its promise to speed travelers through airport security checkpoints.

"Even though it's a voluntary program, could it cause a company to look suspiciously on somebody if they elect not to register or are denied membership?" Koch said, outlining ACTE's primary concern. ACTE trumpeted those concerns in recent weeks at a U.S. Chamber of Commerce hearing and its conference.

To quell such uneasiness, Brill said Verified Identity Pass—the only company operating a Registered Traveler program—would not disclose to corporate contract holders which employees are members of the program, even if the company pays for those memberships. Brill also reached out to ACTE to help with a "dispute resolution program" should companies want verification that the number of memberships they pay for are in fact issued.

Following the conference, however, Koch said, "That's the first we'd heard of it." Although ACTE will explore the possibility, Koch said, "My first thoughts are you don't want to overcomplicate a very simple process." As such, ACTE said the issue largely is one between employers and employees and the association last week began reaching out to human resources departments to engage support.

Brill stressed factors other than an employee's background—such as the inability to produce a readable fingerprint—could be a barrier to the program's entry. ACTE also noted some travelers would not want to disclose the background and biometric information the program requires.

Noting that TSA always had intended the program to be voluntary for the American public, Brill said that facet of Registered Traveler should be preserved in Corporate America. "We will not sign corporate contracts that require employees to be part of this program," Brill said.

However, the keynote left many ACTE attendees apprehensive. Using handheld instant polling devices following Brill's presentation, 53 percent of 106 respondents said they were concerned that employers would become suspicious should their application be rejected.

As TSA still is in the midst of its rulemaking for Registered Traveler, ACTE said it is encouraging the agency to implement an "expeditious" redress process to handle denied applications. TSA has noted that it is planning to establish a redress process, but has yet to detail such a process.

Meanwhile, VIP during the conference announced it had finalized a deal with HRG to join its stable of travel management companies, including TQ3Navigant and Travel and Transport, that will offer clients tiered discounts for Verified Identity Pass biometric smart cards that facilitate the airport security process. American Express also is in the final stages of putting together agreements with VIP and other voluntary credential suppliers, verified Andrew McGraw, senior vice president and general manager of American Express Business Travel for North America.

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Speaking about the industry's preparedness for a possible avian flu pandemic, Koch said, "In some of the polling we had done, there was concern that people weren't ready with their plans. We need to step up and do more as far as alerting people that they need to have their plans in place, because we don't want to see disruption to the travel industry for potentially up to a year," he said, referring to remarks by Dr. Julie Gerberding, director of the Center for Disease Control and Prevention, that the likely reaction to a pandemic would be "social distancing," tantamount to a worldwide quarantine. Koch said Gerberding invited ACTE to join a task force to get the word out when such a disaster might strike.

ACTE also joined Marilyn Carlson Nelson, Carlson Cos. chairman and CEO, in the fight against the trafficking of women and children, by signing the "End Child Prostitution, Child Pornography and Trafficking of Children for Sexual Purposes" code of conduct. Prior to ACTE's involvement, Carlson Companies was the only U.S. signatory of the ECPAT code. "Through training, communications and public awareness," said Susan Gurley, ACTE's executive director, "the business travel industry can help eliminate these practices."

During her opening night speech, Carlson Nelson spoke about what she deemed one of the greatest challenges of globalization: the creation of a fluid but common culture, respectful of national and regional differences, yet faithful to global corporate values and standards. "The secret is to create a host culture within the corporation in which these concepts are self-perpetuating," she told attendees. "As business leaders, we must think of the world not as groups of faceless, nameless masses, but as groups of individuals with values, likes, dislikes, families and futures."

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Travel executives seeking vendors for a corporate card program are more interested in merchant acceptance, global capabilities and data quality than loyalty rewards, according to a white paper on corporate card requests for proposals unveiled at the conference. The paper, sponsored by ACTE and AirPlus International, was compiled from interviews with representatives from 13 companies, five corporate card organizations and 208 responses to an email survey distributed by ACTE. Of 179 respondents, 64 percent listed merchant acceptance as critical in their evaluation of a corporate card program, and slightly less than 50 percent listed global capabilities and technology as critical. Only 35 percent said the features and benefits of the card were critical, although 46 percent said they were very important.

David Hillman, principal of Consulting Strategies and author of the paper, said it also indicated that buyers are looking far beyond just price when choosing a corporate card vendor. There was a time when corporate cards were almost considered nothing more than a commodity, but Hillman said that has changed.

"That was very refreshing for me, and it also told me that people who are selecting cards are going through the robust RFP process and are paying attention to the important elements of that process," Hillman said. "It's obvious to me that the sophisticated buyer is really reviewing the elements of the card programs very seriously."

The paper also indicated the need for a stronger reference source for corporate card RFPs, AirPlus president and CEO Richard Crum said. Although about 70 percent of 210 respondents currently or recently evaluated their corporate card program, only a little more than half of respondents used a formal RFP in the process.

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Many attendees during a session on global distribution system content feared access to fares could come at a price to corporate users. Fifty-six percent of 66 respondents using instant polling devices during the session said suppliers, including airlines, will charge corporate clients for content access within the next year and a half.

"The last thing buyers want is a rebate going to the agency and a GDS fee on the ticket," said panel moderator John Caldwell, president of Caldwell Associates.

Delta and United—representing the airline perspective during the session—said they would not embrace opt-in, opt-out options that could pass costs to users. Delta vice president of sales and distribution Pam Elledge said the carrier would not be "nickel and diming" travel management companies and corporations with an opt-in, opt-out model.

While airlines prefer their own distribution channels—namely their own Web sites—from a cost standpoint, United managing director of worldwide sales strategy Scott Brandt said the carrier would differentiate their own channels over GDSs as it offers such benefits as online checkin through its own site, but "we're not going to require corporations to come to united.com."

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Marriott's Steve Richard, vice president of global sales, during a session charged that buyers were not taking the request for proposal and negotiation process as seriously as they should and that buyers needed to do their "homework" better and understand that negotiations were a full-year job, something he referred to as "flattening out the cycle." BCD Travel's Maria Chevalier, vice president of hotel relations at BCD's Travel Procurement Solutions division, disputed his suggestion and said that the job was like a see-saw, with each side sharing data together to strike a balance. Deloitte's Brian Nichols, hotel and ground transportation programs manager, called for buyers and sellers to also share data better, a process he coined "transparency and trust."

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David Radcliffe, CEO of HRG, in addressing a general session touched on an issue key to his own philosophy: low cost versus value-added services. "TMC services are still required," he said, "but the changing delivery profile is getting more complex: online or unmanaged, unbundled or dynamic packaging? Clients expect to buy individual components."

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Asia/Pacific over the next six years will account for 30 percent of a global company's travel spend, up from 18 percent today, Megan Stowe, global sourcing manager at Intel, said during a session. "Is Asia ready for that?" Stowe asked. "If not, we're going to have to hurry up." Bicky Carlra, senior vice president of Asia Pacific at BCD Travel said in the past 18 months, airlines in India have added 170 new flights a day, and 330 new airplanes are likely to be added over the next 15 years—260,000 additional seats a day. That is still not enough. "At the present pace of demand growth, India will need 570 airplanes worth $55 billion by 2023 to keep the balance of supply," he said. Tight supply can make it difficult to negotiate, Carlra said, but buyers can negotiate for waiver of cancellation fees and upgrades, and take advantage of international carrier corporate programs.